the UK “dementia tax” and the welfare state

Since 1948 most health care has been provided in the UK free of charge; and most of the funds come from central government; and it is raised through national (social) insurance and taxation.

Since 1948 (at least) social care has been subject to charges, based on means testing.  Some users of services pay little or nothing.  Early on, few people availed themselves of social care.  Most men died shortly after retiring at 65.  Home helps were directed towards assisting mothers giving birth to children at home, as the fathers carried on working.  (There was no provision for paternity leave – and none for maternity leave either.)  By today, the situation has changed enormously.

Changes to the funding of social care have been considered by successive governments, but the matter has been placed, repeatedly in the “too difficult” tray.

The 2017 General Election campaign has reminded me that home and day care charges are based on income, but residential care charges are based upon assets and income.  (Assets include houses and flats.)  Any major change to this regime by an incoming Conservative government, as proposed – taking account of assets – has great implications for many people in England but also for other countries, notably Wales, as the block grant to Wales will be affected by any adjustment to funding in England.  In other words, if the Westminster government spends (through its reduced allocation to local authorities) LESS on social care, then budgets in Wales will be influenced.  (Remember the implications of student tuition fees, led by England.)

How should social care be paid for?

The possible sources are these, and they may act in combination:

  • People paying for themselves, in full or in part
  • Charges based on a means test related to income
  • Charges based on a means test related to assets (capital)
  • Public moneys raised through taxation (and, in the UK, national insurance).

I believe in principle that social care should be free at the point of delivery, and, like health care, it should be funded out of taxation.

A less idealistic approach has to consider a modified version of this.  From one end of the telescope, in a manner of speaking, a residual minimum of savings can be protected from charges.  This is where we are now.  From the other end of the telescope, a “cap” on cumulative payments by users of services can be imposed.  This has been considered but not implemented.

Private insurance against the costs of social care has not proved to be a realistic option, as the risks are hard to calculate.

I would like to suggest that, in the interim, social care for people over the age of 85 should be made free and exempt from means testing and charging.  (The threshold is arbitrary and can be changed.)  One reason is that advanced ageing results in an increasing incidence of frailty – multiple frailties, indeed.  Secondly, what social workers and local authority finance officers wish to chase frail elderly people for payment?

A note on people with impairments and disabilities, aged 0-85.  Many young and middle-aged people are rendered poor – with low incomes and diminished earning capacity – and therefore are ineligible for charges.  Who would charge children?

I would hope that a threshold around age 85 might encourage insurance companies to offer policies for coverage for any care needs that arise before the age limit – and might encourage people to investigate the option of insurance.

The time is overdue for change – and for fair policies for social care.