The Queen’s Speech

Social care reform

My ministers will seek cross-party consensus on proposals for long term reform of social care. They will ensure that the social care system provides everyone with the dignity and security they deserve and that no one who needs care has to sell their home to pay for it.”[1]

 

There is already a duty to promote dignity and security (Care Act 2014 section 1); already a right not to have to sell your home in order to pay for care (ie a deferred payment – Care Act 2014 sections 34-36); and the last time a Government tried to seek a cross-party consensus on sensible proposals for reform (2010), they were torpedoed by the party of the current Government.[2]

 

Principle

Necessary social care support should be provided free at the point of need.  All the arguments for (and against) a free at the point of need NHS apply with equal force to social care.  ‘Free at the point of need’ social care was the reform recommended by the 1999 Royal Commission.[3] For a recent update on the feasibility of this approach – see the 2019 report of the Institute for Public Policy Research. [4]

 

Provision

The New Economics Foundation (NEF) has published an important paper entitled Ownership in Social Care.[5]  It highlights a key social care reform challenge – namely:

to move away from short-termist, cost-driven competitive tendering towards public-social partnerships between the state and diverse, decentralised providers with ownership structures that enable people to have a greater stake and control over the care that is provided.

The reforms of social care that took effect in 1993 may have been intended to privatise social care but at least they spoke of a ‘mixed economy’:[6] a mixture of public and private care provision.  In the succeeding years the ‘public’ element has dwindled to the point that (as the NEF report makes clear) social care services in England are almost entirely outsourced – very often to ‘chain companies with an ownership model that concentrates power among shareholders’.[7]

One hears so much about the innovation of private businesses – but in reality in this sector it has been the innovation of debt and tax leverage, offshoring and ‘sweating the labour’ – in terms of wage reductions, zero hours contracts and electronic monitoring.[8]  NEF characterises social care in much of England as ‘extractive’ – driving inequality through low-paid, insecure jobs, and putting downward pressure on the quality of care.   Low wages, poor terms and conditions result in high staff turnover which is almost three times higher for private providers than public ones.[9] One of the most often heard complaints by disabled people and their families about the quality of care concerns constant changes in the care assistants delivering the care.

NEF presents an alternative vision – ‘shifting to more co-operative models in which services are owned and run by employees and / or people receiving support and their families’ and where there is a ‘much more significant role for local authorities, as public bodies that are democratically accountable to their local communities’.  Social care funding should benefit the local economy: should support secure, decent, well-paid work with the profits remaining locally – supporting disabled people, the providers of care and in consequence the local economy itself.  The NEF report is important and deserves reading / adopting.[10]

 

Paying for it

The Labour Government’s 2010 proposals to raise extra social care funding via an increase in inheritance tax represented (and continues to represent) a sensible way of finding additional funds needed to cover a long-term care settlement.  The funding required is relatively modest (an increase of less than 1 per cent of total government expenditure[11]) – and pales into the far distance the moment one hears mention of HS2.  It should also be remembered that 20 years ago Scotland embarked on a programme to make social care free at the point of need and this has proved to be a generally popular policy.  20 years ago a Royal Commission also came up with the same suggestion.[12]

Funding some of the additional costs through the medium of inheritance tax has the merit of pooling risk among those with significant estates and avoids the current system which Andrew Dilnot (who chaired one of the formal social care funding reviews – in 2011[13]) has condemned as ‘the most pernicious means-test in the whole of the British welfare state’.[14] Although there is much hype about inheritance tax being the UK’s most hated tax[15] one has to wonder if this has any basis (or any rational basis).  Taxing the dead seems to be a more attractive option than the alternatives and it is a tax that only kicks in for individual estates over £325,000 (and £650,000 for a married couple[16]) and even then the beneficiary retains 60% of the surplus.

And to close – a quiz question. 

“How many estates pay inheritance tax each year?” See footnote for the answer.[17]

 

For previous posting on social care reform see:

.
[1] Prime Minister’s Office The Queen’s Speech 2019 19 December 2019  p.37
[2] Nicholas Watt Spectre of ‘death tax’ haunts Andy Burnham’s care revolution Guardian 30 Mar 2010.
[3] The Royal Commission on Long Term Care With Respect to Old Age: Long Term Care Rights and Responsibilities [Chairman: Professor Sir Stewart Sutherland] Cm 4192-I  (The Stationery Office 1999)
[4] Harry Quilter-Pinner and Dean Hochlaf Social Care: Free at the Point of Need (Institute for Public Policy Research 2019) p.4 and only marginally more expensive (£2 billion in 2030) than the Conservative party’s 2017 election pledge of a cap and floor system.
[5] Daniel Button and Sarah Bedford Ownership in Social Care (New Economics Foundation 2020).
[6] Department of Health Caring for People: Community Care in the Next Decade and Beyond Cm 849 (Stationery Office 1989).
[7] See for example D Burns et al Where does the money go? Financialised chains and the crisis in residential care CRESC Public Interest Report March 2016.
[8] See for example UNISON Suffering along at home: A UNISON report on the lack of time in our homecare system (2017) and L.J.B. Hayes ‘Work-time Technology and Unpaid Labour in Paid Care Work: A Socio-legal Analysis of Employment Contracts and Electronic Monitoring’ (chapter 9) in Sian Beynon-Jones & Emily Grabham (eds) Law and Time (Routledge 2018) pp. 179-195.
[9] J Dromey and D Hochlaf Fair Care: A workforce strategy for social care (IPPR 2018).
[10] As does Reclaim Social Care Taking Private Social Care Provision Back into the Public Sector (2019).
[11] Harry Quilter-Pinner and Dean Hochlaf Social Care: Free at the Point of Need (Institute for Public Policy Research 2019) p.4. and only marginally more expensive (£2 billion in 2030) than the Conservative party’s 2017 election pledge of a cap and floor system. There would of course be substantial savings to the NHS budget – see ADASS Sort out social care, for all, once and for all (ADASS 2019) points out that investment in social care reduces pressures on the NHS due to the preventative nature of much of the work of care as well as benefiting the economy.
[12] The Royal Commission on Long Term Care With Respect to Old Age: Long Term Care Rights and Responsibilities [Chairman: Professor Sir Stewart Sutherland] Cm 4192-I  (The Stationery Office 1999)
[13] Commission on Funding of Care and Support Fairer Care Funding (2011).
[14] Amelia Hill Social care reviewer condemns UK system and calls for new tax Guardian 6th April 2017.
[15] See for example E Agyemang  Inheritance tax: what does the future hold? Financial Times July 11 2019.
[16] If the first person to die leaves their entire estate to their partner.
[17] Very few people are currently within the scope of Inheritance Tax, with fewer than 25,000 estates being liable each year. This is less than 5% of all deaths, even though ten times as many estates need to complete and submit forms (out of 590,000 deaths) – see Office of Tax Simplification Inheritance Tax Review –second report: Simplifying the design of Inheritance Tax July 2019 p.4.

.