Social Care: The hike in National Insurance will harm the North and not fix the problem - Mark Casci

There is a reason why successive governments have bottled reform of Social Care.

It is the same reason governments worldwide balk at meaningful reform to welfare, particularly pensions; it is extremely difficult and will always come with heavy political costs that will almost inevitably spell oblivion at the ballot box.

Current Prime Minister Boris Johnson pledged on his first day in office that he would be the leader to halt this legacy of intransigence.

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More than two years into his time at Downing Street, Johnson finally made his move on this front.

Boris is pushing for a NI rise.

His Government intends to raise £5.3bn for social care by 2025, funded by an increase in National Insurance contributions.

The move has been derided as insufficient to meet the cost of fixing the problem.

But purely from an economic perspective, I see nothing but pain from this retrograde and unimaginative policy.

Business is already hurting badly from the pandemic, with most sectors predicting a lengthy period will likely have to elapse before getting back to January 2020 levels as they battle with a botched Brexit trade deal which has weakened UK plc as a major trading nation.

The social care crisis has been brewing for years.

In 2023, they are already bracing for a substantial rise in Corporation Tax. The rise in National Insurance will exacerbate this burden substantially.

At a time when the economy is carrying so many thousands of vacancies, a rise in NI will make it harder for firms to fill these roles.

And once again it is set to be our nation’s young people who pay the highest price, as they struggle to find jobs and face less take-home pay as a result.

Rather than stimulating the economy, this move will hamper it – just at the time when we need it to fire on all cylinders.

Prime Minister Boris Johnson during a visit to Westport Care Home in Stepney Green, east London, ahead of unveiling his long-awaited plan to fix the broken social care system.

This unenviable situation will hurt Yorkshire and the North of England the hardest.

Wages in the North, which were lower than the rest of England before the pandemic, fell further during the last 18 months, unlike other areas where they actually increased.

The unemployment rate in the North is 19 per cent higher than the rest of England.

And productivity levels in Yorkshire lie rooted in the relegation zone.

A further hammer blow to wealth creators, entrepreneurs and ordinary working people is the last thing the doctor ordered for the North.

And if the rumours of a looming betrayal over the HS2 link to Yorkshire prove correct, we can almost certainly kiss goodbye to the sterling work done in recent years to promote inward investment into the region.

And then there is the efficacy of the plan for actually fixing social care. Experts in this field have queued up to label it “too little, too late”.

The funding will not address the huge vacancy levels seen in the sector, nor allow for access to foreign labour so short-sightedly culled as a result of Brexit.

And, owing to a seemingly perpetually weak opposition, there is no sign from Labour as to what they would do differently.

When I interviewed the Prime Minister just weeks after he took office (an interview conducted inside Armley Prison in Leeds incidentally, but that’s a story for another day) I asked him how he was going to fix this.

What followed was some pre-rehearsed waffle about ensuring dignity for those late in life.

As the months ticked by I had hoped some grand plan of New Deal proportions was afoot to fix this.

Instead it’s another tax hike, that won’t raise the capital required and only fixes part of the problem. I see little to no dignity in this.

There is no painless way to fix this and it will be expensive.

But punishing those who create jobs, and those who have the least, does not bear the hallmarks of an innovative and progressive nation.

I know first hand from my own elderly relatives’ lived experience how unfit for purpose the current system is. It is heartbreaking how, as the lifespan of our citizens have increased, that care provision has not kept pace.

A salient reminder that being alive is not the same thing as living.