THE Tory manifesto was a turning point in the election campaign. To say the policy announcements on pensions and care were badly thought through would be an understatement. They don’t really seem to have been thought through at all.
The combination of means-testing winter fuel payments for pensioners, with the draconian social care changes, suddenly saw the Tories’ traditional support among older voters waver.
Mass means-testing of pensioners has already been discredited due to the disincentives it poses to private pension saving. To extend means-testing in this arbitrary manner, without consultation and without proper understanding of how the policy would impact on pensioners, was a mistake of monumental proportions. To combine the two looked like a punishment to families with loved ones who were ill, not just to older people.
This policy proposal is not only politically poisonous, because it hits the very people who are most likely to vote Tory – those who own their own home, or who have built up a nest-egg or some assets to pass on to their loved ones; it also would not solve the social care crisis anyway. All the political pain, for no policy gain.
To suggest that the cost of social care could be met by means-testing winter fuel payments is fantasy. And almost immediately, the Scottish Tories announced that all pensioners in Scotland would still get the money, so this was clearly not going to work.
Of course there were multiple issues that played a part in this debacle. Some were due to Labour’s promises of free tuition fees, school meals and higher minimum wages, but others were own goals such as fox hunting, grammar schools and ultra-hard Brexit. Such unforced errors played into the hands of the Opposition parties. But the real killer was social care.
The care crisis has been worsening for years and is in danger of bankrupting the NHS. The Tories are right to say this crisis must be addressed. Clearly, more funding is needed urgently, and the burden will fall on younger generations unless radical reforms are introduced.
Under the Tory manifesto, a millionaire with cancer could have all their care costs paid by the NHS and their house was safe. But an older person with dementia, and a home worth £250,000, would have to pay for all their care until most of their house value was gone.
There are so many reasons why the Tory manifesto care reforms were disastrous, not only because they were politically poisonous, but they would also actually make the care crisis worse. Here are some of the major flaws in the proposals.
They would actually worsen NHS bed-blocking. Effectively, older people who owned their own home would have to pay for leaving hospital. Current bed-blocking often happens when older people stay in hospital until homecare is arranged for them. But if they know the costs will come out of their house as soon as they leave hospital, they and their children will have an incentive to stay in hospital for longer where care is free.
The proposals didn’t give councils any extra funding to pay for care. The lack of social care funding, either at state or private sector level, is at the heart of this crisis. No money has been set aside by local authorities, or individual families, to cover elderly care costs. Councils will still need the funding to pay for elderly care and will not know when they will recoup the outlay from people’s homes. Repayment will depend on how long the person lives, and may also involve legal costs to enforce payment from an estate. This leaves current underfunding unaddressed and fails to help councils plan for long-term care.
Social care seems an obvious candidate for National Insurance which only covers what is classed as health care, but not social care needs. Surely, social care for elderly people would automatically have been included in Beveridge’s welfare state, had the reality of today’s elderly population been evident at the time.
A basic level of minimum care (like we have with a basic state pension or NHS) which people can then pay more to top up on their own, would be a fairer and more sustainable way forward.
The Tory manifesto proposals for social care would be a disaster and are never likely to be implemented. The Labour and Lib Dem manifestos talked of a National Care Service and increasing taxes. However, rather than using care as a political football, a national solution is needed. This could consider extra National Insurance payments, or a charge on all people’s estates, plus new savings incentives alongside pensions and ISAs, and integration of health and social care systems. The care crisis cannot be left any longer, the need for radical action is urgent and a combination of reforms is needed. The sooner politicians wake up to this and work together to find solutions, the better.
Ros Altmann is a Tory peer and former Pensions Minister.