21 November 2022

However social care is funded, Millennials and Zoomers lose out


Given the shamelessness with which the Government pandered to older voters in the Budget, the fact that Steve Barclay has delayed the introduction of the social care cap by two years is telling.

Campaign groups are concerned that it may now never come into effect, and are surely wise to be so. Given that successive governments have already pared important parts of the state to the bone to service existing entitlements, ministers would surely be mad to bring yet another bottomless money pit onto the books.

Working-age voters can be forgiven for having little sympathy for Boomers, in defence of whose interests the entire economy is essentially rigged, having to fork out to care for their own ageing parents or seeing their inheritances eaten away by social care costs.

But it may only be a temporary respite; when that electorally dominant generation get a bit older and find themselves facing the prospect of having to sell their own homes to fund their care costs, the electoral pressure to have the state – that is, working people – pick up the tab will be very great indeed. That the UK simply cannot afford to do it is no guarantee it won’t be attempted. 

In some ways, it’s a lose-lose situation for Millenials and Zoomers regardless. If we do end up moving social care onto the NHS model (which we ought to be moving away from anyway), that will only realistically be attempted through even more extortionate taxes. (There is an alternative where it’s funded by the proceeds of a thriving economy underpinned by planning reform and other major initiatives, but we don’t live in that timeline.)

Yet if that doesn’t happen, the combination of rising life expectancy and spiralling costs means that many working-age voters would see their inheritances – the one theoretical payoff for them of the current system, and in many cases perhaps their whole hope of buying a home of their own – consumed by the care system.

In theory, there might be an upside if the pressure of care costs pushed people into actually selling their homes. For as long as the planning system stops us building the millions of homes we need, the under-utilisation of family homes by older people is a national problem; I previously mooted a ‘Boomer bedroom tax’ as a means of addressing it.

Yet this seems unlikely to happen at scale, given the availability of various financial products that allow people to ‘unlock the value’ of their homes whilst retaining use of them in their own lifetimes. (A far-sighted government might do well to actually ban such instruments, but then such a government could obviate the need by passing planning reform.)

So we’re stuck. But part of the reason this row will keep on running is because despite everything above, it is still can’t help but feel unjust that there is one set of needs the state will meet for free, and another very similar set where citizens are expected to pay through the nose.

People encounter this division at different points. For older citizens, its physical ailments versus social care. For parents, its schooling versus pre-school childcare. It cannot help but rankle. 

And in a better designed system, so clear a cleavage would not exist. Those of us who could afford it would contribute more towards the costs of our ordinary healthcare and schooling, maintaining a broader array of options whilst bringing more money into both systems and allowing taxpayers’ money to be concentrated on the most vulnerable.

Prior to the advent of the post-war welfare state, such models were common. Some schools took fee-paying students who helped subsidise the education of children who attended for free; hospitals had pay beds, the profits of which were recycled into care for those who couldn’t afford it. 

Unfortunately, these were eclipsed by Labour’s fixation on state-run universal services. And whilst we’re inching back towards alternative models in some respects – experiments with low-cost private schools, NHS trusts that also provide private care – we’re a very long way from the sort of shift in public attitudes that might allow ministers to attempt comprehensive reform.

Until then, we are lumbered with the post-war mindset that things should be universally free – and the increasingly unsustainable cost of that means that what isn’t covered in full is going to be covered as minimally as possible.

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Henry Hill is Deputy Editor of ConservativeHome.