Social Care

[Yellow Fever 3,749]

This is surely, ultimately, for almost everybody,  one of most important topics to solve.

Many of us will one day need such care, yet few of us it seems are willing to pay or save for such a rainy day. The State must pay etc.

For what it's worth, as a boomer myself, I am appalled at the notion of putting it on NI but letting wealthy pensioners off scott free. Everybody should pay according to their means and that includes their capital assets

As to the NI cap itself - perhaps the age limit should be increased to 75 to reflect our ageing but often wealthy population ?

Edited September 5, 2021 by Yellow Fever

[Daz Sparks 1,151]

15 minutes ago, Yellow Fever said:

As to the NI cap itself - perhaps the age limit should be increased to 75 to reflect our ageing but often wealthy population ?

If this government made pensioners pay NI, they would be gone at the next election.

[Yellow Fever 3,749]

28 minutes ago, Daz Sparks said:

If this government made pensioners pay NI, they would be gone at the next election.

That just show the absurdity of the situation. I would like to believe (but don't hold out much hope) that us Boomers were not such freeloaders.

[BigFish 1,986]

To be fair to the Boomers they just demonstrate understandable self interest. The real issue is when this is translated into a belief they got what they have entirely through their own endeavours as opposed to the luck they had being born in a particular epoch. The answer is simple if you can look passed that. A National Care Service funded by higher capital gains and inheritance taxes combined with the merger of NI into Income Tax.

[Yellow Fever 3,749]

24 minutes ago, BigFish said:

To be fair to the Boomers they just demonstrate understandable self interest. The real issue is when this is translated into a belief they got what they have entirely through their own endeavours as opposed to the luck they had being born in a particular epoch. The answer is simple if you can look passed that. A National Care Service funded by higher capital gains and inheritance taxes combined with the merger of NI into Income Tax.

I don't disagree with this - I was just curious to peoples views. The issue I see is that this has needed fixing for decades - same as pension funding (most take out way more than they have ever paid in in benefits) but have always voted instead for tax cuts and to pass the buck onto future generations. Well its time to pay the piper -the buck stops here.

What I am against is the NI hike. It's important that the prime beneficiaries also contribute (or don't moan at all when the DHSS take a chunk of your house)!

[BigFish 1,986]

1 hour ago, Yellow Fever said:

What I am against is the NI hike. It's important that the prime beneficiaries also contribute (or don't moan at all when the DHSS take a chunk of your house)!

Hard to think of a more regressive step than a NI hike to pay for this.

[Van wink 2,994]

3 hours ago, Yellow Fever said:

 The issue I see is that this has needed fixing for decades - same as pension funding (most take out way more than they have ever paid in in benefits) but have always voted instead for tax cuts and to pass the buck onto future generations. 

 

Interesting viewpoint YF, do you have stats for that and is account taken of those who pay in for many years and then sadly never draw anything. Do you see the state pension as a benefit and would the principle of paying in more than you take out apply to all benefits. How about attendance allowance and benefits that enable people to be supported by social care hence not adding a further drain on the NHS.  How would the principle apply to other benefits? Should the elderly have NHS provision limited not by need but contributions paid?  A slippery slope in terms of the welfare state but maybe the way we should be going. Pensioner poverty has been a  real issue in my lifetime, and still is. I can recall providing grants to elderly folk who had no inside toilets and only one source of heating, heating only one room and living in that room throughout the winter. Many elderly women never even had the opportunity to make pension contributions during their lives.

Edited September 5, 2021 by Van wink

[keelansgrandad 6,679]

For once I am not blaming anyone but everyone with Social Care. Ever since Thatcher, Governments have been happy to deny there is a looming crisis.

The number crunchers must have been aware of what was coming and must have told ministers. But successive Governments have been content to ignore the problem and merely pass it between departments and changing legislation.

There has been no real change. For instance, the hotel where one of my sons had his wedding reception is now a care home and the charge is close to £1000 a week. You could put all the residents on a cruise ship for less than that a week. Or maybe pay a relative £600 a week to have them at home.

All benefits need a rethink.

For instance, why does the state pay £400 a month in rent allowance, which is probably paying the vendor's mortgage, when they could be contributing that to a mortgage for young couples.

 

[Yellow Fever 3,749]

14 hours ago, Van wink said:

Interesting viewpoint YF, do you have stats for that and is account taken of those who pay in for many years and then sadly never draw anything. Do you see the state pension as a benefit and would the principle of paying in more than you take out apply to all benefits. How about attendance allowance and benefits that enable people to be supported by social care hence not adding a further drain on the NHS.  How would the principle apply to other benefits? Should the elderly have NHS provision limited not by need but contributions paid?  A slippery slope in terms of the welfare state but maybe the way we should be going. Pensioner poverty has been a  real issue in my lifetime, and still is. I can recall providing grants to elderly folk who had no inside toilets and only one source of heating, heating only one room and living in that room throughout the winter. Many elderly women never even had the opportunity to make pension contributions during their lives.

Hi VW,

There has been a lot written about this over the last few years - but you could start here (just a quick search). It's obviously a complex subject and open to all sorts of slants. I don't vouch for this particular one right or wrong.

https://www.independent.co.uk/money/spend-save/baby-boomer-wealth-why-generation-x-millennials-retirement-savings-pensions-welfare-support-home-owners-a8200496.html

However to cut to the chase - the issue really is one of us boomers promising ourselves all sorts of state benefits in the past for retirement but never putting in place the funds (or funding streams) to cover them - not from us anyway. The explosion in social care costs, pensions etc. has been well predicted for decades because  - of us boomers - booming - the baby bubble - but we didn't want to address it.

One slippery argument (that us boomers now make) is that there is an intergenerational agreement that the next generation look after the previous. We as boomers looked after out parents etc. Trouble is they retired at 65 - and most were lucky to live much past 70 and then without the huge medical costs! It was how the state pension was originally envisaged/costed! Neither have we played particularly fairly the other way - student debt etc. (an equal explosion). If we had raised the retirement age to to say 70 for all 15 years ago we might have argument that we tried to be prudent / address the issue.

Anyway - I could go on. The real issue is care for those with no assets - that needs to be funded (and a certain karma if these costs rocket with the lack of 'EU' staff). Those with assets - well tough. Seems like many didn't think it through but now as per the 'Sheriff of Nottingham' we want to tax the poor to pay for us rich.

None of this argument is really about the the level of pensions (and yes they are defined as benefits) but just how we fairly fund them at whatever level.

[Van wink 2,994]

There’s no doubt YF that politically there has  long been inertia towards any change and politicians have been burned in efforts to overhaul the system. I can’t recall all the details of Theresa May’s “ dementia tax” , it was far from perfect, but I remember my feeling at the time was that  there was at least an attempt to do something, which was crashed for mainly political gain. Again BJ is having a go at it and it will burn him too, I do agree that using NI contributions is regressive but something has to be done, this can has been kicked too many times.

[Yellow Fever 3,749]

1 hour ago, Van wink said:

There’s no doubt YF that politically there has  long been inertia towards any change and politicians have been burned in efforts to overhaul the system. I can’t recall all the details of Theresa May’s “ dementia tax” , it was far from perfect, but I remember my feeling at the time was that  there was at least an attempt to do something, which was crashed for mainly political gain. Again BJ is having a go at it and it will burn him too, I do agree that using NI contributions is regressive but something has to be done, this can has been kicked too many times.

Totally agree something must be done - and although I was no fan of May - I thought the so called 'Dementia Tax' was sensible even if the electorate aren't! 

Just scanning that old article that I linked it made a compelling point that keep taxing the income of workers was ultimately long term unviable given the changing  demographics and wealth - hence we have to cross the Rubicon at some point and tax wealth. So if Johnson's fix is going to be anything other than a sticking plaster he might as well go for it. Certainly pensioners should, indeed must contribute. No opting out.

As an aside I've seen this several times - pensioners who retired many years (decades) ago - not rich by usual standards but own a house (bought on 2 or 3 times a modest salary) - probably a good private pension but then scream and shout they have to self fund.

Edited September 6, 2021 by Yellow Fever

[keelansgrandad 6,679]

I remember speaking to a young chap who said he would never need social care so why should he pay for it.

Its a dilemma. As with anything, people are paying up to fifty years ahead and there is a belief that it is too far away and they will sort it out later rather than sooner.

 

[BigFish 1,986]

What is forgotten here is the Tax System is designed with the purpose of allowing certain cohorts to avoid, rather than pay, tax. Open disclosure, I had a period of self emplyment and a good accountant. The result of this was I paid NO income tax or NI at all. I did pay corporation tax at 19% and dividend tax at 7% but as you see that arrangement was far better financially for what would have been a higher rate tax payer than PAYE. All perfectly legal too. I have never voted Conservative, but they certainly look after people like me.

[keelansgrandad 6,679]

2 hours ago, BigFish said:

What is forgotten here is the Tax System is designed with the purpose of allowing certain cohorts to avoid, rather than pay, tax. Open disclosure, I had a period of self emplyment and a good accountant. The result of this was I paid NO income tax or NI at all. I did pay corporation tax at 19% and dividend tax at 7% but as you see that arrangement was far better financially for what would have been a higher rate tax payer than PAYE. All perfectly legal too. I have never voted Conservative, but they certainly look after people like me.

A system that the few Labour Governments we have had since Harold Wilson, have failed to reform.

Why is taxation reform so unimportant to the ordinary citizen?

[BigFish 1,986]

36 minutes ago, keelansgrandad said:

A system that the few Labour Governments we have had since Harold Wilson, have failed to reform.

Why is taxation reform so unimportant to the ordinary citizen?

KG, the answer to that is few ordinary citizens actually understand it, or what other citizens are doing, or wealth distribution in the UK. The average Joe or Joanne is duped into thinking that everyone is tied into PAYE and any reform by Labour will mean they pay more tax. The regular furore over inheritance tax is a case in point, the thresholds are so high that you are a millionaire before it becomes an issue but any attempts to broaden is a "death tax". A 10% levy on bequests would raise enough to have a £200billion soveriegn wealth fund that could address many of society's ills,

[Well b back 3,190]

Could we not transfer some of the £350 million a week we were giving the NHS to social care.

[Yellow Fever 3,749]

Well we're all waiting  - I see leaks as to an £85,000 cap to help our wealthier pensioners and as a fop to the inter-generational issues it will be levy on working over 66 'pensioners' too. If so why not just put it on income tax and tax all income - earned our otherwise. Then we have that it will all go at first to the NHS with Social Care to get what left in a few years. Hmm. I smell humbug and fudge.

If this is true Johnson has dropped the ball yet again - thanks for NI increase (and on pensioners) to help fund the NHS but Starmer or whoever will still have to properly fix Social Care in due course as this doesn't. That would be my attack line anyway. 

[Herman 9,717]

Humbug and fudge it is then. A necessary plan is needed, in part to cover the mess that austerity caused, but is being dumped on workers rather than spread around to all the people concerned. Pathetic really. 

Edited September 7, 2021 by Herman

[PurpleCanary 5,554]

On 06/09/2021 at 14:58, BigFish said:

What is forgotten here is the Tax System is designed with the purpose of allowing certain cohorts to avoid, rather than pay, tax. Open disclosure, I had a period of self emplyment and a good accountant. The result of this was I paid NO income tax or NI at all. I did pay corporation tax at 19% and dividend tax at 7% but as you see that arrangement was far better financially for what would have been a higher rate tax payer than PAYE. All perfectly legal too. I have never voted Conservative, but they certainly look after people like me.

Now if a boomer like me had pulled that wheeze, BF...

[Rock The Boat 1,326]

We have in this country a pretty good system of digital wallets which people usually topup on a monthly basis from their salaried income and after a period of around twenty-five years they are gifted a nice little wealth-bearing asset. Only we don't normally refer to this as a digital wallet, we usually call it a mortgage. And the great thing is that you actually get to live in the asset (house) that you don't actually own until the twenty-five year period is up. We don't have to live this way. We could have a system of socialised housing whereby the government allocates you a house on which you pay rent until you die. In fact, we do have a system of socialised housing which is mainly used by those who can't or won't access the mortgage-paying route for whatever reason. Most people seem to be happy with this two-tier solution to housing, and the majority seem to prefer the mortgage-paying solution as there are obvious benefits - one has a choice of what kind of house one gets to live in (within the constraints of income), one ends up with ownership of a valuable asset, and one can pass this asset on to friends, relatives or one's cat if one so wishes.

Housing isn't the only social benefit that runs in a two-tier system. If one works for a certain number of years, one pays National Insurance contributions which on retirement pays a pension of around £500 per month. Not a lot of money for most of us. But in addition to the state pension, most of us have a workplace pension, which nowadays is compulsory for most new job starters (I think there are a few exceptions), which are, like mortgages, funded mainly from salaried income.

So we already have two systems, both long-term commitments which have a basic benefit underwritten by the government and a topup element in which the end user or beneficiary has the freedom to fund as much or as little as he wants or is able (within certain boundaries, and it is two systems that work reasonably well and solves the problem of housing and retirement income for the majority of people. Now this is not to recognise that the basic provisions are not always a desirable outcome and there are always people who are going to do badly if they are dependant on the basic provision and we have to address those problems as well. But for the majority of people they are served well by a two-tier system of housing and pension financing.

But when it comes to health care - and social care being part of health care - we are ideologically hamstrung by having a single-tier health system. We seem to be afraid to have the conversation about health care and how we can properly finance it. It's a taboo subject and I bet that already there are posters flexing their digits towards the quote button to argue that talking about this subject is off-limits. Yet social care is not that much different from pension provision in character. It's a need that can be foreseen, it's forecastable in the long-term, the beneficiaries are easily identifiable and make up a discrete entity. It's also a good principle that the user of any service should be the one who pays for the service. If these factors are true then social care ought to become a two-tier system like some of our other systems. That is a social care fund that is paid into during the working life of a person, as little or as much as they choose, and then a payout for social care based on the size of the fund and actuarial rules to determine for how long the payouts would last. This is basically an insurance policy and something that the insurance market would be very good at providing. There are a few other considerations here. What happens to the houses of those going into social care? I see no reason why they should not be sold to fund social care. We don't stop retirees from selling homes to finance their pensions and the only people who seem to be against this are relatives hoping to get an inheritance. 

I also don't believe social care should be financed through higher NI payments. That is asking working people to finance those who are in the main doing quite well out of home ownership and generous pensions. And this is probably a good time to scrap NI completely as it is a tax on jobs. If we are re-organising income tax and NI, we can at the same time reorganise state pension contributions and social care contributions into a single digital wallet application and give people the flexibility of how they want to make contributions and how they want to take benefits so that you end up with a goal of allowing people to have more choice over how they manage their social benefits wallet instead of trying to apply a one-size fits all to everybody.

[Yellow Fever 3,749]

23 minutes ago, Rock The Boat said:

 

There are a few other considerations here. What happens to the houses of those going into social care? I see no reason why they should not be sold to fund social care. We don't stop retirees from selling homes to finance their pensions and the only people who seem to be against this are relatives hoping to get an inheritance. 

I also don't believe social care should be financed through higher NI payments. That is asking working people to finance those who are in the main doing quite well out of home ownership and generous pensions. And this is probably a good time to scrap NI completely as it is a tax on jobs. 

Broadly RTB I agree with you. I just can't see the real argument that those who live in expensive often SE homes should in some manner be allowed to keep or pass on these assets unfettered if other costs are needed to be met for their health.

Yes there needs to be a catchall like the NHS - it will save your life but you can always pay extra for private room in a private hospital (but no better actual care). Too many elderly asset rich people want it all ways it seems.  

I can appreciate Johnson has done something (it's taken decades but a bounced vote tomorrow - no time to digest - pure madness as usual from this lot) but it seems a very contorted method to add an additional 'tax' - no doubt with endless possibilities to avoid. Simplify the lot. Income Tax only. Past time.

[keelansgrandad 6,679]

Its another fudge. Its not just about the money. Its about the need to care for an ever enlarging elderly population. The attitude toward the elderly by their families, neighbours and the state.

 

[ricardo 7,348]

2 minutes ago, keelansgrandad said:

Its another fudge. Its not just about the money. Its about the need to care for an ever enlarging elderly population. The attitude toward the elderly by their families, neighbours and the state.

 

As always, the future will be much like today, only more expensive.

[keelansgrandad 6,679]

Just now, ricardo said:

As always, the future will be much like today, only more expensive.

And more of it.

[Herman 9,717]

3 minutes ago, ricardo said:

As always, the future will be much like today, only more expensive

...... for some but not for others, especially the ones that can afford to pay a little more. 

[ricardo 7,348]

Suspending the triple lock this year is surely the correct decision.

[Herman 9,717]

1 hour ago, ricardo said:

Suspending the triple lock this year is surely the correct decision.

Yes. But will it be a sticking plaster for a problem that needs serious long term ideas?

[Van wink 2,994]

1 hour ago, ricardo said:

Suspending the triple lock this year is surely the correct decision.

Yeh has to be

[Van wink 2,994]

22 minutes ago, Herman said:

Yes. But will it be a sticking plaster for a problem that needs serious long term ideas?

I think the triple lock has been universally accepted as a good idea and has lifted many out of poverty, why is it a sticking plaster?

[Rock The Boat 1,326]

I posted before the social care measures were announced, and yes it's a fudge, steering a course round all the various interest groups instead of tackling the underlying issues. There's no better time to have a fundamental review of all social provisions than when you're sitting on an eighty seat majority. So if not now, then when would be a better time? Politicians can't stop behaving like politicians with a short term mentality. This year the triple lock throws up a statistical anomaly that would benefit pensioners far more than other groups so it is right not to apply it this time around.