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At last some progress towards meeting the cost of social care?

Funding the cost of social care has been a problem that governments have wrestled with for more than 20 years. Pressure from leaders of the care industry, newspaper campaigns and accusations of broken promises by voters, along with the catastrophe in the care sector as a result of covid-19 has brought even more pressure to bear on the government.

Following the promise by Boris Johnson a year ago on the steps of Downing Street to resolve the situation it would seem that at last we may be seeing some action.

According to a recent report everyone over 40 would start contributing towards the cost of care in later life under radical plans being studied by ministers to finally end the crisis in social care, the Guardian can reveal.

Under the plan over-40s would have to pay more in tax or national insurance or be compelled to insure themselves against hefty bills for care when they are older. The money raised would then be used to pay for the help that frail elderly people need with washing, dressing and other activities if still at home, or to cover their stay in a care home.

The plans are being examined by Boris Johnson’s new health and social care taskforce and the Department of Health and Social Care (DHSC). They are gaining support as the government’s answer to the politically perilous question of who should pay for social care.

Governments preferred option

Sources say the principle of over-40s meeting the cost of a reformed system of care for the ageing population is emerging as the government’s preferred option for fulfilling the prime minister’s pledge just over a year ago to “fix the crisis in social care once and for all”. Social care is a devolved matter, but the plans could apply to the whole of the UK as they may involve the tax system.

Matt Hancock, the health and social care secretary, is a keen advocate of the plan. He has been championing it in discussions that have resumed recently about the government’s proposals to overhaul social care. Officials say there is a “renewed urgency” in Downing Street and the DHSC to come up with a solution.

The system that officials are considering is a modified version of how Japan and Germany fund social care. Both are widely admired for having created a sustainable way of financing social care to deal with the rising needs an ageing population brings.

In Japan everyone starts contributing once they reach 40. In Germany everyone pays something towards that cost from the time they start working, and pensioners contribute too. Currently 1.5% of every person’s salary, and a further 1.5% from employers or pension funds, are ringfenced to pay for care in later life.

Older people in Germany who have had their needs assessed can use the money to pay carers to help them with personal tasks at home, or for care home fees or even to give to relatives and friends for helping to look after them.

Adopting a similar approach would let Johnson say he has ended the situation whereby some pensioners deemed too wealthy to qualify for local council-funded care have to sell their homes to pay care home costs, which can exceed £1,400 a week.

One source with knowledge of the government’s deliberations said: “The latest thinking is that there’s a preference for some sort of Japanese-style model where once you are over 40 you start paying into a central risk pool. They are deadly serious about that.”

The Conservative MP Damian Green also sees payments by over-40s as the way to resolve the funding question.

However, the Treasury is understood to harbour doubts about moving in that direction. “There are vast differences of opinion within government about this,” the same source said. And it risks angering a generation who will have paid, or still be paying, off their student loans and may have a mortgage and the costs of rearing children to meet.

But a shift to over-40s paying more looks likely to find favour with campaigners. Caroline Abrahams, the charity director at Age UK, said: “Some older people may look askance at the idea of only the over-40s paying to fund a new national care system. However, if that’s what our government is considering embracing here than it may be rather a good deal, since that system offers a level of provision and reassurance that we can only dream of here at the moment.

Introducing a comprehensive and reliable system like that in Germany and Japan would “arguably be an appropriate act of national atonement after the catastrophic loss of life we’ve seen in care homes during the pandemic”.

The ex-Liberal Democrat MP Paul Burstow, who was social care minister in the coalition government from 2010-12 and is now chair of the Social Care Institute for Excellence, said: “Introducing an insurance contribution from the over-40s would help put social care on a firm footing for the future. This approach has already been adopted in other countries on a mandatory basis to ensure risk is fairly spread and sufficient funds are raised.” Whatever social care reform is decided upon needs to “avoid the lottery of huge lifetime care bills”, he added.


At last the government seems to be showing some urgency towards finding a solution to meeting the cost of social care. Ministers appear to be considering schemes adopted by Japan and Germany, which have been around for some time, so it should not be to difficult to evaluate the reasons for their success.

Whatever system is adopted must be fair and equitable, but I believe it will only work if it is applied on a mandatory basis. Social care needs an assured means of funding if it to plan and encourage new providers and staff to the industry.

Albert Cook BA, MA & Fellow Charted Quality Institute Managing Director Bettal Quality Consultancy

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