Inside Westminster

Boris Johnson’s government might look chaotic – but there is some method in its madness

The government is right to increase taxes for social care, but it has to make sure it genuinely follows through with much-needed reform of the sector, writes Andrew Grice

Friday 23 July 2021 12:35 EDT
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When Johnson trumpets a big social care budget, we should remember it needs to rise just to meet demographic pressures
When Johnson trumpets a big social care budget, we should remember it needs to rise just to meet demographic pressures (PA)

Boris Johnson’s government might look chaotic at times, but there is some method in there – if you look hard enough. After finding a rare spending cut supported by a majority of people (overseas aid), it will soon copy Gordon Brown’s 1 per cent increase in national insurance contributions, a rare popular tax rise.

As chancellor in 2002, Brown raised money for the NHS, while Johnson will do it for social care. As then, opinion polls suggest people are prepared to pay more national insurance; they like its original, if now eroded, contributory principle. “Insurance” has a warm, reassuring feel; we are used to paying for it.

But Downing Street and the Treasury have not yet prepared the ground in the way Brown did for more than a year. His path was not always smooth. Labour got in a pickle at the 2001 election when he refused to rule out a rise in national insurance (unlike the 2019 Tory manifesto, which pledged not to raise the rates of income tax, national insurance and VAT). Luckily for Brown, Labour’s chaos was literally knocked off the front pages when John Prescott thumped a man who threw an egg at him in North Wales.

Although confirmation of the national insurance rise won’t happen until the autumn, Johnson, Rishi Sunak and Sajid Javid, the health secretary, have agreed the move in principle. They should think again because it would be much fairer to young adults and low earners to increase income tax. The problem: they know that would be less popular with the public. A 1p rise in income tax rise would win Labour’s support, unlike the proposed national insurance increase, guaranteeing a Commons majority for it. The current plan could be blocked by an alliance of Labour and rebel Tory MPs opposed to any tax rise.

The government is right to increase taxes for social care but there is now a real risk it will have to share the estimated £10bn raised with the NHS, which would not leave enough for the reforms the care sector desperately needs. The carers we clapped must be properly rewarded. Half are on the national minimum wage of £8.91 an hour; they should get parity with NHS support workers on £10.90 an hour. Otherwise a staffing crisis – with 120,000 vacancies – will continue, and even deepen in November when, according to an estimate slipped out by the government, about 40,000 care workers are expected to be sacked or quit their jobs over Covid vaccinations becoming compulsory.

This once-in-a-generation shake-up must be underpinned by enough money to prevent care homes going bust; many are still on the brink and have not recovered from a Covid-19 pandemic which saw 38,000 deaths in them. Supporting people in their own homes should be encouraged. A good investment would be a week’s respite care for the unsung heroes caring for a member of their own family.

When Johnson trumpets a big social care budget, we should remember it needs to rise just to meet demographic pressures. The number of over-80s is expected to double from 3.4 million in 2020 to 6.9 million in 2050.

Despite all these pressures on the sector, there are growing signs Johnson and Sunak could use their extra revenue to tackle the record NHS’s record 5.3 million waiting list, the timebomb of long Covid, and to meet part of the £2.2bn cost of the 3 per cent pay rise for NHS workers (which would normally be fully funded by the Treasury).

The suggestion in Whitehall is that these issues would be addressed first, with the Cinderella of social care having to wait its turn. But the government can’t spend the same pot of money four times.

How the revenue is spent will be an acid test of whether health and care system will become a more preventative system. A new NHS structure in England from next April is supposed to deliver integrated care to reduce the number of old people who end up in hospital. But that vital long-term shift will be in jeopardy if the new money is thrown at hospital waiting lists to ease a short-term political headache for the Tories.

Johnson's long-overdue social care reforms, promised two years ago this Saturday when he became prime minister, will fail unless they are properly funded. Care can no longer remain the poor relation of the NHS; if it is not finally put on an equal footing, it will continue to put pressure on hospitals.

Despite that, the fear in the care sector is that the government will repeat the cycle of the last 25 years by offering, as one insider put it, “more jam tomorrow”. The pandemic has proved beyond doubt that it needs it now.

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