National Insurance rise expected to fund social care – reports

A Conservative manifesto pledge is reportedly due to be broken through the raising of National Insurance to fund social care.

The Times newspaper reported on Tuesday that Boris Johnson was expected to announce plans to raise National Insurance payments by one percentage point for employers and employees to raise £10 billion a year to help support the ageing population.

And on Monday the PM declined to rule out the prospect of tax rises to pay for his long-awaited social care plan.

But despite saying he did not recognise reports in the newspapers, business minister Paul Scully told Sky News: “We’ll see what happens in terms of when we announce our details on social care.”

He said: “What we do want to happen is to make sure that we can come up with a comprehensive programme to tackle social care. It’s been around for a long time this issue, and we really do need to get to grips with it, and that’s what the Prime Minister and the Health Secretary are really determined to do.”

The Prime Minister said he would soon set out how to respond to the challenge of the cost of social care, two years since he used his first speech as Prime Minister to promise to “fix the crisis in social care once and for all with a clear plan we have prepared”.

Reports have suggested a plan is imminent, with the Prime Minister said to have concluded more tax will be needed.

But shadow economic secretary Pat McFadden said paying for social care must be fair to all income groups and all ages.

The Labour MP told Sky News: “There’s been a social care problem in the country for many, many years. We know we’ve got to fix it, the Covid pandemic has shown us the problems in the system, and we understand that’s got to be paid for.

“And again, with a tax proposal, which has been briefed to one or two newspapers, the best way to judge it is on two criteria.

“One: does it really fix the problem in social care? And secondly, is it fair to people of all ages, and all income groups?”

Paul Johnson, head of the Institute for Fiscal Studies, told The Times: “Funding social care just from National Insurance would be very inequitable. It would be a continuation of a long-term policy of hitting those of working age while protecting pensioners even for something designed to benefit people well over pension age. It’s a question of fairness.”

At a press conference on Monday, Mr Johnson was asked whether the 2019 Tory election manifesto commitment not to raise income tax or national insurance remained in place.

The Prime Minister sidestepped the question but said the problem of social care had “bedevilled governments for at least three decades”.

Chair of representative body the Independent Care Group, Mike Padgham, cautiously welcomed the progress.

He said: “We have long campaigned for better funding for social care and believe that people would be prepared to pay a little more in taxation or National Insurance, or a combination of both, in return for a properly-funded, fair social care system.

“This might not be the perfect solution to everyone, but we have to make a start and refine as we go along, rather than keep talking.”

However, the GMB union said raising National Insurance would hit the lowest paid.

Rachel Harrison, GMB National Officer, said: “We can debate the merits of how social care should be funded, but GMB does not back raising regressive national insurance which would hit the lowest paid workers.

“Any investment in adult social care must come with ringfenced cash to improve the pay, terms and conditions of workers across social care to reflect the skilled and valued job they do.”