When it comes to social care, successive governments never miss an opportunity to miss an opportunity.
Labour’s mindless decision to set up a social care taskforce headed by Baroness Casey, which won’t report until 2028, kicks a perennial problem into the long grass.
Some 14 years have passed since the publication of Andrew Dilnot’s thorough-going report on paying for social care. In 2019 Boris Johnson stood on the steps of Downing Street and vowed to make reform of social care a priority.
His government planned to pay for a new service through a 1.25 per cent ‘health and social care’ levy, with the funds raised being ring-fenced. Instead, the receipts fell into the black hole in the public finances after the Covid-19 pandemic.
Meanwhile, the pathway from hospital into social care remains blocked.
An elderly cousin spent five unnecessary weeks in the Royal Sussex County Hospital in Brighton last summer waiting for a social care package.
Lessons to be learned: Keir Starmer should learn from the post-war Attlee Labour government which didn’t tarry and rapidly legislated for a ‘cradle-to-grave’ welfare system
There are countless similar stories. The answer to the funding problem is in plain sight. In the years following the establishment of ‘opt-out’ private pensions, as created by Adair Turner’s commission, some £30billion has been accumulated in the National Employment Savings Trust and countless more billions in defined contribution pension schemes. Very few people opt out of a plan where funds are collected at source from pay packets.
Imagine how much cash would have been collected for social care, both at-home and in-care facilities, had a similar opt-out plan been set up at the time of Dilnot with low-level contributions.
One recognises there would be objections. Some on the Left argue that young people should not be required to pay into a fund for rich pensioners. The answer is that young people could opt out. But by so doing, they would not qualify for assistance should misfortune occur during their working life or in retirement.
Health Secretary Wes Streeting could learn from other G7 nations. In Germany, long-term care is levied on the income of working people and pensioners, at a rate of 3.05 per cent for those with children and 3.3 per cent for those without. In Japan, with its rapidly ageing and long-living population, everyone older than 40 must pay into the long-term care fund. Only those above 65 can make use of the system.
The British Government’s idea of a new National Care Service is a great PR catchphrase. Starmer should learn from the post-war Attlee Labour government which didn’t tarry and rapidly legislated for a ‘cradle-to-grave’ welfare system.
Steely decision
Labour’s economic thinking was, until Donald Trump’s election, closely aligned with Joe Biden. Ministers would do well to look at how the Committee on Foreign Investment in the US (CIFUS) and the soon-to-leave Biden White House are handling the £11.4billion bid by Japan’s Nippon Steel for Pittsburgh-based US Steel.
In the face of a hefty lobbying campaign by both Nippon and US Steel seeking approval of the deal, the departing president has blocked the transaction on national security grounds. Steel is seen as a strategic industry. As significantly, the CIFUS review expressed concern that if Nippon’s global business interests required, pledges made to the US government on keeping furnaces burning and saving jobs would be dumped.
Business Secretary Jonathan Reynolds, the unions and other stakeholders would do well to bear this in mind, given the simple-minded faith placed in promises made by Czech Sphinx Daniel Kretinsky to secure control of the Royal Mail. He has vowed to maintain jobs, pay increases and the universal service at the Royal Mail for five years. Such commitments have rarely proved enforceable. Should there be global recession or interest rates soar, the economics of Kretinsky’s £3.6billion bid will change.
Postal workers and consumers could pay a heavy price.
Tilting at windmills
Donald Trump’s plea to ‘open up’ the North Sea and get rid of windfarms will be seen as very unwelcome by Energy Secretary Ed Miliband. It shows the scale of the problems UK Ambassador to Washington Lord Mandelson faces in renewing the special relationship with the US. Energy security, jobs and tax revenues should not be sacrificed on the altar of climate change.
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