Will the coalition waste this chance to reform social care?

Osborne must not be allowed to strangle Dilnot's proposals at birth.

It was as long ago as 1997 that Tony Blair told the Labour Party conference: "I don't want [our children] brought up in a country where the only way pensioners can get long-term care is by selling their home." Nearly 14 years later, however, more than 20,000 pensioners do exactly this every year.

The publication of the Dilnot Report provides the coalition with a chance to succeed where Labour failed and reach agreement on a long-term solution to the care crisis. As expected, Dilnot, the former director of the IFS, has proposed a cap of around £35,000 on care costs (the report suggests any figure between £25,000 and £50,000 would be acceptable), and a rise in the means-tested threshold from £23,250 to £100,000. Since the cap does not take into account the cost of food and accommodation, Dilnot has also called for a separate cap of between £7,000 and £10,000 on these "hotel costs".

His proposals have been erroneously portrayed by some as another "tax on the middle classes". But the reverse is true. Under Dilnot's plan, the middle classes will pay less (the average bill is currently £50,300, with one in five facing costs of £100,000), while the state pays more. A £50,000 cap would cost the government £1.3bn, while a £25,000 cap would cost £2.2bn.

It's for this reason that some are already suggesting that the government, in the form of George Osborne, will strangle the proposals "at birth". One cabinet minister tells Benedict Brogan: "It's DOA, there's no doubt about it ... At a time like this we simply can't afford it. We'll have to return to this issue at a future date." To which one can only reply: hogwash. Any new system is unlikely to come into effect until 2015, by which time, if Osborne's calculations are to believed, much of the deficit will have been eradicated. Short-term fiscal considerations must not act as a barrier to long-term reform. The Lib Dems' imaginative proposal to introduce capital gains tax on profits from first homes above £1m is just one example of how the state could raise more from the asset rich.

The coalition also has rare opportunity to forge a cross-party consensus on this issue. The last attempt to do so was, of course, destroyed by the Tories, who cynically attacked Andy Burnham's proposed compulsory levy as a "death tax". Despite the Tories' electioneering, however, Ed Miliband, has made a "genuine and open" offer to reach agreement. It is one David Cameron must take. Along with Miliband, every charity in the land is agreed that delay is no longer an option.

Asked earlier today what his response would be if the proposals were "kicked into the long grass", Dilnot rightly replied: "Astonishment". The longer ministers prevaricate, the worse the crisis will get. If the Lib Dems want a chance to prove that they can exercise real influence on government policy, here it is.

George Eaton is political editor of the New Statesman.

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The big problem for the NHS? Local government cuts

Even a U-Turn on planned cuts to the service itself will still leave the NHS under heavy pressure. 

38Degrees has uncovered a series of grisly plans for the NHS over the coming years. Among the highlights: severe cuts to frontline services at the Midland Metropolitan Hospital, including but limited to the closure of its Accident and Emergency department. Elsewhere, one of three hospitals in Leicester, Leicestershire and Rutland are to be shuttered, while there will be cuts to acute services in Suffolk and North East Essex.

These cuts come despite an additional £8bn annual cash injection into the NHS, characterised as the bare minimum needed by Simon Stevens, the head of NHS England.

The cuts are outlined in draft sustainability and transformation plans (STP) that will be approved in October before kicking off a period of wider consultation.

The problem for the NHS is twofold: although its funding remains ringfenced, healthcare inflation means that in reality, the health service requires above-inflation increases to stand still. But the second, bigger problem aren’t cuts to the NHS but to the rest of government spending, particularly local government cuts.

That has seen more pressure on hospital beds as outpatients who require further non-emergency care have nowhere to go, increasing lifestyle problems as cash-strapped councils either close or increase prices at subsidised local authority gyms, build on green space to make the best out of Britain’s booming property market, and cut other corners to manage the growing backlog of devolved cuts.

All of which means even a bigger supply of cash for the NHS than the £8bn promised at the last election – even the bonanza pledged by Vote Leave in the referendum, in fact – will still find itself disappearing down the cracks left by cuts elsewhere. 

Stephen Bush is special correspondent at the New Statesman. He usually writes about politics.