The coalition fails to rise to the challenge on social care

The £75,000 cap on costs planned by the government will help just 10 per cent of those needing care.

More than 18 months after Andrew Dilnot's landmark report into social care was published, the coalition will finally unveil its planned reforms today. In a statement to the Commons, Jeremy Hunt will announce that the government will introduce a cap of £75,000 on care costs and increase the threshold for means-tested support from £23,250 to £123,000, so that no one with assets worth less than this amount is forced to pay. The £1bn-a-year cost of the plan will be met through higher national insurance contributions on employers and a six-year freeze in the inheritance tax threshold at £325,000 (George Osborne's famous 2007 pledge to increase it to £1m now being a distant memory of a pre-austerity age). 

The first point to note about the £75,000 cap is that under the coalition's timetable it won't actually be introduced until April 2017. Thus, as shadow care minister Liz Kendall has noted, it "won't do anything for the hundreds of thousands of elderly and disabled people who are facing a desperate daily struggle to get the care and support they need right now".

In addition, the cap, which excludes food and accommodation costs (typically around £7,000-£10,000 a year), is set a significantly higher level than that recommended by Dilnot. His report called for a cap of between £25,000 and £50,000 (settling on a figure of £35,000) and warned that anything outside of this range "would not meet our criteria of fairness or sustainability". A cap above £50,000 "could mean people with lower incomes and lower wealth would not receive adequate protection." Even if we adjust the £75,000 cap for inflation (it is based on 2017 price levels), that still leaves it at £61,000 - £11,000 higher than Dilnot's recommended maximum.

Interviewed on the Today programme this morning, Dilnot said that he regretted the coalition's decision to opt for a £75,000 cap but recognised that "the public finances are in a pretty tricky state". By capping costs for the first time, the plan would still "radically reduce anxiety", he argued. But others have been less generous. 

Labour has pointed out that since it will take the average person around four years before they reach the cap, it will not benefit the majority of patients, most of whom don't make it this far. Dot Gibson, the general secretary of the National Pensioners Convention, estimates that the proposals will help "just 10 per cent of those needing care". Labour is currently developing its own social care plan as part of its policy review but is likely to recommend a cap no greater than £50,000. 

The government's hope is that a cap of £75,000 will encourage insurers to offer policies to cover costs below this amount. As Hunt said on The Andrew Marr Show yesterday, "We don't want anyone to pay anything at all. By setting an upper limit to how much people have to pay, then it makes it possible for insurance companies to offer policies for people to have options on their pensions so that anything you pay under the cap is covered."

But Labour is highlighting the fact that Nick Starling, the director of general insurance and health at the Association of British Insurers, has previously dismissed this as wishful thinking. He told the health select committee in November 2011: "I do not think there will be pre-funded products. That is unlikely. I speak on behalf of the insurance industry, but I bring independence in the sense that, except for the immediate needs annuities which [Chris] Mr Horlick [of Care Partnership Assurance] provides, there are no products out there. I am not grinding a particular axe about particular forms of products. I am saying that, in a sense, we have a chance to think in quite an open way, unencumbered by a whole forest of products already out there. In that sense, the thinking we have been doing on this is independent."

A cap on costs is, as Dilnot suggested, better than no cap at all. But unless Hunt springs a surprise on MPs today, it is already clear that this will not be a lasting solution to the care problem. For that, one suspects, we will have to wait for a change of government.  

Health Secretary Jeremy Hunt will announce the government's planned social care reforms today.

George Eaton is political editor of the New Statesman.

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Leader: Europe and the long shadow of war

Amid the rancour, it is easy to forget what drove European integration in the first place: the two great wars in the first half of the 20th century.

Amid all the claims and counterclaims about David Cameron’s so-called renegotiation of Britain’s membership of the European Union, it is often forgotten, or conveniently ignored, just how successful the European project has been in helping to create and maintain the post-Second World War peace order.

We support continued British membership of the EU but are sceptical of the imperial ambitions of the European elites. We opposed British membership of the single currency, a decision that the eurozone crisis has vindicated. It is obvious that the Schengen Agreement is unravelling and in all likelihood is unsustainable, as embattled nation states reimpose emergency border controls and the continent grapples with its worst refugee crisis since the end of the Second World War. Like the British government, we are opposed to further political and economic integration and to the creation of a federal or quasi-federal superstate.

However, at a time of profound instability in the world, we accept that it would be foolish for the United Kingdom to retreat from our various multilateral peace alliances – whether that be membership of the EU or, indeed, Nato (as some on the left would wish) – all of which involve some kind of surrender of sovereignty.

Amid the rancour, it is easy to forget what drove European integration in the first place. The two great wars in the first half of the 20th century racked the continent, with neighbouring armies slaughtering each other on a scale that still defies comprehension. As Alistair Horne writes on page 22, “the most atrocious battle in history” began a century ago next week in Verdun, France, on the Western Front. The German army hoped to lure the enemy into a trap and then “bleed the French army white” using its superior firepower. Yet the rivers of blood flowed both ways: in ten months, over 25 square miles, pounded by heavy artillery and poisoned with gas, 300,000 French and German soldiers died.

The lessons of the battle were not quickly learned – the carnage of the Second World War was still to come – yet ultimately they were. In 1963, France’s Charles de Gaulle, who was wounded at Verdun, signed a treaty with the then German chancellor, Konrad Adenauer, binding two countries that had engaged for centuries in tit-for-tat wars in an enduring nexus of co-operation. The aim, as David Reynolds notes in his article on page 28, was “to free the next generation from the vice of nationalism”.

Two decades later, President François Mitterrand, who fought near Verdun in 1940, and Chancellor Helmut Kohl, whose father served there in 1916, attended a commemoration ceremony at one of the battle sites. In what became an iconic image of reconciliation at the heart of Europe, Mitterrand impulsively gripped Kohl’s hand during their national anthems. The two men were later the architects of the Maastricht Treaty, which created the European Union under its current name.

These are troubling times for Europe. Confidence and optimism are low. The wars in the Middle East and the rise of Islamic State, Russian revanchism and financial and economic turbulence have dented the morale of even the most committed liberal Europhiles. In addition, the EU seems unable or unwilling to control or police its borders, just as it has been unable to bring an end to the crisis in the eurozone. Nor is it any closer to forging a common foreign policy, let alone forming a common European army that might be necessary in future years to patrol the outer edges of the continent.

“Unless the EU can find solutions to the problems Europe is facing that are acceptable to its members . . . the Union will be on a glide path to collapse,” wrote the historians Brendan Simms and Timothy Less in a recent issue of the New Statesman. And yet, for all its flaws and present difficulties, the EU remains a force for stability in the world. It embodies the liberal, rules-based order without which barbarism and war are never far away, as the centenary of the Battle of Verdun so poignantly reminds us. 

This article first appeared in the 11 February 2016 issue of the New Statesman, The legacy of Europe's worst battle