The introduction of a new tax on income to support social care funding is under consideration as part of Labour Prime Minister Andy Burnham’s social care reform plans. Officials within the Department for Health and Social Care (DHSC) have devised proposals that would require workers to make mandatory contributions to a privately managed national fund dedicated to covering care costs in later life.
These proposals aim to finance a revamped social care system estimated to cost around £18 billion annually. The initial plan was proposed by Re:State, a public services think tank where Mr Burnham recently served as an adviser before assuming the role of Prime Minister.
According to a paper published by Re:State, mandatory contributions could see an individual earning £50,000 expected to pay an additional £788 per year in tax. Those with salaries of £80,000 might contribute approximately £1,327 annually.
READ MORE: Andy Burnham Proposes £1,327 Tax on High Earners to Fund Social Care
Mr Burnham has consistently advocated for sweeping reforms in social care, warning that the NHS risks collapse if it continues to bear the strain of patients who could be better supported with adequate home care systems. He told the BBC on Monday: “I think there are major changes you can make before the next election. This costs the NHS billions of pounds, and we will never get the NHS back to good waiting time standards until we fix social care.”
In parallel, a source from the Liberal Democrats expressed surprise at the reluctance of Sir Keir Starmer’s government to collaborate with their leader Sir Ed Davey on social care reforms. The source commented: “Unless you manage to at least make an attempt at consensus, having a big majority means nothing. Because what happens is you ram it through parliament, and then the opposition parties just tear it to bits, and that’s what’s happened time and time again.”
Mr Burnham has pledged to use “whatever political capital I have” to transform the social care system in England, emphasising that “major changes you can make before the next election” are both necessary and achievable.
The Prime Minister is reportedly committed to exploring a care system that is free at the point of use, aspiring to one that “operates on the NHS principle.”