Andrew Dilnot’s proposals for the future funding of social care demonstrate just how fine a balancing act is required.
Dilnot’s core proposal, to cap an individual’s contribution to their care in later life at £35,000 and raise the means-tested threshold to £100,000, has been met with both praise and opposition with the notion of ‘fairness’ being the yardstick around which this debate is taking place.
Critics of the Dilnot report ask how the proposed cap on an individual’s contribution that is not a percentage of income, coupled with a revision of the means-tested threshold is ‘fair’, when it could be argued to serve to disproportionately benefit the wealthiest in UK society? Supporters of the Dilnot report respond that the current system fails to protect the assets that individuals have accrued over a lifetime of hard work, and as such the current funding arrangement cannot be considered ‘fair’.
If Dilnot’s proposals were to be implemented, once an individual’s social care exceeded the cap of £35,000 the state would fund the remainder of the required care through general taxation. Opponents argue this means that the rich pay proportionally less for their care and the less well-off pay proportionally more.
Welfare systems are systems of social stratification that actively order social relations, building broad or narrow solidarities across populations. They can be redistributive and /or entrench existing social divisions. Dilnot’s proposals, his critics argue, are far from redistributive, and would serve to inhibit the transference of wealth from the haves to the have-nots.
Take the potential impact of Dilnot on housing and the redistribution of wealth as an example. Owning property is a means of entrenching wealth. Those critical of the proposals argue that by negating the need for individuals to raise equity through the sale of their house(s) to support their care in older life, Dilnot’s cap would prevent un-mortgaged equity being released into the economy, preserving and further entrenching the inheritances of the well-off across generations. In essence, the proposals could act as an obstacle to the redistribution of wealth and are, it could be argued, ‘unfair’.
But then how ‘fair’ is the status quo? Those calling for the implementation of Dilnot’s proposals argue that not only does the Dilnot Report provide a way forward in the nation’s acute need for a new social care funding relationship between the state and the individual, but that Dilnot’s proposals are a much fairer way forward. Under the existing means-tested system an individual is expected to fund their own care until the value of their assets falls below £23,250 (in England), at which point the state foots the remainder of the bill. The rich pay more for their care and the less well-off pay less.
The underlying issue here is that the current system fails to reward those who are prudent savers, having accrued assets carefully over a life time. Where is the incentive to save for old age when those who haven’t done so immediately qualify for state funded care? Why should some individuals exhaust their assets while others have no need to do so? How can this situation be deemed ‘fair’?
Most observers would agree that the ultimate aspiration would be to provide a model for social care funding that guarantees support for everyone in need, that does not place a disproportionate burden on the less well-off and that doesn’t disincentivise financial prudence. It will be fascinating to see how these competing needs impact on the adoption of Dilnot’s proposals over the coming months.