Get the vulture capitalists out of social care
When Boris Johnson became Prime Minister in July 2019, he stood on the steps of Downing Street and announced that he had prepared a plan to “fix the social care crisis once and for all.”
After waiting 775 days we are finally about to see it. Though it is not what many had hoped for, least of all Conservative Party MPs. Tory backbenchers are in uproar over reports that the Prime Minister plans to raise national insurance to pay for increased funding for social care.
This would clearly break the Conservative Party’s 2019 manifesto commitment not to raise taxes. That is the pledge every Tory election candidate made to the British people. Now many of them are worried about the consequences of Boris’s betrayal.
But not only is a national insurance tax rise bad for the Conservatives politically, it is also a bad policy for our country. Under the plans working people will foot the bill. It is a tax on jobs that will fall primarily on workers and small businesses.
The proposed £86,000 cap on care costs benefits those who live in areas with high property prices and discriminates against those who live in areas where prices are low.
The average price of a house in Boris Johnson’s constituency is £500,000. In my area it is £130,000. So his cap leaves Uxbridge families with a £414,000 inheritance – eight times more than £44,000 for families in South Elmsall, in my patch.
It isn’t levelling up is it? It’s doubling down on everything that’s wrong with this government.
Our social care system desperately needs more funding after a decade of savage cuts. Between 2010
and 2019, £7.7 billion was taken out of social care budgets as a result of the huge cuts handed down to local authorities by the Tory government.
This has resulted in 1.4 million elderly people not having the care they need for essential daily tasks like getting washed and dressed, according to Age UK.
Now the pandemic has further exposed the inadequacies of our social care system.
Our care homes proved to be totally ill-equipped to deal with Covid-19, with the most deadly consequences. Tens of thousands of people have died in care homes after contracting the virus.
Proper funding is the first step to addressing over a decade of Tory neglect. However, a national insurance tax rise is the wrong priority.
Firstly, we cannot tackle the social care crisis until care is taken out of profit-making hands. Any system which prioritises profits over public need will fail to deliver for the poorest.
A long-term solution to the crisis of social care cannot be paid for off the backs of those who are least able to afford it. Instead, there should be a plan based on fairness, meaning those with the broadest shoulders should carry the heaviest burden.
There is more wealth in our country than at any point in history, but it isn’t distributed fairly.
The fairest and most effective way of paying for social care is through taxing wealth. The labour movement is remarkably united behind this principle. Unite the Union, which has 100,000 members working in the health service, supports it. It’s about time the Labour leadership pressed the argument.
But the problems with our social care system run deeper than just underfunding. The very economic model that dominates our system is failing.
We’ve had 40 years of privatisation. In 1979 local government authorities and the NHS provided 64 per cent of residential and nursing home beds in our country. By 2019, 84 per cent of care home beds were in the private sector.
Privatisation has led to the financialisation of our social care system. Now, many of the leading private social care providers are owned by financial institutions like hedge funds, with complex corporate structures involving multiple holding companies, specifically designed to avoid tax and shift profits abroad.
A report by the Centre for Health and the Public Interest found that around 10 per cent of the care home industry’s £1.5bn income “leaks” and is taken out in the form of rent, profit, directors’ fees and debt repayments.
All the while, the care workers are paid a pittance. Carers are some of the most exploited workers in our country. Research by the TUC has found seven out of 10 care workers earn less than £10 per hour, with 24 per cent of workers employed on zero-hours contracts, rising to 43 per cent when including domiciliary care workers.
Not only is this system grossly unfair, it’s also unstable and inefficient. Between 2014 and 2019 over 400 care home providers collapsed. Some of the biggest companies have gone bust in the last decade. Southern Cross collapsed in 2011 and the company that bought up many of their care homes, Four Seasons Healthcare, went bankrupt in 2019.
The system is no longer about caring for those who need it, it’s become about lining the pockets of faceless shareholders. This is vulture capitalism at its worst.
We must replace the system with one built on very different principles. Our starting point should be the socialist principles of the National Health Service – free at the point of use, available to all who need it and publicly owned.
Rather than the super-rich taking money out of our social care system, it’s time they put more money in. It’s time for a wealth tax. That way we can create a world leading care system.
Jon Trickett MP
This article was first published in the Morning Star