MPs make ‘crucial’ call over national tax rises to solve social care funding crisis

A committee of MPs has issued a “crucially important” call for the government to consider increasing national taxes as a way of solving the adult social care funding crisis.

Two high-profile reports published this week highlighted the continuing funding crisis, one by the Commons communities and local government select committee, and the other by the Institute for Fiscal Studies (IFS).

The select committee report concludes that inadequate funding was having a “serious impact” on both the quality and level of care, and said that a “long-term fix” was “urgently necessary”.

It calls on the government to work with parties across the political spectrum as it prepares its green paper on the long-term funding of social care.

The report says that any discussions should proceed on the basis that “all options are on the table”, including raising money from national taxation – such as income tax, national insurance or inheritance tax – purely to pay for social care. 

Days later, IFS published a report on changes in council-funded social care in England since 2009-10.

The IFS report, funded by the charity the Health Foundation, found that spending by councils on social care per adult resident fell by 11 per cent in real terms between 2009-10 and 2015-16.

But it also found a significant variation in spending between local authorities, with one in 10 spending less than £325 per adult resident, and one in 10 spending more than £445 per adult resident.

About six in seven local authorities reduced adult social care spending over the seven years, with one in 10 cutting spending by more than a quarter, and one council cutting funding by nearly 40 per cent.

Cuts were largest in London boroughs (an average of 18 per cent) and metropolitan districts such as Greater Manchester, Tyneside and Greater Birmingham (16 per cent), while they were lowest in southern shire counties (seven per cent) and southern unitary authorities (five per cent).

Other research has shown that the number of people receiving local authority care between 2009-10 and 2013-14 fell by about a quarter, from 1.7 million to 1.3 million.

Professor Peter Beresford (pictured), co-chair of the national servicer-user and disabled people’s network Shaping Our Lives, said he believed the select committee report’s recommendation to look at national taxation as a possible solution was “crucially important and in my view the only sustainable way forward” and “the first time for a long time” this had been raised.

He said: “The scale of the crisis in social care funding is now reflected in the frequency and profile of major reports about it.”

He added: “The respected IFS’s report reveals a disastrous and unravelling mess.

“But it also paints a more complex picture than is usually offered, with significant differentials in local spend and some councils making much bigger cuts than others, as well as double whammies resulting from welfare cuts.”

Sue Bott, deputy chief executive of Disability Rights UK (DR UK), said: “The cuts to social care outlined in the IFS report and the impact of underfunding of social care outlined in the select committee’s report will come as no surprise to disabled people who are reliant on social care, many of whom are effectively institutionalised in their own homes. 

“Once again we will all say how shocking these figures are, which they truly are, but will anything happen? 

“We are promised yet another green paper, giving us yet another opportunity to say what needs to happen. 

“DR UK will certainly engage in that process, arguing that disabled people’s support needs need to be funded and joined up so that we can enjoy independent living and play our part as full and equal citizens in our communities. 

“But faced with a government that is not listening we need to do much more joining with others, such as on the Independent Living Strategy Group [a network of disabled people’s organisations and their allies, chaired by the disabled peer Baroness (Jane) Campbell], and giving disabled people the tools to challenge the decisions that restrict our lives.”