On 25 July Patricia Hollis wrote in a letter from the House of Lords to the Guardian that:- “We can afford Social Care, if we choose to. It doesn’t have to be a “burden” on people of working age. Three-quarters of tax relief benefits the better off. It is hugely regressive. Scrapping pension higher-rate  tax relief for employers and employees would save £15 billion; paying for pensions out of taxed income, but drawing those pensions tax free, as with ISAs , would save around £8 bn. Removing the partial National Insurance cap on higher-rate employees would save a further £11 bn.
Yes, this would mean that higher-rate earners would have a lower, though still generous pension in retirement ; but if we ringfenced those savings for social care , we would be redistributing within the pensioner population, from younger,healthier,wealthier, mainly male pensioners to older, poorer,more frail and mainly female pensioners in need of care; and not be expecting our children and grandchildren to pay for us.” 
Baroness Hollis shows how we could save £34 billion,if well-off pensioners made a larger contribution. Services to the Elderly could be increased. Hundreds of thousands of well paid , secure jobs with training would be provided for younger people, (who would thus benefit directly).
Some examples of how to use under half the yield which would be found from these changes in the tax system:-
1) £5 billion pa could be used to create a massive increase in Adult Social Care for Elderly and Disabled. 
This is about double the amount proposed in the Dilnot Report. Their modest proposal was only enough to continue with current inadequate level of services (but the Coalition Government has not committed itself to any financial support, putting this off until after the general election).
Patients could be cared for and treated at home and in day centres in the care of their GPs and Primary Care teams and Social Services.Residential Homes Care would be much improved, which would also result in less admissions to hospital and earlier discharges back to residential care. These more generous provisions would result in reduced admissions to hospitals and faster discharges,yielding many savings to NHS.
EMPLOYMENT:-Many staff in social care are part-time. If average cost of employing a member of staff is £20k pa, £5bn annually would provide jobs for 250 thousand full-time and part-time jobs (not employed  on “zero-hour” contracts.). Many of these jobs are highly suitable for young men who might not have succeeded in formal education, but with training show great skill. In  my experience older people welcome men, as long as they are well trained, supervised, and reliable.  Coalition plans for spending after the general election are clear. They will cut grants to local authorities further. This means the current crisis in Adult Social Care will get worse, as population grows.
2) £2bn could be paid as interest on loans to local councils and Housing Associations to build specially adapted,energy-saving “sheltered” flats for sale or to let to elderly and disabled. This interest would allow building over several years of approximately £40 billion worth of adapted housing, ie 600 thousand flats @£65 thousand per flat. 
When older people sell or leave their currently rented accommodation, the houses left would be available to younger families. These flats should be built on “brownfield sites” in existing communities in centre of towns and suburbs, replacing old houses or sometimes shops. Currently many elderly live in houses which are costly to maintain ,in poor repair, and difficult to heat. They would be obtainable far nearer to relatives than where many old people live a present. A programme of building £6billion worth of houses per year would obviously result in thousands of added jobs in construction industries (120k full-time jobs @50k per job)
3) If £8 billion pa were added to the NHS budget, this would mainly benefit the elderly.At present the need for savings of £30 billion from the NHS budget is likely to damage NHS services to the elderly , which the Chancellor does NOT intend to find after the general election . He has stated this quite clearly.  Those who had contributed to the suggested savings, ie the well-off, are usually more skilled at visiting doctors when they need NHS services. So they would benefit more than average.
ECONOMIC FACTORS:-
Spending £15 billion pa,as above, from the possible suggested savings of £34 billion would result in large increases in numbers employed (at least 350 thousand without counting jobs saved in NHS), increased tax receipts and lower benefit payments.
THIS TYPE OF STRATEGY is vital if the NHS is to continue (I do not suggest no changes in current organisations.) Adding to the housing stock as indicated would NOT increase price of houses, but would increase the supply.
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One Comment

  1. Robbing Peter to pay Paul is the classic economic strategy that has hamstrung progress for an eternity, when are people going to realise that it is the financial system that has bankrupted the economy and not the public sector.

    Instead of allowing private Banks to print their own money for themselves that money could be used free to provide all the public demands we need, and sustain an economy which the Financial sector can’t.

    Here is what is actually happening in the economy:

    http://www.youtube.com/watch?v=JQuHSQXxsjM

    Nationalise the Banks and take control of the economy instead of being a prisoner of it.

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