Tax rise for 25mto pay for Britain’s social care bill: Boris Johnson ‘will break manifesto pledge and raise National Insurance by 1% or more to pay for £80k cap on care costs – amid Cabinet split over how big the increase will be’
- 25 million Brits will be hit with a tax rise to pay for expansive social care reform
- Prime Minister set to announce move to increase National Insurance next week
- Downing Street and Chancellor Rishi Sunak understood to still be ways apart in their support over the size of the National Insurance hike
Boris Johnson will hit tens of millions of people with a tax rise to pay for his long-awaited reform of social care.
The Prime Minister is expected to announce as early as next week that National Insurance must be increased to tackle the crisis in elderly care – breaking a pledge in his election manifesto.
But he will say that in return, the Government will place a limit on the amount individuals have to pay for support in old age and protect them from having to sell family homes to settle the bills.
The Daily Telegraph reported last night that the cap could be far higher than previously thought, in order to save the Treasury billions.
Boris Johnson is expected to announce as early as next week that National Insurance must be increased to tackle the crisis in elderly care – breaking a pledge in his election manifesto
Downing Street and Chancellor Rishi Sunak (left) remain at loggerheads over how big the hike in National Insurance should be
It could be between £60,000 and £80,000, meaning pensioners will still face huge outlays before the state steps in to cover their costs.
In addition, it was claimed that Downing Street and Chancellor Rishi Sunak remain at loggerheads over how big the hike in National Insurance – paid by about 26 million people in work – should be.
No 10 is said to favour a 1 per cent rise, adding about £500 to the annual NI levy on a high earner, but the Treasury wants to push it to 1.25 per cent, taking £600 more from someone on £60,000.
The Times reported that Health Secretary Sajid Javid was pushing for a 2 per cent rise, saying that a 1 per cent increase would raise only £10 billion, but far more was needed.
Tens of millions of people are set to be hit by a new tax rise to pay for the Prime Minister’s long-awaited social care reforms [File photo]
Some Cabinet ministers are believed to oppose any rise, on the grounds that young workers should not have to foot the bill for the care of older, often wealthier, generations.
NHS leaders say hospitals also need huge sums to deal with a backlog of delayed operations.
The announcement of the social care plan is pencilled in for Tuesday but the details have yet to be signed off and could still be changed.
It will fulfil Mr Johnson’s pledge when he took power two years ago to ‘fix the crisis in social care once and for all’.
However, it is also a political gamble as the Conservative manifesto at the 2019 election vowed: ‘We promise not to raise the rates of income tax, National Insurance or VAT.’
A Government spokesman said last night: ‘We are committed to bringing forward a long-term plan to reform the social care system and we will set out proposals this year.’
Health Secretary Sajid Javid has reportedly been pushing for a 2 per cent rise – more than double other estimations – in National Insurance payments.
Mr Javid is ‘concerned’ that current projections of £10billion being raised by a 1 per cent increase would not be adequate, reports The Times.
His comments are understood to be part of plans to back the NHS with ‘billions more in funding’, amid a growing chasm between Cabinet members on how best to tackle the nation’s social care crisis.