Burnham says he won’t “flinch” on social care

As Baroness Casey takes on the question of who should pay for care directly to the public, which way will the Burnham government head on social care, and how long will it take?

Before entering power, the Labour manifesto included key elements of a far-reaching Fabian/Unison proposal for a national care service, including national standards and a fair pay agreement. But on the question of who provides the care, Labour backed away from a publicly driven model, favouring only making current providers behave responsibly.

And after the election, to calls of “cop out”, they chose to shelve a proposed cap on an individual’s care costs in favour of another lengthy review – led by Baroness Casey – there have been 25 similar initiatives since 1997.

The level of political vacillation on the issue is startling. The legislation needed to implement the cap on the care costs borne by the individual was passed in the Care Act 2014. Cameron postponed the cap on the grounds of cost. Boris Johnson agreed to a higher cap but didn’t implement it, and now Labour have created a multi-year delay while they search for a consensus.

Burnham: where are we now?

Baroness Louise Casey announced that her commission on adult social care in England will begin testing public opinion. She will ask who should receive social care, what families should be asked to do, what the state provides, and what the individual should pay.

Although her final report is expected by 2028, the Burnham team has indicated that his first impact will be to call on the Casey Review to submit meaningful proposals by the end of 2026, bringing the timetable forward by two years.

Baroness Casey described a “patched together” system that too often creates “agony and uncertainty” for people at the most vulnerable points in their lives.

“None have fixed the foundations,” she said. “Because reform has either tried to improve bits of the system without addressing the whole. Or it has reached for bigger reform without securing public consent for the hard choices it involves.”

Giving evidence to the Health and Social Care Committee in June, she said her interim report, due later this year, will suggest some “quite big” changes to the system.

Burnham: how to pay for it?

The PM has already looked over these questions when he led the Brown government’s original National Care Service proposals in 2009–10. Modelled on the NHS  “universal and free at the point of use”, they did not say how it would be paid for, and here lies the jeopardy.

Although Burnham may want to be bold, he will not want a repeat of Theresa May’s experience, when her attempt to limit care costs through changes to inheritance tax became known as a  “death tax”, and badly undermined her 2017 election campaign. And indeed, according to a recent Telegraph article, Burnham is reworking a policy to finance the care of older people by replacing inheritance tax with a universal flat-rate care levy on all estates.

This would drag a wider cohort of middle-income families into the tax net, thereby increasing the Treasury’s net income from this source by around £5-10bn a year, but the necessary detail is scant here.

The overall cost of the social care project, if the Burnham government goes down a route towards an NHS-style free-at-the-point-of-use provision, could be in the region of 15bn a year and rising. So there is still a sizable funding gap.

Individual versus the state.

This points to the tension between what individuals may have to pick up and what the state is willing to fund from taxes.

And this is the difference between Burnham’s current proposal and May’s 2017 proposal.

Burnham’s would charge all estates, creating a public pot of funding – so that the risk of needing care is shared across the population.

May’s system charged people who happened to need care, protecting £100,000 of an individual’s assets from home care bills, but removed the protection for the cost of care at home. All care bills could therefore mount and be recouped from the estate after death.

The Telegraph also claimed to have the inside track on other ways to fund the proposals, including raising the top rate of income tax to 50p, lowering thresholds for a mansion tax and devolving tax-raising powers to local councils.

If Burnham follows the principle that care should be available free when needed, this will wipe away the Dilnot proposals, which were an attempt to share the cost of care between individuals and the state. However, the politics and the sizable costs mean that a compromise or a staged process is likely.

Halfway house to a National Care Service?

One way Burnham could step back from the cost commitment of social care, free at the point of use for the whole population, is to introduce eligibility criteria based on clinical need, type of care, or the circumstances of need. This risks adding to a system that is already confusing and inequitous, but Scotland offers an example of how this can be done.

Personal care is free in Scotland,  doesn’t cover all social care costs, and, like England, would only provide set funding for nursing care in care homes, but a King’s Fund estimate priced Scottish-style free personal care in England at £6bn in 2026/27, rising to about £7bn by 2035/36.

Scotland: if a needs assessment shows you require personal care, it’s delivered without an income or assets test. Personal care includes help with washing, dressing, eating, continence, and mobility, but it doesn’t cover general domestic care help, accommodation costs, or residential care fees.

If Burnham wants to hold onto the idea a national care service as the end goal, then the Fabian Society–UNISON report has already laid down a possible route. It proposed creating the institutions and national standards of a National Care Service first, while improving affordability in a staged way using a cap on care costs, more generous means testing, and free care for some groups. That would mean Dilnot-style protections against sky-high care costs as a temporary arrangement, while care entitlements and public provision were gradually developed, on the way to a centrally funded universal system.

Workforce and supply side issues

The care system is nothing without staff, and the current structure has done little for decades to encourage good rates of pay, training opportunities and decent working conditions. The result is a persistent crisis in recruitment and retention.

Announced a few days ago, the government has created a New negotiating body to be set up as part of the first-ever adult social care fair pay agreement, representing millions of care workers.

“Millions of care workers in England will be represented in upcoming negotiations on pay and working conditions through a new body established to deliver the first ever fair pay agreement for adult social care. “

Burnham could consider accelerating the timetable and looking at areas of minimum pay or paid travel time, but the difficulty is that any improvement in the conditions would have to come with funding attached and would affect a whole raft of small providers, many of whom are already struggling.

A target for the first budget could be to improve ring-fenced funding for councils and providers to enable these fair pay arrangements to be implemented.

At present, the sector relies on a patchwork of relationships between councils and independent providers. These can’t be replaced overnight, and clearly there are dangers in disrupting the supply, as parts of the market are already fragile.

Again, Burnham could well be attracted towards the Fabian-UNISON model, which offers a way to gradual change. Helping providers with long-term contracts but also introducing national pay and quality standards, bringing independent organisations into a national care service as licensed public service partners. In parallel, councils could begin investing in their own capacity through a national investment fund to launch non-profit services.

The private sector – will it make reform difficult?

An issue that the numerous commissions and committees have not addressed closely to date is the role of private companies in the adult social care market. Privatisation began in the 1980s and there is now little state-owned provision. Integrating a free, state-owned NHS with a social care system dominated by for-profit companies – many of the largest owned overseas – could prove a difficult hurdle in any reform process.

Local authorities are paying vast sums to private companies that are not necessarily providing an adequate service or paying their workforce adequately. Back in 2016, the Centre for Health and the Public Interest (CHPI) reported that “both the quality of care in adult social care and the terms and conditions of the workforce have declined over the past two decades as a result of privatisation.”

An investigation by The Guardian in 2023 found that almost half a billion pounds had been spent buying beds in the worst care homes in England over the previous four years, driving profits for private investors while residents suffered unsafe treatment.

To make matters worse, a few large operators make substantial profits that are funnelled to private equity investors overseas, while others are in difficult financial positions and struggling to remain viable. The result is a highly unstable market, where borrowing is high, staff pay is low and tight cost controls are in place. For a detailed look at private equity, see our dedicated page here

The ultimate benefit is clearly a more integrated system that is more humane, linked to need and reduces the chance of extra pressure on the NHS, both in terms of emergencies and also reducing the delays from discharge from hospital, which currently use tens of thousands of bed days a month.