MPs at Westminster have approved Boris Johnson's controversial £12 billion (€14 million) a year tax increase to tackle National Health Service (NHS) waiting lists and fund social care. A Conservative backbench revolt was blunted as many rebels chose to abstain rather than vote against the measure, which was approved by 319 votes to 248.
The prime minister has acknowledged that the increase in national insurance contributions is in breach of the 2019 Conservative manifesto. But he claimed that it would save people from the “catastrophic costs” of social care by setting limits on how much of their personal wealth they would have to spend on their care.
“The plan deals – after decades – with catastrophic costs faced by millions of people, the risks that they face, the threat they could face, the loss of their homes, their possessions, their ability to pass on anything to their children,” he told prime minister’s questions.
The plan promises that nobody will have to pay more than £86,000 for social care over their lifetime (although it does not cover residential costs) and the Conservatives have suggested that this will mean nobody having to sell their home to pay for care. But Labour leader Keir Starmer said the plan would see poorer people of working age subsidising wealthy homeowners and protecting the value of properties they pass on to their heirs.
“Under his plan, a landlord renting out dozens of properties won’t pay a penny more, while their tenants in work will face tax rises of hundreds of pounds a year. A care worker earning the minimum wage doesn’t get a pay rise under this plan but does get a tax rise. In what world is that fair?” he said.
Under the plan, most of the extra money will initially go towards reducing NHS waiting lists but more should be diverted towards social care after three years. Jake Berry, a former Conservative minister who heads the Northern Research Group of MPs from the north of England, predicted that the levy would become a permanent NHS tax.
“If it’s an NHS tax which will be hypothecated and listed on your payslip then call it that, don’t call it a health and social care tax because it’s to fund the NHS and when the time comes to move the money from the NHS over to health and social care, what government of any political hue is going to cut 12 billion from the NHS budget?” he said.
“So if you create an NHS tax, you have an NHS tax forever, it will never go down, it can only go up. No party is ever going to stand at an election and say I’ve got a good idea, vote for me, I’ll cut the NHS tax.”
Labour's shadow chancellor of the exchequer Rachel Reeves said the plan represented a broken promise, it was unfair and it was a tax on jobs.
“The sad truth at the heart of this so-called health and social care levy is that it will not deliver on social care for at least three years from now, and even then it is uncertain when the government might allow some money to trickle down,” she said.
“Many of those with a house worth £186,000 – that includes many constituents of Conservative members – will still have to sell their home to fund £86,000, within the cap. That is before the costs of living in a care home.”