Council tax hike of 10% needed for social care to ‘stand still’, analysis warns

·3-min read
 (REUTERS)
(REUTERS)

A council tax hike of 10 per cent would needed without an urgent government cash injection, just to allow social care to “stand still”, according to a new analysis.

In a stark warning to Rishi Sunak ahead of the autumn spending review in a fortnight, Age UK said the chancellor’s decisions will “determine whether social care services continue to wither and die”.

Money the government is planning to raise from a national insurance rise will mainly go to the NHS over the next three years, with the charity adding this will leave social care “desperately short of the funds required”.

At the Conservative Party conference, Mr Sunak did not rule further increase in council tax bills in order to pay for social care — an issue Boris Johnson has promised to “fix”.

Age UK, which is urging central government to provide the funds, agreed with the recent view of the Health and Social Care Select Committee, suggesting annual funding for social care must increase by £3.9 billion by 2023-24.

According to the charity’s own analysis, if Mr Sunak does attempt to fill the gaps by allowing authorities to increase bills, council tax would need to be hiked by 10 per cent in the next year — to raise £3.3 billion.

The organisation also warns that the amount of cash raised would be “highly unequal” across the country, intensifying the “postcode lottery that already affects social care”.

Caroline Abrahams, the charity director of Age UK, said: “For the sake of millions of older and disabled people, social care needs a big injection of extra funding now and over the next few years — but it should come from central government, not by massively hiking council tax.

“Our new analysis shows the even if you make local people pay a whopping 10 per cent in council tax — on top of the 19 per cent average rise we’ve seen in recent years — it still won’t give social care all the money it needs.”

She added: “Social care provision is too important to too many people for its fate to depend on local politics and local tax bases.”

A previous analysis by the Local Government Association (LGA) has warned that council tax may have to rise to plug the black hole in the care system, claiming that authorities face extra cost pressures of almost £8 billion by 2024/5 — “just to keep vital local services running at today’s levels”.

And last week, the Institute for Government, a respected think-tank, said the sector would need billions of pounds more and substantial council tax rises.

Ms Abrahams added: “The stakes could not be higher: his [Mr Sunak’s] decisions will determine whether social care services continue to wither and die, just about stand still or, more optimistically, get stronger over the next three years.

“It was the prime minister who made the promise to give older people dignity in later life through his social care reforms — a fantastic goal — but it’s the chancellor now, above all, who will determine whether we make progress towards it, or not.”

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