Wales tax rises considered to pay for growing care costs

Tax rises to cover the cost of caring for elderly and disabled people are being considered by the Welsh Government.

The money raised could be spent on abolishing care fees or on a pay rise for care workers.

A consultation on possible reforms to social care is due to start this summer.

Health Minister Vaughan Gething is set to call for “honesty” and a “grown-up debate” about increasing care costs.

But the idea of raising income tax is likely to prove contentious in the run-up to the Welsh elections next year.

Social care is under pressure across the UK from a squeeze on funding, an ageing population and high staff turnover.

The state spends about £1.2bn on adult social care every year in Wales.

But in a statement to AMs on Tuesday Mr Gething will say the cost is predicted to grow between £30m and £300m by 2023.

If the government wants “to seriously improve the quality and the reach of care, then it will require more funding”, he told BBC Wales.

“If you want to unpick all that and say ‘actually we don’t want to raise taxes’, you’ve then got to be prepared to identify where you’ll take money from.”

Raising money from elsewhere would involve targeting other services for cuts “and after a decade of austerity I’m not sure that’s really a viable prospect, but if other people want to make that argument then of course they can do”.

How many more of us are living longer?

If you’re in your mid-30s and living in Wales now, you could be one of more than 220,600 predicted to be living beyond their mid-80s in Wales in 50 years’ time.

That’s nearly as much as today’s combined populations of Newport, Barry and Pontypridd.

Currently, the population of over-85s stands at just under 85,300.

The numbers of people aged over 70 and in the oldest age group are growing steadily – and as a proportion of the overall population.

Health economists have predicted too that this will translate into the cost of looking after people as they live longer.

The Health Foundation says pressures for adult social care are projected to rise faster than for the NHS, by an average of 4.1% a year.

Fully funding these pressures in Wales would require an extra £1bn by 2030-31, it found.

A report by another economist, commissioned by the Welsh Government, suggested an income tax increase of between 1% and 3% could be used to fund social care – but would vary depending on age and income.

What will happen now?

Changes will not happen before next year’s Welsh assembly elections.

Possible options fall into three categories: expanding care, reducing fees and paying workers more.

Mr Gething said: “We would have to find more resource to do any of these and that’s the honesty we need in the national conversation.

“In all of these you can’t get away from not just what we want, but also how much are we prepared to pay and by what mechanism.”

Income tax rises, creating a new social care levy and changing the fees people pay were all “on the table”, he said.

“I think that grown-up debate should lead us to somewhere where we understand exactly that you can’t have something for nothing.

“If you want dignity, if you want quality, in the care that’s provided to people of all ages you have to find a way to fund that.”

Janet Finch-Saunders, the Welsh Conservatives’ spokeswoman for social care, said she looked forward to an “overdue statement on this issue”.

“We need to ensure that we are not looking to pour more money into a broken or inefficient system,” she added.

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Where volunteers step in

A volunteer-run project has been holding a weekly tea dance in Bridges Community Centre in Monmouth for the last 16 years.

There are other activities and befriending services, which have some health board and council funding but it is not long term.

“Everyone’s having a good time and feeling good, but we’re very worried that we set this up and we don’t know what’s going to happen in future,” said Miranda Thomason, project manager.

“We know there’s more demand and less resource, we’re being asked to do more – statutory services are saying ‘please can you help these people with more complex need’. As more people know about it, more people will engage with it.”

How is social care paid for at the moment?

Unlike the NHS, social care provided by local councils is not always free at the point of need.

Fees for home visits by carers are capped at £90 a week. Care home residents pay for their care unless they have assets of less than £50,000.

The system is less generous in England and Northern Ireland, but in Scotland personal care is free.

Devolved governments in Edinburgh abolished charges for things like helping people get dressed and making meals, without having to put up taxes.

Mr Gething said Scotland had a “more generous” budget deal from Westminster.

Previous governments had “kicked the can down the road”, he said, adding that Wales could not continue to wait for UK government proposals on social care.

A Green Paper on reforming care was promised under Theresa May in 2017, but still has not been published.

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