Social care funding

Social care funding

Jenny Morris Disability policy expert

Today in Parliament, MPs are debating the Health and Care Bill. The Bill includes plans to exclude means-tested council support payments from the proposed £86,000 lifetime cap on care costs. This policy, if enacted, would be hugely unfair for disabled people of working age.


For years, the ‘problem’ of social care has been framed as the ‘catastrophic care costs’ faced by some older people who, if they need to enter residential or nursing care, have to sell their homes to pay for it, thus reducing their children’s inheritance. But the catastrophe for many working-age disabled people takes the form of years of poverty and a denial of opportunities. Excluding council support payments from the cap would embed this injustice as an integral part of the new funding regime for adult social care.

The new regime, which will be introduced from October 2023, will place a ‘cap’ of £86,000 on what someone will have to pay towards their care. It is being funded by increasing national insurance contributions paid by people of working age, which disproportionately affects those on low incomes. This is unjust in itself, but the government is now attempting to introduce an amendment that would change the way the cap works, so that wealthier people benefit more.

Unlike health care, social care is means-tested, and in recent years local authorities have been increasing the amount that people have to pay towards the cost of necessary care. For those who rely solely on benefits, anything above a Minimum Income Guarantee has to be used to pay for their support.

Initially, the proposed new funding regime assumed that the amount that local authorities contribute towards someone’s care would count towards the cap of £86,000. The proposed amendment changes this, so that only the amount that someone contributes themselves would go towards the cap.

A real-life example provided by Inclusion London illustrates the unfairness of this for those who enter adulthood already disabled:

“A disabled person like Nadia, without assets and minimal chances to enter the labour market and accumulate wealth, must pay for care from means-tested benefits. The Government sets minimum amounts of money people should be left with. These vary depending on age, personal circumstances, and the impairment's severity, starting from £72.40 per week. Young adults such as Nadia with high support needs are left with £151.45 per week to live on. With her contribution of £68 per week, Nadia and people in a comparable situation will have to live on as little as £151 per week for 24 years. Only after that would they qualify for free care and be able to keep all of their disability benefits.”

This situation would also apply to anyone who becomes disabled during adulthood. Imagine that you are a 29-year-old, progressing well in your career, still living with your parents but slowly building up savings in the hope that you’ll be able to afford your own home. One day, out of the blue, you are in a car accident which leaves you paralysed. When you come out of hospital you find that you can no longer do your job, so your only income is from disability benefits, which are diminished by the contribution you have to make towards your care costs. You will be now be condemned to years and years of living in poverty. And your chances of ever getting a home of your own have disappeared.

The 2011 Dilnot Commission recommended that “all those who enter adulthood with a care and support need should be eligible for free state support immediately rather than being subjected to a means test”. Andrew Dilnot repeated this recommendation in the context of the current legislation.

Disability Rights UK CEO Kamran Mallick has said: "There is no doubt that social care needs urgent reform. But it is morally unfair to ask disabled people of working age to pay for it."

It isn’t only people of working age who are getting a poor deal from this new system. People of any age with fewer assets are more likely to lose almost all of them than those with more assets.

As Torsten Bell, of the Resolution Foundation said: “Here’s a simple way to think about the problem the government has created: if you own a £1m house in the home counties, over 90% of your assets are protected. If you’ve got a terraced house in Hartlepool (worth £70k) you can lose almost everything”.

Baroness Jane Campbell said in a recent House of Lords debate that “protecting accumulated wealth has become the overriding goal of reform”.

This is an edited version of a blog post that was originally published on 21 February 2022

Jenny Morris OBE holds a PhD in Social Policy, on the origins of minimum wage legislation. She taught housing policy and sociology and then worked for 20 years as a consultant/researcher/policy analyst on disability policy. This included working with the Prime Minister’s Strategy Unit to produce Improving the Life Chances of Disabled People, a 25 year strategy launched in 2005. She then led the development of the Labour government’s 2008 Independent Living Strategy. She retired from full-time work in 2010 and was until recently Visiting Professor of Social Policy at the University of Suffolk.

Jenny was specialist advisor to various Select Committees concerned with disability issues - including to the Joint Committee on Human Rights’ Inquiry into Independent Living - and also contributed to, or wrote, good practice guidance on, for example, working with parents with learning disabilities, and child protection work with disabled children. Her research interests encompassed a wide range of issues concerning disabled adults and children. She was also commissioned by a number of local authorities to train social workers on social care assessments, and evaluating services.