People over 40 face higher taxes to fund their care when they're older

Britons over the age of 40 could soon be asked to pay more tax to help pay for the cost of their care in later life, as part of radical new plans being considered by ministers, according to reports.

The prime minister has been under pressure to fix Britain’s social care crisis ‘once and for all’, after pledging to do so more than a year ago when he entered office. Officials have said there is a ‘renewed urgency’ to come up with a solution to cover the cost of care, which can exceed £1,000 per week for one person.

According to sources, over-40s paying towards the cost of a reformed system of care is the most popular plan being analysed by the Department of Health and Social Care (DHSC).

The plan would see all over the age of 40 paying more in tax or national insurance, according to The Guardian, or through a private scheme in which they are compelled to insure themselves against care costs.

Funds raised would then go towards helping the elderly population who need to cover care home costs, or those who need assistance in the home.

Health Secretary Matt Hancock is said to be backing the plan, which is modelled on similar schemes in Japan and Germany, in a bid to overhaul the entire system.

In Japan, everyone starts contributing to their own social care when they reach 40, while in Germany people pay 1.5% of their salary into a ring-fenced fund as soon as they start working which is matched by employers.

However, ministers are said to be divided over the plan with the Treasury understood to be casting doubt over the idea amid concerns it could anger a generation who are still paying off student loans and mortgages.

Currently in the UK, thousands of elderly people are backed into a corner every year and forced to sell their home to cover the cost of care if they are deemed too wealthy to be eligible for council provided care.

Often the payments fall to their family members to cover, which on average can cost £937 per week for nursing care, or £655 for residential care in England, according to Which?.

Other private companies list the price of live-in care costing at least £1,000 per week for one adult, and more than £1,400 for respite care.

The proposed plan comes as the Local Government Association (LGA), which represents charities, councils in England and more than 30 health organisations, called for the government to ‘reset’ the social care system.

Chairman James Jamieson said: ‘For too long we have been promised a plan to fix the social care crisis but people who use and work in these vital services are still waiting. The Covid-19 crisis has proved we need a complete reset, not a restart, when it comes to the future of social care.’

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