Health and Social Care Levy Bill

Baroness Bennett of Manor Castle Excerpts

2nd reading & Order of Commitment discharged & 3rd reading
Monday 11th October 2021 Lords Chamber

[Baroness Bennett of Manor Castle (GP)]

My Lords, in following the noble Lord, Lord Naseby, I wish to entirely dissociate myself from anything he said about general practitioners. That was an unacceptable attack on people who have given so much to our society under the extreme pressures of pandemics. The gendered nature of his remarks was particularly disturbing. I do not know if it is something that the House authorities will look at, but I certainly think that they should.

To go back to what I was going to say, it is a great pleasure to take part in this mostly extraordinarily high-quality debate, and its fine level of forensic scrutiny—most notably the tour de force from the noble Lord, Lord Forsyth of Drumlean, who is not currently in his place. I also applaud the contribution of the noble Lord, Lord Sikka, who rightly labelled this as a Johnson tax, with the poorest hit hardest. I will circle back at the end to the reasons why I think that is a particularly accurate label.

We must look at what is happening here in this debate: we have a huge democratic deficit. We in your Lordships’ House have torn this plan to shreds, but we cannot do anything. Such is the state of our antique, dysfunctional political system, Boris Johnson won 44% of the vote in 2019 and now he can do what he likes on anything at all, including taxation. The phrase “no taxation without representation” comes to mind, because the strange thing is that your Lordships’ House is more representative of the country than is the other place. If we had a vote in your Lordships’ House, it would be the Cross-Benchers—the non-party people—who would have the deciding votes.

It is worth thinking about what the words “social care” actual mean. Nobody that I have heard has really defined this or looked in detail at what it means; we tend to talk in the abstract. So I decided to look at Scotland’s definition, where, of course, social care—in a far more democratic political system—is free.

[A noble Lord]

Not entirely.

[Baroness Bennett of Manor Castle (GP)]

It is a lot freer than it is here. What does it cover? Personal hygiene, assistance at mealtimes, immobility problems, medication and general well-being. In Wales—also more democratic—there is a cap on how much can be charged weekly for such provision, similarly defined. Just imagine for a second being in the position of not being able to get or afford such care—to eat, to bathe, to take your medication with confidence you are taking the right pills at the right time. It is really stressful to need that care, and to not be certain that it is available to you is very distressing and, indeed, unconscionable.

In the course of this debate, I also find myself unable to resist challenging a statement made by the noble Lord, Lord Hannan of Kingsclere, that this is taking money from the productive bit of the economy. I challenge the noble Lord’s definition of “productive”. A carer ensuring that a frail elderly person is able to feed themselves; an assistant enabling a profoundly disabled young person to live a full life—that surely is the definition of a productive use of the resources of our society. We come back to a really fundamental question: is the economy there to serve us, or are we slaves to the economy? This is where I disagree with the noble Baroness, Lady Altmann—not currently in her place—who suggested that social care should not be a political issue. This is absolutely political; it is about the way people, particularly our most vulnerable, are able to live in society.

I want to address one crucial issue before I get to three points about the structure of the Bill and the way it works. Here I echo the words of the noble Baroness, Lady Brinton, who asked the Minister to disavow the claim from the Health Secretary that social care should be provided by families. I very much hope the Minister will directly address this point and will disavow that comment, because it suggests that the Government indeed regard this, as many have suggested from different angles, as a temporary measure; that they plan for the state to eventually step back from any kind of provision for social care at all.

We heard from the right reverend Prelate that he takes a share, entirely commendably, of the care for his 93 year-old father. But how many families are in a situation to do that? The pension age is rising; many people who might have provided care for elderly relatives are now in paid employment—they have to be to meet their costs. It is a standard assumption that both members of a couple, where people are in couples, will work. Also, sadly, we are seeing the level of disability among middle-aged people rising. There is also the question of space: 1.5 million people who live in social housing are already in overcrowded conditions, which means circumstances such as children sleeping in the living room. Where are you going to put an elderly relative you are caring for—in the bathroom? I very much hope that in addressing this issue, the Minister will answer the questions at greater length than when he introduced the Bill.

We have heard some noble Lords refer to the idea of funding social care through individuals paying insurance, although most have accepted that is unviable. However, we should regard being a member of what we would hope is a decent, caring society as an insurance against hard times, illness and disability. That is why social care should be available without challenge at the point of use to all who need it.

I will address three specific points about the structure of this proposed Johnson tax: who is paying, how the money will be raised and where it is going. The noble Lord, Lord Eatwell, referred to how costs fall particularly on low-paid workers. He made some further interesting and disturbing points about the way the Government’s illustrative analysis seems to put the idea of paying for healthcare linked directly to payment.

I want to pick up a couple of groups to see what that actually means. I credit the Liberal Democrats in the other place for uncovering the fact that NHS and social care workers will be paying 12% of the £7.4 billion expected to be raised from employees through the tax—£900 million. That does not include self-employed healthcare workers and social care workers, so the real figure is even higher—call it £1 billion. These are often low-paid workers, carers and nurses, far too many of whom we regularly hear are dependent on food banks to feed themselves. They are having money taken from them so that possibly a little more money goes into the system. I will quote an unusual source for me, Fraser Nelson in the Spectator:

“How can you justify increasing taxes on the working poor to safeguard the assets of the stonkingly rich?”


What we are seeing—I think the public is often not well aware of this, because for many it is an academic point which will never come into view—is the fact that the national insurance employee contribution falls from currently 12% of income to 2% of earnings over £50,270 a year, so that high-earners pay a lower proportion of their earnings in national insurance contributions than low earners.

Of course, national insurance contributions also kick in around £9,500, which means that even some people too poor to pay income tax are paying into the system. When we think about our broadly-speaking young people—the graduates paying back student loans—they will be taxed at 50% on any increase in salary above £27,288.

So, those are the people who are paying. How is it being arranged? I refer back to the excellent speech by the noble Lord, Lord Forsyth of Drumlean, who spoke about the need to combine income tax and national insurance and the missed opportunity for a simpler, fairer, flatter tax system. The noble Lord, Lord Naseby, was looking for an alternative solution. I can point him to the Green Party manifesto of 2019, which goes even further than the noble Lord, Lord Forsyth. It merges employee national insurance, capital gains tax, inheritance tax, dividend tax and income tax into a single consolidated income tax. All income is treated the same way for tax purposes. This ends the injustice of people who work for their income being taxed more lightly than those whose income is derived from wealth, frequently arrived at by accident of birth or blind luck. I also note that our manifesto provides free social care to the over-65s.

Finally, I get to the point about where the money is going, and this picks up points made by the noble Lord, Lord Sikka. A large amount of this money is going into a privatised, financialised sector—large chains of care homes with hedge fund owners taking returns of 12% or more a year out of the provision of care for our most vulnerable citizens. I very much enjoyed and commend the contribution of the noble Lord, Lord Griffiths of Burry Port, who talked about the commendable work of MHA and gave us an insight into just how difficult that work has been, particularly in the last couple of years. We also heard about the excellent work MHA is doing through music therapy. All the funds it gets go towards providing care. Think about what would happen if you scooped out 12% or more in financial returns and then still tried to meet the basic needs of residents—that is certainly all you would be able to do.

Of course, that is academic because, as many noble Lords have said, while this is talked about as being for social care, the money, for the next foreseeable time, will go into the NHS. With one more executive power grab, from 2025 the Chancellor will decide what happens then.

It is often suggested that there should be a “truth in advertising” rule for government policy. If we were to see that, we might see a total gridlock of government—one to rival the chaos in our supply chains—as opposed to the tangle of unpublished strategies, undeliverable targets and fantasy announcements that we have now. Were trading standards and the Advertising Standards Authority asked to cover the announcements of government, I think their websites would do down in seconds.

This is billed as a health and social care levy; it is clearly nothing of the sort. It does nothing to fix the enormous financial and structural issues in our care system. It leaves underpaid, overstressed workers seeking to care for underserved, neglected patients while private profits are scooped out of the system. It does not even do more than apply sticking plasters across some of the gaping gaps in our NHS.

I conclude by referring back to that term, “Johnson tax”. It is misleading in its claims, it is fragile in its structure and it does not create any kind of solid framework for the future. I cannot help thinking of the London garden bridge, the Irish Sea bridge, the “Boris buses” and the so-called Emirates Air Line. It is misbegotten, unreliable and fundamentally unsound.