Can I ask you a favour? When you’ve finished reading this column, I would like you to pass it on. I am hoping that if it passes through enough hands it might one day, by happenstance, reach a member of one of the world’s most important secret committees. For this article needs to be considered by the conclave that gathers daily to label issues and people as right-wing or left-wing.
The committee’s decisions are sometimes hard to fathom. It first ruled that being against the European Union was left-wing, then changed its mind and decided it was right-wing. It has determined that religious fundamentalists are right-wing, but oddly also that people in the West who want to fight religious fundamentalists are right-wing — unless the religious fundamentalists are American, in which case opposing them is left-wing.
It is right-wing to want to preserve most old things, but left-wing to want to preserve old coal mines. Genghis Khan, for some reason, has been designated right-wing by the committee, while Fidel Castro’s discrimination against gays does not prevent him being allocated to the list of left-wing people, along with Marlon Brando and John Prescott.
Anyway, you get the idea. The committee isn’t just secret, it is also idiosyncratic. There’s no knowing what it will do next. And I am very worried that it will get its decision about the Dilnot report on the costs of social care all wrong.
I will start at the beginning, in case you missed it. On Monday, the distinguished economist Andrew Dilnot published the results of his consideration of the best way to fund care for people in old age, an independent examination that he was asked by the Government to carry out. And a very good piece of work it is, too.
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Mr Dilnot’s central concern is that the costs of long-term care in old age are unpredictable and potentially very large. As a result, it is almost impossible to do what most people do when they face a risk of catastrophic loss. It is almost impossible to insure yourself. Should you be unlucky enough to be one of the 10 per cent of pensioners who will incur costs of more than £100,000, you are basically on your own.
So, here’s Mr Dilnot’s solution. The State will insure you. Or, put a little less bluntly, we are all going to pool the risk. You will be liable for the first £35,000 of care, with a bit more on top for “hotel” charges. In the case of most people, their costs won’t go above this cap anyway. But should you be in the minority and facing really big costs, a new state insurance scheme will pay up. And the really clever bit? Capping costs in that way means that private insurers will be willing to enter the market to cover the first £35,000.
The committee on left-wing and right-wing labels will have its own copy of the report, of course, and will be mulling its decision. But before it makes its ruling I want to make sure it has understood the nature of the proposal being made. A fair amount rides on it.
The Dilnot report appears to be about looking after vulnerable and frail old people, making sure they retain their dignity in old age. It is all about caring and sharing. A market failure is being corrected with the provision of a new state entitlement. Yes, there will be new taxes (it isn’t entirely clear how much. There’s talk of two or three billion pounds a year, but this is just a guess). But this is about the strength of our community, so what the hell.
So, it’s a left-wing proposal, isn’t it? You know, the sort that the Liberal Democrats will be promoting inside the coalition as the Tories resist. And Labour will be talking about the squeezed middle again, as it adds the report to its list of promises. This is about social justice and the Government needs to get on with it. Can’t find the money? That doesn’t matter. It should commit itself to Dilnot in principle and get round to finding the money for it later.
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But I think this misunderstands the Dilnot report. There’s a bit of tidying up of the system, but essentially what is being proposed isn’t about caring for vulnerable people. It’s about insuring the inheritance of their children. In other words, it’s not a left-wing proposal, it’s a version of George Osborne’s inheritance tax cut.
What is being suggested is that the State should protect the assets of quite wealthy people from the possibility that they will be used up to pay for their care. The main consequence of these assets being used up is that they would not be available for their relatives to inherit.
I am not pointing this out because I am outraged by such an idea. On the contrary. I supported the abolition of inheritance tax for assets under a million pounds because I think that wishing to pass your wealth on to your children is only human. But then I am a conservative. I would. I think that the compact between generations is a vital part of social relations.
It’s just that I am a tiny bit surprised to find that people who opposed the inheritance tax cut — indeed oppose the whole notion of inheritance — are enthusiastic about this.
You might wonder why I have gone to such lengths to point this out. Who cares whether this is a left-wing or right-wing idea? All that matters is whether it is right or wrong. Well, not quite. You see, there is the question of when we do this. Believe that Dilnot is correcting a terrible injustice and we need to get on with it. Quick, quick! Old people are dying without dignity! Someone fetch a blanket and a glass of water for those parched lips! We can’t dally a moment longer.
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Understand that this is about inheritance, and things look rather different. I favour it, but I can see it’s a bit of a luxury. It’s something we should get round to, but it would be fine to give it a bit of time, consider how to pay for it, perhaps put it to voters at the next election.
We have been on a long national public shopping spree, and we are only just beginning to pay off the credit card debt. The nature of the sacrifices we will need to make is just becoming clear. We are going to find it hard to pay for prison places and decent benefits for disabled people. This just seems to me like a very odd time to go out and buy ourselves a big fat new inheritance insurance policy.
Eventually, yes, certainly. But now? Surely not.