Boris Johnson risks breaking Tory manifesto pledge with 'incredibly expensive' social care reform plans

Boris Johnson will have to break his tax lock pledge to fund social care reform if he insists on his "incredibly expensive" preferred option, Government sources have warned.

The Conservatives made a manifesto vow at the 2019 general election that ruled out increases to income tax, national insurance contributions and VAT.

However, the Prime Minister is coming under mounting pressure within Government to hike taxes if he presses ahead with the so-called Dilnot proposals to reform social care.

Reforming social care was another manifesto pledge and Mr Johnson faces growing clamour to bring forward a plan. He met Rishi Sunak last month to explore options.

The Prime Minister on Wednesday declined to confirm whether legislation on the issue will be announced in the Queen’s Speech next Tuesday, but it is understood he intends to bring forward a blueprint by the end of this year.

Dilnot proposals

The Prime Minister is said to favour proposals first advanced a decade ago for a cap on lifetime care costs for individuals, with the state covering the rest. Sir Andrew Dilnot, the social care expert behind the recommendation, suggested setting the cap at between £25,000 and £50,000, but other thresholds have been floated.

Sir Andrew’s 2011 report also recommended increasing the "floor" - or asset threshold - below which people would receive means tested state support towards the cost of their care from the current level of £23,250 to £100,000.

However, Treasury officials are said to be resisting the plans amid fears over the costs, which could range from £2 billion to £10 billion annually, depending on the levels at which the cap and floor are set.

Matt Hancock, the Health Secretary, also warned that "any solution also needs to consider the financial impact on taxpayers as a whole" when he wrote to MPs and peers last Spring urging them to help secure a cross-party consensus on long-awaited reform.

A senior Government source told The Telegraph: "The Dilnot reform is, at the moment, the frontrunner in the Prime Minister’s mind about what he wants to do.

"The levers you have to pull in terms of paying for it are things that involve breaking the tax lock promise we made, because it is so expensive... incredibly expensive."

The source added: "Where the disagreement is, is you can’t just spend money and not find it in other areas. The thing the PM needs to decide is whether he’s prepared to pull some levers to pay for it or not."

A second Whitehall source also acknowledged dissent in Government over the best approach and said: "Clearly there are tensions in terms of who pays [for social care].

"It [social care reform] was in our manifesto and I still think that the principle of a cap and a floor for people is where most people in Government are at."

However, Downing Street insiders said that a range of options for overhauling social care were still being considered, adding: "No decision has been made."

North-South divide

It comes after The Telegraph revealed on Wednesday that senior Conservative MPs and Treasury officials have raised alarm that the long-awaited reforms risk skewing state support towards those in the South of England.

The Department for Health has conducted modelling of the Dilnot reforms which suggested that a cap of £50,000, while helping up to 200,000 people aged over 65 in care this year, would "disproportionately" benefit the wealthy.

People living in the South East would be on average just under £400 better off than those living in the North East, it reportedly found.

There are concerns that regional variations in property prices could also mean that residents are still forced to sell their homes in some parts of the country - a breach of the Tory manifesto pledge.

Sir Andrew said on Wednesday that tax rises may be needed to pay for the reforms, telling BBC Radio 4’s Today programme: "It’s important to think about how the money to pay for this should be raised. I think it’s perfectly reasonable that some of the money that is needed to pay for it should come from possibly tax increases and those tax increases could perfectly reasonably affect older as well as younger people."

He also acknowledged it was "inevitable" the "biggest gains" from his proposed reforms would not go to the poorest, but argued that this was because they were already covered by the existing "floor" or asset threshold, below which people are entitled to means-tested state support.

"It is certainly the case that if you start off with an entirely means tested system, reforming the system... the biggest gains will tend to go to those who are not the poorest, because they're already looked after by the means tested system," he continued.

"That’s what would happen if you had a means-tested healthcare system, and moved to the NHS. That's an inevitable part of doing something for the population as a whole."

His comments were echoed by Jeremy Hunt, the former health secretary, who said: "I heard every excuse under the sun on social care during my (sadly failed) battles to fix the system as Health Secretary.

"When you have means tested free care for the poorest at the moment, the initial benefits of a cap inevitably help middle income families most initially. The key is to raise the floor at which means testing kicks in (as Dilnot suggests) to make sure benefits are spread equitably."

Warning against further delays after a decade of inaction, which he described as a "stain on our country", Sir Andrew added: "The critical thing is let's look ourselves in the face and decide whether or not as a society we want to help look after ourselves when we are at our most needy. The answer to that is surely yes."

Losing faith

Meanwhile, new research published by the retirement specialist Just Group suggests that Conservative voters are losing faith in Mr Johnson’s vow to fix the system.

According to a survey conducted by the pollster Opinium of 1,000 adults aged over 45, the proportion of Tory voters who are confident the Prime Minister will produce a social care policy in this Parliament has nearly halved from 43 per cent to 22 per cent over the past year.

The research also reveals the proportion who say they are not confident he will produce a policy has nearly tripled from 13 per cent to 37 per cent and now outstrips those who remain confident.