A Conservative promise to “fix” Britain’s broken social care system by imposing a cap on costs has been thrown into doubt, with Rishi Sunak preparing to announce a major delay.
Boris Johnson’s flagship policy on social care will reportedly not be introduced before 2025 in a move expected to save at least £1bn a year.
It means the prime minister and his chancellor Jeremy Hunt will not have to feature the cap in next week’s autumn Budget – pushing the issue back until the next spending review.
Mr Sunak suggested an “indefinite” delay to the cap before accepting that it should initially be postponed for two years to avoid political damage, according to The Times.
Mr Johnson announced outside No 10 “that we will fix the crisis in social care once and for all” as he took power in July 2019.
As chancellor, Mr Sunak later pledged to bring in an £86,000 limit on the amount Britons have to spend on personal care, as well as making means-tested support more generous.
The then-chancellor had also announced plans to raise national insurance in a special levy to help fund the social care plan – but the idea was ditched during Liz Truss’s short-lived premiership.
Former cabinet minister Nadine Dorries was among the Johnson allies criticising the apparent U-turn on one of the former PM’s big commitments.
“Given everything Hunt said when chair of [health select committee], I’m very surprised,” the ex-culture secretary tweeted. She added: “It would cost £1b in 2023/24 for desperately needed reforms – a Treasury rounding error figure.”
While the delay could save £1bn in the first year, is thought to rise to £3bn a year if the social care policy were kicked into the long grass indefinitely.
Mr Sunak and his Mr Hunt are said to mulling a 50-50 split of spending cuts and tax rises to address a black hole in the public finances of up to £60bn.
They are said to be considering raising the top 45 per cent rate of income tax, or lowering the threshold for the top rate below £150,000 to pull in more wealthy people.
Iain Duncan-Smith warned that there would be “deep concern” among Tory MPs “if we go over the top on tax rises”. Up to 50 MPs could vote against any “outlandish” rises, one former cabinet minister told The Telegraph.
Meanwhile, Institute of Fiscal Studies analysis has found that plans to extend the freeze on income tax allowances could raise £30bn a year by 2026, more than previously estimated, due to inflation.
The prime minister will urge Nicola Sturgeon and other devolved leaders to be “pragmatic” about spending cuts at face-to-face talks on Thursday.
The Scotland’s first minister and SNP leader is expected to stress the importance of avoiding “damaging austerity” measures.