In a Home Care Insight exclusive, the chief executive of Care England, Professor Martin Green, and Busy Bees founder John Woodward talk to one another about how they envisage people using Adult Social Care Vouchers to fund their care.
John Woodward: The social care system doesn’t work as it is. There’s not enough money coming in. The answer for the whole thing is relatively complicated, but a salary sacrifice scheme for adult social care works. It seemed obvious to me that if you can do salary sacrifice vouchers for one thing, you can do them for another. I am proposing a salary sacrifice system whereby the individual tax payer can sacrifice a portion of their salary to pay for care for themselves or their dependents. This will offer savings on National Insurance contributions for employees and on tax for employers. It will also be a tax saving for the employer, so it will encourage them to help their employees.
Martin Green: The other thing that is so good about it is that it puts the power in the hands of the people and their families. It’s so practical and deliverable and has been proved in nursery education so it’s a very easy leap to say it can be used in social care as well. It also doesn’t require the government to do very much. It gives autonomy and control to the person that uses the services and their families. It puts more money into the system so that it can benefit as well. It’s a complete win-win but some of the easiest, simple and solutions are always the last things on a politician’s mind.
Martin Green – I am absolutely convinced social care vouchers can transform the long term care debate
JW: It doesn’t work for everybody. If you have never paid tax in your life, this has no benefit. It’s also the only funding solution I know where employers can be involved. Lots and lots of employers want to help with this issue. Employers can say to their employees we will help to pay for your social care and make your life a little more comfortable.
MG: Lots of people are probably looking after their parents from a long distance so what they need are the resources to be able to put services in so they can be confident that their loved one is being looked after. This benefits the person who is making the salary sacrifice and the employer can feel they are doing something useful. It would help avoid losing employees who have to attend a crisis with their parents because they don’t have the money to put emergency support in and it also gives people a lot more choice in the services they want to purchase. It’s incredibly useful on so many levels.
JW: If you, over your lifetime as a tax payer, put money into this system and if in the end you don’t need it, it becomes part of your estate or you can take it out and pay the tax and national insurance and you get it back as if you’ve earned it. It’s a simple system. People can pay into it at different times. Some people will do it as they become tax payers and some won’t. They will be able to top it up at a later date. It’s their choice.
Martin Green – Our strategy has been to flag this up through the Green Paper process but also directly through the Treasury because the bottom line is that where the power lies.
MG: If you weren’t going to use the money for your parent’s long term care or your own long term care you might want to use it for your child for their tuition fees. One of the things that is so great about it is its flexibility. It enables people to draw down money in ways that are really helpful to them. The genius of this is that when you set up the childcare vouchers, you had a problem you wanted to solve and you managed to persuade the government that it was a good idea. It’s also had years of it working. I am absolutely convinced it can transform the long term care debate. No-one had drawn the link between childcare and adult social before because they sit in silos. You connected those dots.
JW: I would like to have a system where there is one salary sacrifice, capped at a certain amount and you could use it for child care and adult social care, as well as for bespoke support services for the elderly and vulnerable, such as gardening or help with doing the weekly shop. Let’s get this going and then look at how else we can do it. I think we can use this to help people stay in their homes more.
John Woodward – Every care provider we have spoken to thinks it’s a good idea because it makes care more affordable
MG: Our strategy has been to flag this up through the Green Paper process but also directly through the Treasury because the bottom line is that where the power lies. I think the Treasury can see that this is a workable scheme. I think they can see that is something they can do immediately and it is not going to have huge implications for them. I think we could their get nod on this on the basis of doing a pilot. It gives the government an opportunity to say they have done something. It makes a difference.
MG: There might be employers who say they want to put some money into their employers’ schemes to encourage retention. If I was a politician and people have had the choice and decided not to do it, I would feel much more comfortable going to them and saying I am not going to give you state funded provision because you had the opportunity to do it and you made the choice and there will be a consequence to that. It might be that you can buy some domiciliary care when you need it, or, if you have had a fall, enabling you to buy three weeks of residential care.
JW: I want businesses to be able to invest in this and get their returns capped so people can do things and make money out of it, but not too much and everything else goes back into the system. Every care provider we have spoken to thinks it’s a good idea because they get an amount of money on a regular basis, they don’t have to hassle people and it makes their care more affordable. Hundreds of thousands of people have benefited from it and it is a system we have proved works.