Social care cap: What is it and what does it mean for me?

Despite a sizeable Tory rebellion, the government has pushed through changes to the social care cap which change the limit on how much someone in England can pay for their care costs.

Boris Johnson’s majority fell from 80 to just 26 over the proposal, at a time when he is under sustained pressure over missteps around MPs’ second jobs and lobbying. Critics say the way the cap is calculated will mean poorer people have to pay out a disproportionate amount compared to wealthier counterparts. So what does it mean for you?

What changes are being made to social care payments?

Ministers want to limit the amount a person pays towards their own care to £86,000 over their lifetime, while local authorities will pay for any care over that amount. The cap is set to be implemented in 2023.

The cash will come from the national insurance increase – dubbed the health and social care levy – scheduled for April, which the government said would first help the NHS recover from the pandemic before being used to drive social care reforms.

The threshold for getting financial support from councils to pay for ongoing care will also increase, from £23,250 to £100,000. This means people with assets – usually property for those who do not have other sources of wealth – valued up to £100,000 can get support.

People with less than £20,000 in assets will pay nothing for their care, people with assets over £100,000 will get no support. Those with assets between £20,000 and £100,000 get support on a sliding scale.

The government tabled an amendment to the Health and Care Bill which concerned MPs across all parties as well as campaigners and charities.

Many people on low incomes receive means-tested payments from local authorities which go towards their social care but, if the amendment passes, these will not count towards the £86,000 cap under the amendment.

Why are people saying the changes are unfair?

The £86,000 limit on personal contributions is universal, which means people with a lower level of personal wealth will have to contribute a higher proportion of it than rich people.

If someone has a house and savings worth £172,000 and has never paid for any social care before, they must contribute £86,000 — half of everything they own — to the costs of their care before they get any help.

If someone has combined assets over £1,000,000 and has never paid for any social care before, they will also contribute £86,000 before they get any help, even though that is less than 10 per cent of their wealth.

House prices in the south are generally much higher than in the north, meaning there will be a regional impact of the new cap at a time when Boris Johnson is determined to prove he is “levelling up” previously poorer areas.

The government is also removing means-tested payments from councils when calculating how close someone is to reaching the £86,000 cap, payments which are largely paid to people struggling to make ends meet. This goes against the original proposals put forward by economist Andrew Dilnot in 2011, which stated contributions from both an individual and the local authority would count.

Dilnot told MPs he was “very disappointed” and said the cap would now be of much less benefit to people on lower incomes.

“It will tend to hit people in regions of the country with lower house prices harder than it does those in regions with higher house prices,” he said. 

“There is a north-south axis to this, that people living in northern and other less high house price areas are likely to be hit harder by this on average.”

People in the north of England, which has higher levels of deprivation, are more likely to experience long-term health problems and need social care support. The plan will also hit the people on low incomes already most likely to struggle when national insurance payments increase to fund social care reforms.

Liz Kendall, Labour’s shadow social care minister, warned the government’s proposal is “an even bigger con than initially thought”.

“It has now been revealed that the poorest pensioners will have to pay even more,” she said. “That this Tory government has failed to be straight with those who’ve given so much to our country is a total disgrace, but utterly unsurprising. Our elderly people deserve better.”

Business minister Paul Scully refused to deny that people could still have to sell their homes to pay for their care under the new social care cap.

“There will be fewer people selling their houses and hopefully none,” he told Sky News. “I can’t tell you what individuals are going to do.”

Robert Buckland, the former justice secretary, was the first Conservative MP to say he would be voting against his own party, and a total of 18 Tories rebelled against the government in the vote on Monday night and 70 Conservatives had no vote recorded, many of whom abstained.

Torsten Bell, chief executive for the Resolution Foundation, said the plans would offer “little protection” to poorer people while doing “much more for those with significant assets, especially in the south of England.”

What did Boris Johnson say about social care?

The prime minister said the social care cap plan “helps people not just who are in residential care but also people who benefit from domiciliary care as well”.

‘We are finally tackling a problem that has bedevilled this country for decades,” Johnson added. The social care funding system has been “very, very unfair on people who have got dementia or Alzheimer’s and been forced to face catastrophic, ruinous costs for that care when somebody who has cancer or some other affliction does not,” he said.

“We are addressing a long-standing social injustice and it will benefit the people of this country.”

What is covered by social care?

Social care costs are not just a problem for pensioners. People with long-term illness and disabilities – who are more likely to live in poverty or with a very limited income – often face a lifetime of eye-watering costs to cover the services they need.

These can include help in the home from a carer, expensive home adaptations and household equipment, home security systems for those more likely to need to call for help, meals on wheels, and residential care such as supported living and care homes.