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Impose a death tax to pay for Dilnot care reform, says MP

Former minister Paul Burstow has called for benefit cuts and new taxes to fund a £60,000 cap on long-term care costs for the elderly.

 

by Michelle McGagh on Jan 03, 2013 at 13:54

Impose a death tax to pay for Dilnot care reform, says MP

Liberal Democrat MP Paul Burstow has called for the coalition to implement a £60,000 cap on care costs, which could be paid for by reducing the winter fuel allowance for wealthy pensioners and imposing a 'death' tax.

Burstow (pictured), a former minister of state for care services, said Andrew Dilnot’s report that sets out reform of old age care services should be put into place. However, the MP for Sutton, Cheam and Worcester Park believes the cap on care costs should be set at £60,000 rather than the £35,000 cap recommended by the Dilnot commission.

The coalition has already delayed an announcement on how it would pay for the limit on care costs but Burstow has come up with a solution: remove winter fuel allowance from nine million older people and abolish tax breaks for those inheriting second homes or other high-value items, he says.

Burstow said the recommendations of Dilnot (pictured) were ‘the only viable option’ for ‘securing the future of care in this country’.

He also lambasted the Treasury for failing to come up with a funding proposition for the reforms.

‘Treasury officials have tried and failed to knock them down or come up with an alternative and their silence on the matter is deafening,’ he said.

Burstow made his comments known in a paper, 'Delivering Dilnot', by the CentreForum think-tank.

In the paper, he urged the coalition to link winter fuel payments to pension credit which would raise up to £1.5 billion a year ‘while protecting the poorest against cuts in their weekly incomes’.

He also championed a ‘capital gains tax at death’ which would raise £600 million a year. ‘

‘This means that the Treasury could save over £2 billion a year to pay for a Dilnot care system at a cap that would still protect those who so desperately need it,’ said Burstow.

10 comments so far. Why not have your say?

Drogue

Jan 03, 2013 at 14:40

Why not take all our money at source and give us all an allowance to live on for the rest of our lives.

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Clive B

Jan 03, 2013 at 14:52

The year might have changed, but Lib Dems don't - another idea for a new tax (or two).

Ignoring the taxes, I take issue with the suggestion that people be allowed to stop paying for themselves if their wealth falls below £100K.

I'm OK with inherited wealth. If there's money left over in your estate when you've paid your way in life, I have no problem you leaving it to kids, grand kits, save the donkeys or whatever.

But, I do object to the idea that you're old, have £100K and say "heh Clive, I need to spend money on myself (for my care), but I'd prefer to leave this money to my kids/grandkids. How about you - as a taxpayer - pay for me. What, you're a lot less wealthy than me and don't have £100K ?. Never mind, I'd still prefer you paid, so my little nest egg is left alone".

Back to basics - benefits (and this is what we're talking about with taxpayers funding care) - should be for those genuinely unable to provide for themselves. People with £100K in the bank (or in an asset like a house), don't fall into that category imo.

Time the state changed to say "you want it, you pay for it"

Happy New Year !

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Peter

Jan 03, 2013 at 16:25

"Time the state changed to say "you want it, you pay for it"

It's the old problem - blow your money having a great life, and the state picks up the tab for "poor" old folks. But organise your affairs diligently, and the state simply takes it away.

What I've never seen in regard to state benefits is an assessment of someone's earnings over their lifetime, so that those who have squandered their opportunities don't end up getting bailed out.

Earned £50k pa but got nothing -the state pays (you're a poor old pensioner). Earned £25k pa, but scraped by paying your mortgage, not having great holidays and only cheapo second hand cars (if any), tough - sell your house - you're a wealthy member of the property owning middle class.

Fair?

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snoekie

Jan 03, 2013 at 17:50

Typical of the far left gibdems, spending other peoples money on their pet projects.

There should be a law against them.

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Will Clynes via mobile

Jan 03, 2013 at 18:44

Men have an 80% chance of needing no personal care during their lifetime. Women have a 66% chance. Sort the pension crisis first.

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andy

Jan 05, 2013 at 10:16

Peter >

I am with you on this. I wish the government would set the rules - and leave them alone - so that I can arrange my affairs accordingly.

It is infuriating all this tinkering - same with pensions. Stop interferring!

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White Stick follower

Jan 05, 2013 at 12:51

Is not IHT a death tax/ Perhaps Burstow envisages a tax on all deaths. What will he do if the decease does not or cannot pay- dig up the remains, or recover the ashes?

What about a 'breathing tax'? Difficult to measure of course, but we all do it. Alternatively perhaps MP's benefits should be cut/abolished, but I suspect there is more chance of snow in hell than that.

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Roger Bacon

Jan 05, 2013 at 18:42

Always been uneasy at double taxation of the same amounts ... but triple or quadruple !. We earn and pay income tax and NI. We invest our earnings and pay income tax again. We use our savings to buy a house and use part of them to pay stamp duty..... not to mention council tax ... We die and if we've been frugal or sensible (or stupid) and not spent our money we then pay inheritance tax !. Not to mention VAT on all that taxed income which we go out and spend on necessities such as clothes, holidays (bah humbug , shouldnt take holidays) and things for our children. Now they're talking about some capital gains tax at death too !. Hold on folks , isnt it about time government spending was cut properly ! And ..... higher rate tax now starts at about 40k !. Try living in london on that.

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White Stick follower

Jan 06, 2013 at 14:05

No doubt our largely very rich 'ruling class' has already ensured that familial assets are secured in impenetrable Trusts, well beyond the reach of Treasury & Local Authorities.

As for the ever growing State spending might not there be substantial savings made if we, bar life saving emergencies, focussed on supporting our own citizens, without the endless procession of those from the rest of the World? State benefits of the type mentioned by Burstow are part & parcel of the concept of National Insurance, the key word being Insurance. Can anyone imagine a commercial Insurer paying out to an individual who had no policy, and/or had paid no premiums?

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David Walker

Jan 06, 2013 at 18:13

Plerase cease these irritaing pop-outs

Happy New Year

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