London Daily

Focus on the big picture.
Sunday, Jun 21, 2026

No 10 weighs up plan to fix UK social care system with tax rise

No 10 weighs up plan to fix UK social care system with tax rise

Prime minister, chancellor and health secretary discussing manifesto-breaking move, say Whitehall sources
Downing Street is considering plans for a manifesto-breaking tax rise that would be earmarked to pay for fixing the social care system, according to Whitehall sources.

One option being weighed up by ministers is an increase in either income tax or employee national insurance, which could be branded as a social care levy or precept.

The Conservative manifesto promised no increase in national insurance or income tax, but these are deemed the only taxes with a broad enough revenue base to raise the sums required.

The concept of a social care precept already exists for council tax, with local authorities permitted by the Treasury to use it to raise money to fund the creaking system.

Boris Johnson, the prime minister, claimed in 2019 that he had a plan to “fix the crisis in social care once and for all”. No such plan has since emerged, but negotiations have been ongoing in recent weeks between Johnson, the chancellor, Rishi Sunak, and the new health secretary, Sajid Javid, and meetings are expected to continue over the weekend.

Several government sources insisted no final decision had yet been made and it was unclear whether an outcome would emerge before MPs leave Westminster for the summer recess next week.

The current system, widely viewed as unfair, results in some families facing crippling costs of hundreds of thousands of pounds for a loved one to be cared for.

Any deal between Johnson, Sunak and Javid is expected to be modelled on the decade-old Dilnot report, which proposed a lifetime cap on care costs of £25,000 -£50,000, with the balance met by the state.

The plan would be expected to cost £7-10bn a year, or more if the “floor” – the level of household savings at which the state steps in to meet an individual’s care costs – was raised from the current level of £23,000.

The Treasury has traditionally opposed hypothecated taxes, where revenue is allocated for a particular purpose, but it is understood that Sunak would not object to an increase in an existing tax being branded as a levy to pay for social care.

A one percentage point increase in the basic and higher rates of income tax would raise £5.7bn in the next financial year, and just over £7bn by 2024-25.

Javid has insisted he is not ideologically opposed to the idea of a tax increase to tackle the social care crisis. “In all my time in politics I haven’t let ideology blind me to doing the practical and the obvious. I think that’s as far as I’d go,” he told the Telegraph.

When the prime minister was asked about proposals for higher salt and sugar taxes this week, after a government-commissioned review, he said: “I am not, I must say, attracted to the idea of extra taxes on hard-working people.”

But he is also believed to be keen to deliver on the promise he made on the steps of Downing Street two years ago next week. Asked about the issue on Thursday, he said proposals would be published “before too long”.

The 2019 Conservative manifesto promised to build a cross-party consensus on social care reform. Speaking in January last year, Johnson said: “Now we have the majority we need, we are going to get on with this so people can get the care they need in their old age but don’t have to sell their home.” He added: “We have got to think very carefully about how we do it because there are lots of quite important moral and social issues contained in it.”

While there is cross-party agreement that the existing system of funding and delivering social care is unsustainable, governments of all stripes have failed to get to grips with the issue for fear of creating financial losers.

Theresa May set out radical plans for reforming the system in the 2017 manifesto but they were quickly branded a “dementia tax” and her advisers were forced to adapt them on the hoof while she continued to insist “nothing has changed”.

When Andy Burnham was Labour health secretary he sought cross-party support for reforms that would have the costs of care partly met through a “fair care contribution”, potentially levied on patients’ estates after they had died. But the talks fell apart, and the attempt at a consensus approach resulted in the Tories accusing Labour of planning a “death tax”.
Newsletter

Related Articles

0:00
0:00
Close
UK Government Tightens Procurement Rules to Prioritise National Security and Supply Chain Resilience
National Drought Group Reviews Water Supply Risks After Dry Spring and Ongoing Heatwave
Andy Burnham Faces Leadership Speculation After Weak Local Election Results for Labour
Charity Commission Appoints Interim Managers to Barnabas Aid Amid Financial Investigation
Government Awards £27 Million Leonardo UK Contract to Maintain Military Aircraft Fleet
Environment Agency Suspends Chichester Waste Site Permit Over Fire and Pollution Risks
Border Force Seizes Record Cannabis Shipment in Major UK Criminal Network Disruption
Lloyds Banking Group to Hire 300 Artificial Intelligence Specialists in Digital Expansion Push
UK Government Introduces Alcohol Monitoring Tags for 7,000 Offenders Ahead of Summer Sporting Season
Resident Doctors in England Prepare Vote on Government Pay and Working Conditions Offer
Police Scotland Investigates Suspected Anti-Muslim Attacks in Edinburgh Following Arrest
Met Office Issues Rare Amber Extreme Heat Warning Across Southern and Eastern England
UK Government Unveils Digital Homebuying Reforms to Cut Costs and Speed Up Property Transactions
Train Driver Dies and 89 Injured in Rail Collision Near Bedford as Safety Investigation Begins
Long-Term Economic and Political Effects of Brexit Continue to Shape UK Policymaking
Digital Disinformation Emerges as a Growing National Security Challenge in the United Kingdom
Britain's Dependence on Global Energy Routes Drives Push for More Resilient Supply Chains
Rising Energy Costs Continue to Threaten Britain's Cost-of-Living Recovery
Concerns Grow Over Far-Right Organizing and AI-Driven Online Radicalization in Britain
UK-Led Global Partnerships Conference Calls for Reform of International Development Finance
Middle East Tensions Continue to Weigh on UK Business Confidence
Reports of Middle East Peace Deal Ease Pressure on UK Energy Prices
UK Warns Middle East Conflict Could Worsen Global Food Insecurity
UK Economy Loses Momentum After Strong Start to 2026
Bank of England Holds Interest Rates at 3.75% Despite Easing Inflation
Brexit's Legacy Remains Deeply Divisive Ten Years After the UK Voted to Leave the European Union
International Anti-War Conference Opens in London as Debate Over European Rearmament Intensifies
UK Health Authorities Introduce Drug Price Concessions Amid Record NHS Medicine Shortages
Sir David Attenborough Supports Sherwood Forest Conservation Efforts After Loss of Major Oak
Aardman Animations Marks 50 Years With Major Exhibition in Bristol
Drax Cleared After Investigation Into Wood Pellet Sourcing Practices
Jaguar Land Rover Shifts Toward Hybrid Vehicle Production for US Export Strategy
UK Police Arrest Liberal Democrat MP Cameron Thomas on Suspicion of Assault
Health Concerns Grow Over Elevated Kidney Cancer Rates Near Lancashire PFAS Factory
Royal Navy F-35 Jets Conduct First NATO Air Warfare Exercise from Finnish Airspace
UK NHS Issues Price Concessions for Medicines Amid Severe Drug Shortages
Heathrow Third Runway Project Faces Sharp Downward Revision in Expected Economic Benefits
Amber Heat Warning Issued Across Parts of England and Wales as Temperatures Rise
Train Collision Near Bedford Disrupts UK Rail Network and Leaves Multiple Injured
Bank of England Data Suggests Brexit Has Reduced UK Economic Output by Around Six Percent
UK Borrowing Costs Hold Near 4.8 Percent as Political Uncertainty Fuels Market Pressure
Andy Burnham Emerges as Front-Runner to Succeed Keir Starmer After Landslide Makerfield Victory
Prime Minister Keir Starmer Faces Mounting Pressure to Resign After Labour By-Election Defeat in Makerfield
Payment Fraud Losses Reach £1.28 Billion and Raise National Security Concerns
Lending to Small Businesses Climbs to Highest Level Since Late 2024
Middle East Conflict Clouds UK Economic Recovery Despite Strong First-Quarter Growth
Bank of England Moves to Simplify Capital Rules for Smaller Lenders
UK Government Fast-Tracks National Security and Cyber Resilience Legislation
Ofcom Investigates Telegram Over Alleged Role in Organising Arson Attacks
MPs Press Fujitsu to Speed Compensation for Post Office Horizon Victims
×