Back in the 80’s Margaret Thatcher arranged for people to become homeowners after years of being council tenants. Now I’m not going to get into the rights and wrongs and the policies behind this action other than to ask what happened to the money raised because it certainly wasn’t used to build more council homes for the up-coming generations.
So for 30+ years former council tenants have been home owners. Many appreciated this action by the Tory government and showed their appreciation by becoming Tory voters. I have some in my family that have struggled through life in a ‘just about managing’ way but because they now own their former council house have voted Tory since the 80’s. So if Thatcher’s plan was to convert a large number of former renting Labour voters into Tory voters we can all agree the plan was a success.
But now it’s time to hand the property back to the Tories. Did you really think it was yours to keep?
If I can return to my family members for a moment. Now as I said they come from the ‘just about managing’ group. This means they have never had the £23,000 or so that would have exempted them from the social care costs. However, under the Tory proposals to change the threshold they have ample cash and so can pay for every penny of their social care.
The Tories claim they plan to INCREASE the ceiling on social care payment thresholds to £100,000 for all.
THIS IS A BLATANT MISDIRECTION
They do plan to increase the ceiling but the question is how. Let’s look at two pensioner families, one is a house owner with a house valued at £200,000 the other never bought his/her own house but has a nice little nest egg of £100,000..
Pensioner A with his/her nest egg of £100,000 in personal assets. Say stocks and shares, a nice little bundle in the bank or whatever will now enjoy free social care in his/her home.
Pensioner B will be forced to release £100,000 of the equity in the house in order to pay for social care in the home. At this point it is not clear who will supply the money for these equity releases but based on past performances it will probably be the market. Now it is well established that the rich do not put investments into equity release companies as an act of generosity. So it follows there will be interest to pay. Probably at around 6%, the market norm. That will eat a big hole in the remaining £100,000 which if we calculate it on the above figures will be 3,279.72 a year.
Now the Tories say they want to do this to bring about fairness. For the life of me I cannot see where the fairness comes in. Part of the Tory argument is that pensioners in residential homes have to pay with their property so it is fair that (some) of those still in their own homes should as well.
Interesting isn’t it that the Tories always go for the lowest denominator when it comes to the majority of us and yet top people should get more because some other top person has more.
My personal view is all pensioners should get social care free at the point of contact and as required. That is why we all spend a lifetime working and paying taxes (well most of us that don’t have access to overseas tax havens). Protecting the vulnerable is what a decent society does. OK so the argument comes up what about the wealthy. They will get it as well. Yes they will but there are so few of them and so many that need our care. Why should we punish the vulnerable to prevent those that would not even notice the money from getting it. A rather perverse argument.
So returning to my family, I should say they are both disabled and will no doubt both at some point be facing social care needs. They certainly hoped to leave their house to their lovely grandchildren. Well the way things look they will probably be leaving the vast bulk of it to some investing billionaire.
I wonder if they will be voting Tory on June 8th?