Adult Social Care

Part of Backbench Business – in the House of Commons at 4:38 pm on 8 March 2012.

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Photo of Kelvin Hopkins Kelvin Hopkins Labour, Luton North 4:38, 8 March 2012

We must start getting the system right somewhere. We can adjust taxation provision in other ways in the short term, but in the long term we must have a properly progressive taxation system to pay for adult social care. I have just been to Denmark. Many Government Members and others say that high-tax countries are weak economies, but the tax take in Denmark as a proportion of gross domestic product is 18% higher than in Britain. The Danish have free tuition at universities, and students are paid €5,000 a year to go there up to the age of 25. I am not saying that we should do that, but I am making the point that taxation at that level, provided it is fair and progressive, does not ruin economies.

It is matter of choice. I have told the story of my young children many times in the Chamber. When my son asked for a second ice cream, my wife would say, “Mummy can’t afford it.” She was saying not that we could not afford it—we could—but, “You’re not having another ice-cream.” When people talk about affordability, they are saying, “We choose not to pay.” Those who constantly campaign for a low-tax society are doing down people who are in need. We must accept that if we want to be looked after when we are in need, we must pay taxes.

When people on the doorstep ask me what my problem is, I say, “I don’t pay enough tax.” I am sure other hon. Members do not say that. My income is now more than sufficient for me to live a very comfortable life, but the income of many young people is not sufficient for them. There is nothing wrong with shifting the burden of taxation to those who are on higher incomes or those for whom most expenses are over. It is unfashionable to say such things, but I happen to believe they are right.

I mentioned the care homes in my constituency, but another issue is that of payment. Our tax gap was not so long ago estimated at £120 billion a year. If we collected just 5% of that, we could pay for free long-term care without a problem. To be fair to the Government, they are starting to wake up to the need to close that tax gap—not enough, but a bit. We have left it alone for too long, because they do not want to upset rich people who are investing in the Cayman Islands or wherever.

The Government are starting to put a little pressure on and are employing a few more tax collectors. I know from my local VAT office that every inspector collects many times their own salary, so why not employ many more to get the VAT in? People recently went to prison for a tax fraud whereby they used VAT for import and export. Such people make billions out of hon. Members and our constituents. Let us round up a few of them and stop that loophole, and ensure that people who are well off and who should pay taxes do so.

I have known Andrew Dilnot for many years—he is a civilised, highly intelligent and wholly admirable man. He did a good job in his report of trying to find the fulcrum point—the Treasury might just wear what he is proposing, but if he went further it would probably say no. There is a parallel with Adair Turner, another intelligent, civilised man. He tried to change the tax system a bit. He knew that if he pushed the Treasury too far, it would react and he would not get what he wanted. Indeed, he had a hard job persuading the previous Chancellor to accept his proposals.

The authors of those reports try to come up with recommendations that will be acceptable to the Government and the Treasury instead of coming up with what they believe to be a strong position. The problem is not the electorate, but the Government and hon. Members on both sides of the Chamber. Ministers and officials will not accept the approach I suggest for a more civilised society.

Like all hon. Members, I do a lot of public speaking. I say, “What would you choose? Would you take the risk that your family member’s house will be compulsorily sold, and all the money used to look after granny, or will you pay a tiny bit more tax over a lifetime to make sure that granny is properly looked after without being forced to sell the house?” For wealthy people, that does not matter, but it does matter for many working class people, including first-time owner-occupiers. In many cases, they have bought council houses, which I do not believe is a good idea. They have a bit of equity in their family for the first time ever and it can be used to help their children—or grandchildren usually—to stay in the owner-occupied sector, but it is being eaten away by their being forced to pay for care for elderly relatives. Indeed, owner-occupation is now falling as a proportion of housing tenure. Whatever one thinks about owner-occupation or renting, that is happening, and a factor in that might be that people are being forced to sell houses to pay for care, and the equity is in effect being lost in rich taxpayers’ pockets, because they are the ones who can get away with not paying enough to ensure that granny is looked after.

We have to accept that people are living longer. We have not found a solution yet to Alzheimer’s or dementia. I hope that we do—it will solve many problems—but while we have not, we have to ensure that elderly people are cared for, which means that we have to pay for it properly. We will all get old one day, and we all might need this care one day. Certainly, for me and my family, I want to ensure that, as and when any of us need that care, it will be there for us and provided properly in a civilised and caring way.