Thread by @TimPitt11

Seems like a good day to retweet this thread weighing the policy + political choices on social care funding. Few extra points:

1/ Lots of Tories focussed on the political risk of tax rises – but a tax rise to pay for social care / NHS could actually give them a political boost

https://twitter.com/TimPitt11/status/1417406333242990598

2/ March Budget saw biggest tax rises in 25 yrs + the Tories ended up getting a poll bump from it (albeit there was no manifesto breach). Public are receptive to a government willing to make tough choices, particularly given Covid has heightened their concern re: public finances

3/ Evidence suggests the public quite strongly support the idea of a NICs rise to pay for social care / NHS. See this from @benatipsosmori

ipsos.com/ipsos-mori/en-…

4/ But stakes are obviously v high (there’s a reason personal tax rises don’t happen very often). This type of move could easily backfire + there is high potential for a u turn. Loser in that scenario would be NHS / social care which would likely end up with less funding.

5/ Alternative option is income tax rise. Haven't seen recent polling on this + willing to change my view if it turns out public is equally supportive of an income tax rise. But my hunch is they aren't.

6/ Part of that is historic. NICs have risen regularly over recent decades, under both Tory and Labour Chancellors - and often with an explicit link to the NHS. No Chancellor has raised the basic rate of income tax for half a century.

7/ But part of it is just maths. Using income tax would mean a much bigger direct hit to households because employers don't pay it. To raise £10b, you need to put income tax up 2p; NICs only 1p. For the average taxpayer the diff is the best part of a couple of hundred quid a year

(And yes impact of the employer NICs rise would feed through in wages / prices / jobs - but people don't see that immediately in their pay slips)

8/ Inter-generational point (over 66s don't pay NICs) is clearly an issue from both a political and policy perspective. Any package hopefully will look to address this either directly (e.g. extend NICs to over 66s) or indirectly (e.g. scrap triple lock for this year).

9/ But we shouldn't overplay it. Half of the adult social care budget is spent on under 65s and that group will benefit from funding to clear NHS backlog.

Plus young people themselves support a NICs rise to pay for NHS / social care

https://twitter.com/yougov/status/1417517568257101824?s=11

Bottom line: the politics will likely always mean that tax rises, particularly personal ones, are imperfect from a policy perspective. Risk is we let the great be the enemy of the good - result of which would be less money for NHS + social care /ends