The Proposed Levy
Prime Minister Andy Burnham is planning a major overhaul of social care funding, with officials drawing up a 1.8 per cent levy on earnings for workers over 34 who earn above £6,240 annually. The Department for Health and Social Care (DHSC) has developed proposals requiring mandatory contributions to a new privately managed fund, aimed at generating £18bn per year to support a reformed care system.
The levy would apply to all earnings above the £6,240 threshold, targeting working-age individuals to ensure contributions are made while people are still in employment. The plan is part of Burnham's long-standing commitment to fix social care, a promise he has reiterated since taking office.
Political Capital and Cross-Party Talks
Burnham stated he would use "whatever political capital I have" to address the crisis and start a "conversation with the public" about funding. He emphasised the need for cross-party collaboration, saying: "I would like to see if we could arrange talks, cross-party talks, to build that spirit of collaboration from the start. This issue requires a solution that is lasting, cross-party, and is one that the country can support. So the more we go forward on that basis, the better."
The Prime Minister hopes to begin with short-term agreements between parties and then build toward a longer-term solution, acknowledging that previous attempts at reform have faltered due to political divisions.
Expert Reactions
Seb Rees, head of health at the Institute of Public Policy Research, commented: "To succeed where others have failed, the Prime Minister needs to set out a more ambitious vision for reform – not just protecting assets or easing NHS pressures, but investing in a system that helps people live well. That vision must be backed by a clear plan for the costs, how they’ll be shared fairly, and why the investment is worth making."
Sarah Woolnough, chief executive of the King's Fund, noted Burnham's consistency: "He has been consistent on this point for 20 years. He could offer free personal care as a first stage: help with washing, eating and going to the toilet, like they have in Scotland. This would be a stepping stone to a more general system."
Impact and Next Steps
The proposed levy would affect millions of workers, raising questions about affordability and fairness. With an £18bn annual target, the government aims to provide comprehensive care for an ageing population, but critics warn of additional financial burdens on younger workers already facing high living costs. The DHSC is expected to publish further details in the coming months, with a public consultation likely before legislation.
