Government’s ‘care Isa’ plan dismissed by Tory health committee chair
I really like Sarah Wollaston and I think her comments here help put this piece of thinking, as potentially part of the solution to the huge challenge (which is bankrupting local authorities) of funding adult social care, back into the THINK AGAIN box. This story tells us…
A senior Tory MP has dismissed proposals for a “care Isa” after it emerged that ministers were considering a tax-free personal savings scheme to cover the rising costs of caring for an ageing population.
Dr Sarah Wollaston, who chairs the Commons health and social care select committee, said the plans were “a colossal mistake” that would only serve as a solution “for a small minority of wealthy people”.
The policy proposal for the new Isa, to be outlined in the government’s upcoming social care green paper, would allow any unspent funds in the Isa after death to be passed on tax free to the holder’s family.
At present, when an individual dies, any money left in an Isa investment is automatically rolled into their remaining estate, which is potentially subject to the inheritance tax rate of 40%.
By axing inheritance tax on the accounts ministers hope that it would encourage pensioners to hold on to their savings into old age, when they are more likely to need to pay for nursing homes and round-the-clock care.
But Wollaston dismissed the plans, revealed in the Sunday Telegraph, as little more than a way to help the well-off pay for their care needs.