Socialising Risk

The principles which underpin Britain’s Welfare State are collectivist.  Society as a whole shoulders the burden of health costs so that no-one suffers by being unable to afford necessary treatment.  There is no reason why social care should be treated differently.  Everybody is at risk of needing social care, especially towards the end of their lives, and this can last for several years in some cases.

The Conservative Party manifesto for the 2017 general election contains proposals for covering the costs of social care which are individualist: the opposite of collectivist. Someone who needs a lot of care might pay most of the cost under these proposals – but those who die quickly wouldn’t have to pay tax to cover other people’s costs.

Ministers quite rightly point out that the total cost of social care is rising rapidly and it has to be funded somehow. Ever since Margaret Thatcher’s government, the party has followed individualist policies – so paying for one’s own care seems more attractive than asking everyone else to pay towards it.

The problem this time, though, is that wealthy people (who tend to support the party) stand to lose the most. They applaud low taxes, but they don’t like the risk that they are exposed to.  The outcry has already resulted in a government U-turn and Theresa May has, in a trice, lost her reputation for strong stable leadership.

If the party were true to Thatcherite principles, it would have held fast despite all the criticism.  Wealthy people could buy insurance to reduce the risk of being unable to pass their wealth to their children.  Even if such insurance policies are not yet available, financial services companies will quickly spot an opportunity to develop them.

Such a proposal would be very similar to the American Republican preferences on health costs: keep taxes low and let people choose whether to insure themselves against the risks.

British voters are presented with a clear choice between the principles of the welfare state or the individualist mantra of everyone being responsible for their own financial situation.

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