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‘Put 1p on National Insurance to secure the NHS and social care’, say former Labour and Tory ministers and IPPR

Friday May 25th, 2018

The Government should raise National Insurance contributions by 1p in the pound from 2019 to secure the NHS and social care in this parliament, say former ministers and the think tank IPPR (May 24th). Close-up Of A Doctor Examining You

The change is part of a package of measures for a long-term funding settlement for the NHS and secure funding for social care.

The plan comes from eminent surgeon and former Labour Health Minister Professor Lord Darzi and Chairman of UCL Hospital and former Conservative Health Minister Lord Prior, who are working with the progressive policy think tank IPPR.

The tax hike would be necessary to meet a new, long-term funding settlement for the NHS. The former ministers and IPPR say that the NHS needs at least a 3.5% increase every year—and properly funded social care—if it is to provide good quality care, meet the demands of an ageing population, and embrace technological change.

The plan would deliver more than £350m a week extra for the NHS by the time the UK’s transition out of the EU is complete, compared with funding at the time of the ‘Brexit’ vote in 2016 — but achieved through the increase in National Insurance contributions, rather than by redirecting existing UK contributions to the EU.

Under their proposal, the NHS budget would be guaranteed to increase at least at 1.54% over and above overall growth in the economy — the average rate it has grown at from 1960 to today. This would allow the NHS to plan long-term investments to improve quality and access to care.

Raising National Insurance contributions by 1p in the pound from would raise an additional £12bn a year by 2021/22, matching the additional financing requirements of both the NHS and social care. The changes would be phased in, with a 1p rise for employers in 2019/20 followed by a 1p rise for employees in 2020/21.

Lord Darzi, Lord Prior and the IPPR also back recent proposals to ask the older generation to contribute a little more to health and care costs by continuing employee National Insurance Contributions past the State Pension age for those that remain in work. These changes – along with a 1p increase to the rate for the self-employed – would be introduced in 2021/22 under the plan.

The long-term funding proposal comes from former health ministers Lord Darzi and Lord Prior as part of their review of health and care with the IPPR ahead of the 70th anniversary of the founding of the NHS.

Top NHS surgeon and former Labour Health Minister Lord Darzi said:

The 70th anniversary is a time to recommit to the NHS by funding it properly and for the long term.

We can secure the NHS and social care for the future by asking everyone to contribute a little more in National Insurance—it is a small price to pay for a more civilised and caring society.”

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