Breaking Essex

A new health and social care tax will be introduced across the UK to pay for reforms to the care sector and NHS funding in England, the PM has said

Boris Johnson said it would raise £36bn for frontline services in the next three years and be the “biggest catch-up programme in the NHS’ history”.

He accepted the tax broke a manifesto pledge, but said the “global pandemic was in no one’s manifesto”.

However, Labour leader Sir Keir Starmer said the plan was a “sticking plaster”.

The tax will begin as a 1.25% rise in National Insurance (NI) from April 2022 paid by both employers and workers, and will then become a separate tax on earned income from 2023 – calculated in the same way as NI and appearing on an employee’s payslip.

Income from share dividends – earned by those who own shares in companies – will also see a 1.25% tax increase.

Mr Johnson said the proceeds from these rises would lead to £12bn a year going into catching up on the backlog in the NHS created by Covid, increasing hospital capacity for nine million more appointments, scans and operations.

And he pledged that by 2024/25, there would be the ability to help 30% more elective patients than before the pandemic.

The money will also go towards changes to the social care system, where a cap will be introduced on care costs from October 2023 of £86,000 over a person’s lifetime.

All people with assets worth less than £20,000 will then have their care fully covered by the state, and those who have between £20,000 and £100,000 in assets will see their care costs subsidised.

Mr Johnson insisted that with the new tax “everyone will contribute according to their means”, adding: “You can’t fix the Covid backlogs without giving the NHS the money it needs.

“You can’t fix the NHS without fixing social care. you can’t fix social care without removing the fear of losing everything to pay for social care and you can’t fix health and social care without long-term reform.

“The plan that this government is setting out… will fix all of those problems together.”