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Damian Green, the former first secretary of state, was on the Today programme this morning promoting a plan he has drawn up for a national care fund, to pay for social care. It would everyone having to contribute something – effectively, compulsory insurance – but the key feature of his proposal is to get pensioner homeowners to use equity release to pay for their contributions, unlocking some of the vast wealth tied up in property.
He told the programme:
It’s a staggering amount of money. It is 1.7 trillion of equity owned by over-65s with no mortgage left on their homes. A very small amount of that could solve a lot of this crisis …
My suggestion would take a very small part of that wealth and leave them significant amounts of money to hand on to their children, because I absolutely accept that inheritance through the generations is important.
The £30,000 figure is purely illustrative, and I am conscious of two caveats. One, that government would still need to cover the long tail of the small number who incurred the most costs, and secondly, that those with no equity would still need to be covered by taxation.
But this radical policy would meet some of the most difficult political concerns.