Pensioners could have to pay National Insurance contributions to fund care

21 March 2018

Ministers are considering increasing taxes on older workers as part of plans to increase funding for the NHS.

The Telegraph has reported that it is understood there is now broad agreement within the Cabinet that extra money must be provided for the health service.

Reportedly it appears that officials are drawing up plans for a more targeted tax rise on older workers as part of a new 10-year funding plan for the NHS championed by Jeremy Hunt, the health secretary.

One idea under discussion that the Telegraph refers to is to make the 1.2 million pensioners who keep working past 65 to pay National Insurance contributions (NICs). The move would raise £2 billion per year which could be spent on the health service. An even more radical approach was reported and that was the plan to increase the standard rate of NI by a penny for all taxpayers but this has been rejected by the PM and the Chancellor. Also, under discussion is the scrapping of universal free prescriptions for the over-60s.

Mr. Hammond, the Chancellor signalled in his Spring Statement that an improved forecast for economic growth would give him extra cash to spend on public services in the budget in November, but Mr. Hunt is urging him to consider more radical, permanent changes to healthcare funding.

Read the full press release here.