Burnham Proposes National Care Service Amid Pension Funding Warnings

Prime Minister Andy Burnham has proposed the creation of a National Care Service to reform social care and prevent citizens from selling their homes to fund elderly care. To implement this initiative, Burnham tasked Louise Casey with developing a delivery plan based on specific government principles and conditions.

This proposal follows other recent spending commitments from Burnham and Chancellor John Healey, including capping bus fares at £2 through 2027, cutting VAT on electricity bills in October, and maintaining a defense spending target of 3.5% of GDP by 2035. The National Institute of Economic and Social Research (NIESR) warned that these pledges, combined with inflationary pressures and a £15bn GDP loss linked to conflicts involving Iran, the United States, and Israel, have put the state pension triple lock at risk.

Stephen Millard, NIESR's Deputy Director for Macroeconomics, asserted there is no scope for further government borrowing. He advised the administration to fund its priorities through tax reform or spending cuts, specifically identifying the expensive triple lock on pensions as a primary target. The Institute for Fiscal Studies estimated the annual cost of the triple lock between £12billion and £12.6bn. Without these adjustments, NIESR noted the government might eventually be forced to break a manifesto pledge to avoid raising income taxes for working people.