Monday, 27 August 2012

Andrew Dilnot and honest political debate in the UK – 1

Time was when Sir Michael Scholar was the chairman of the UK Statistics Authority (UKSA) and he said, among other things:
“One of the reasons I took this job is that having good statistics is like having clean water and clean air. It’s the fundamental material that we depend on for an honest political debate ...”
You may want to tweak Sir Michael's point a bit. You may prefer to say that there are many fundamental materials, not just "good statistics", whatever "good" means. But if you're interested in honest political debate it's hard to gainsay him, Sir Michael is onto something.

Now he has passed the baton, and it is Andrew Dilnot who is chairman of the UKSA and who leads the Government Statistical Service and thus the Office for National Statistics (ONS).

Mr Dilnot has investigated the problem of social care for the elderly and recommended to the government that there should be a cap of £35,000 on the amount anyone is expected to pay for their care. Thereafter, the government should pay for it, he says, even if the elderly person has assets of their own, such as a house which could be sold to pay for their care.

It is impossible now in the UK to get insurance cover for social care in your old age. Mr Dilnot recently described that to the BBC as a "market failure". He's wrong, isn't he? If the market values your house at £350,000, say, then thanks to the market you can afford about 100 months in a decent old people's home. The market has not failed and Mr Dilnot is wrong to say that it has.

In the same BBC interview, Mr Dilnot describes the state stepping in and taking over the payment of your social care as you "taking control of your life". Surely it's the opposite. It's the state taking control.

The cost of implementing Mr Dilnot's £35,000 cap is estimated – very possibly by the ONS – to be £750 million p.a. That is just over one one-thousandth of current public expenditure ("one per mil" or "1‰") and so, Mr Dilnot says, his plan should be adopted as government policy.

An annual contribution of £750 million to the DMossEsq executive pension plan would also represent only about 1‰ of public expenditure. Is that a reason to make such a contribution?

It's all very well chatting about what individuals can afford but there are other questions:
  • How much can the state afford?
  • Public spending in the UK stands at about £700 billion p.a. at the moment, of which about £150 billion is borrowed. Is it sustainable to continue increasing the tax burden and the level of borrowing? How long can we go on printing money, through quantitative easing or any other technique? What happens to inflation? And interest rates? And exchange rates?
  • With our £2 trillion national debt*, aren't we supposed to be looking for ways to cut public spending, and not increase it? When do we have to confront reality?
  • If we can raise another £750 million in tax, or borrow it, why spend it on social care for the elderly who own a house? Why not eye care? Or dental care? Or subsidised taxies? Why not reduce the excise duty on tobacco?
  • Why spend the money on a problem that doesn't need solving? People just need to sell their house and then they're in funds. Why not try to solve a real problem?
  • Is social care for the elderly who can afford to pay for it themselves a legitimate matter for the state to involve itself in? If so, is there any limit to state involvement?
  • Could the budget on some other less vital public services be cut by £750 million to pay for Mr Dilnot's dream?
  • The standards of some care homes for the elderly are exemplary and in other cases the standards fall below the level we expect of a zoo. How does Mr Dilnot propose to ensure that public funds will provide dignified care and not sub-zoo care?
  • Mr Dilnot considers individuals on the one hand and the state on the other. That doesn't exhaust the cast of actors in this play. Among others, there are families in between. Are families avoiding their responsibilities? Is the problem of social care for the elderly a failure of families? What does Mr Dilnot propose to do about that?
He doesn't burden the BBC with any of these questions. Or any answers to them.

With Mr Dilnot now in charge, the water is just a little cloudier and the air just a little less Swiss – what price "honest political debate" in the UK?

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* The Times, 27 August 2012, Confusion reigns over the state of British debt:
A poll for the Centre for Policy Studies found that far more people wrongly believed that the coalition intended to cut debt over the next few years than correctly believed that it expected to increase it ...

While planning to bring down the annual deficit — the difference between what the Government spends and the money it receives and the amount of extra borrowing it incurs each year — the coalition nevertheless expects to lift total government debt by £600 billion between 2010 and 2015 ...

Total government debt is £1.03 trillion, equivalent to 65.7 per cent of Britain’s total national output. Add in liabilities kept off the balance sheet and it doubles to more than £2 trillion ...

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