Letter From The Founder: Andy Burnham Wants to Fix Social Care. Here’s Why That Terrifies Me a Little, and What You Should Do Regardless

I’ve spent a lot of this year writing about pensions, ISAs and the small print of the tax system. Social care rarely gets the same airtime, and I think that’s a mistake.

It’s the one part of financial planning where the rules are so out of date that most people don’t even realise they’re already exposed.

Here’s the number that should worry you. If you have savings above £23,250, the council won’t put a penny towards the cost of your care itself, full stop. You become what’s called a self-funder.

That threshold has been frozen since 2010, while house prices, pensions and general household wealth have all moved on.

It’s worth knowing this isn’t a total blackout though; non-means-tested support like Attendance Allowance, PIP, and NHS-funded nursing care contributions can still apply regardless of savings, and you’re still entitled to a council care needs assessment even as a self-funder. But the core support, the actual cost of care, stops dead at £23,250.

Andy Burnham is now trying to do something about it. He’s made social care one of the top priorities of his premiership, and this week he met Lib Dem leader Ed Davey and the shadow health secretary to see if they can find common ground across parties. Nothing has been confirmed yet, but three broad options are on the table.

The first is the state covering personal care, help with washing, eating, and going to the toilet, and contributing to the cost of care homes on top. That’s estimated at £6.5 billion extra a year, rising to £7.5 billion by 2035.

The second is a lifetime cap on what anyone pays for care, combined with finally raising that frozen means-test threshold.

This is the cheapest of the three by some distance, around £0.5 billion extra next year, rising to £4 billion by 2035.

The third is full NHS-style social care, free at the point of use for absolutely everyone. This is the big one, £18.5 billion extra a year by 2035, sitting on top of the £28.7 billion already being spent.

I think the second option, the cap plus a raised threshold, is the one worth rooting for if you’re trying to protect a lifetime of saving. A cap doesn’t mean care becomes free. It means there’s finally a ceiling on the worst case, rather than an open-ended risk to everything you’ve built. Right now there is no cap at all, which is exactly why some families end up selling a parent’s house to cover fees that simply don’t stop.

There’s a detail here I think is worth flagging. Back in 2010, as health secretary, Burnham proposed a levy that would take 10% off people’s estates after death to help fund a national care service. It got nicknamed the death tax at the time, and it was politically toxic.

The government says there are no plans to bring anything like it back now. I tend to believe that’s true in the short term, but given it’s his own history on this exact issue, I’d want to see how any funding mechanism is actually structured before assuming it’s off the table for good.

Here’s what is worrying me. A cap protects your savings. A new levy on estates would sit alongside inheritance tax, not replace the underlying problem, and could end up taking a further slice of what you pass on.

Those two outcomes point in completely different directions for anyone doing inheritance or long-term care planning right now, and we genuinely don’t know which one we’re heading towards.

So what do you actually do while all of this plays out? You plan for the system as it exists today, not the one that might exist in a few years.

That means understanding where you or a parent sit against that £23,250 threshold now, checking whether Attendance Allowance, PIP or NHS-funded nursing care apply regardless of savings, and being honest about what happens if care costs run for several years rather than several months.

Reform, whenever it lands, will change the rules going forward. It won’t retroactively protect money that’s already been spent under today’s system.

This is an area where the right move depends entirely on your own circumstances, savings, and family situation, so it’s genuinely worth speaking to a financial adviser who specialises in later life and care planning before making any decisions.