The Tories social care cap is a deeply regressive wealth tax that will hit those with least the most

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There are two ways to view the government. One is that it is one continual cock-up after another. There is a lot of evidence for that, especially at this moment. The other is to think that underneath the veneer of distracting mismanagement there are deeply cynical plans to make the UK a worse place to live for the majority who live here.

The announcement of the cap on social care yesterday falls firmly into the second category. As the Guardian explains:

The cap is a lifetime limit of £86,000 on how much individuals will have to pay towards their care costs. First proposed more than a decade ago by the economist Sir Andrew Dilnot in a government-commissioned review, it is designed to allow individuals hit by hefty care costs to pass on more of their assets to their children, instead of seeing them wiped out.

I will not go into the nitty-gritty detail of this: the Guardian does that better than I can. Instead I want to highlight the flaw in the proposal. This should have been apparent to anyone. It is that as a proportion of the value of a property £86,000 is small in London and massive in the North-East of England.

Leaving aside for a moment any discussion on whether it is even appropriate that the state should be subsidising the inheritances of those fortunate enough to have parents with houses (and that is questionable), if this is assumed to be the goal imposing what is, in all but name, a flat tax makes no sense at all. In the north-east it is possible that £86,000 could absorb most of the value of a property, most especially when the fact that the care cap is not comprehensive and does not cover personal care is taken into account. In London we may be talking 10% or less of the value of a house.

If this is levelling up it is a very strange way to do it. It penalises the very areas where levelling up was meant to be happening and imposes the highest rate of tax on those with the lowest asset base. This move is, then, deeply regressive and in a way that highlights regional inequality in the UK. It is the exact opposite of what the Red Wall MPs were demanding.

Conspiracy or cock-up? I strongly suspect conspiracy released with the hope that cock-up would distract attention. After all, regressive taxation is at the very heart of the Tory agenda, as their moves on national insurance have already shown. In all but name they are now proposing another deeply regressive tax. I hope their own MPs rebel on this one.