Over-65s 'should pay national insurance'

Pensioners should pay more in tax to fund the reform of Britain's crumbling social care system, under plans unveiled following a year-long inquiry ordered by the Government.

Ministers will need to find an extra £25bn a year by 2025 – either through raising taxes or cutting other areas of public spending – to care for Britain's growing elderly population, the Dilnot Commission on the future funding of social care has found.

A specific tax rise aimed at pensioners would be the fairest way to pay for the increase, the Commission concluded, suggesting that this could be done by extending national insurance contributions to over-65s still in employment.

Last night, the Government pointedly refused to give its full endorsement to the Dilnot proposals, which would cap the amount individuals would have to pay for their long-term care at £35,000.

The Treasury is concerned at the cost of implementing plans which, an analysis by The Independent suggests, would rise from £1.7bn to £3.7bn by 2025. This is on top of the further £22bn increase in costs due to Britain's ageing population.

Overall, the total cost of social care – which includes younger adults who need care – would top £40bn.

"In the current public spending environment, we have to consider carefully the additional costs to the taxpayer of the Commission's proposals against other funding priorities," the Health Secretary Andrew Lansley told the House of Commons.

Mr Lansley added that the Government was prepared to include the Labour opposition in discussions on future legislation, in the hope of forging a cross-party consensus on the issue.