Sir Keir Starmer on Tuesday backed a wealth tax to pay for social care, as Labour was accused of having no plan to deal with the care crisis.
The Labour leader confirmed his opposition to Boris Johnson’s plan to raise National Insurance contributions by 1.25 percentage points in order to fund reform of adult care and funnel more money into the health service.
He derided it as a “tax rise on young people, supermarket workers and nurses”, arguing that it would ask tenants to pay more instead of rich landlords.
Sir Keir told MPs in the Commons that his party would support taxing wealth: “We do need to ask those with the broadest shoulders to pay more, and that includes asking much more of wealthier people, including in respect of income from stocks, shares, dividends and property.”
The Prime Minister and Chancellor’s plan to raise the dividend tax rate by 1.25 percentage points, another pillar of the Government’s package, amounted only to “tinkering and fiddling”, he claimed.
His intervention came amid growing pressure from trade union chiefs and Andy Burnham, the Labour mayor of Greater Manchester who wields a rival powerbase to Sir Keir, for the party to back a wealth tax or capital gains tax to pay for care reforms.
Labour figures, including shadow care minister Liz Kendall, have repeatedly refused to set out how the opposition party would fund social care reform in recent days, prompting allegations that they are “floundering” on the issue.
On Tuesday, Mr Johnson also dismissed Labour as having “absolutely no plan” to deal with the problem of Britain’s struggling social care system.
Responding to Sir Keir in the House, the Prime Minister said: “What is his answer to the backlogs in the NHS? What is his answer to the problems in social care? The Opposition have absolutely no plan. They have no idea how they would raise the money.”
‘Read my lips: the Tories can never again claim to be the party of low tax’
The Labour leader invoked the experiences of his sister, a “poorly paid care worker”, and insisted he knew the problems beleaguering social care “first hand”.
Accusing the Conservatives of abandoning their core ideology, as well as breaking their manifesto pledge not to raise National Insurance contributions, he told the Prime Minister: “Read my lips: the Tories can never again claim to be the party of low tax.”
The remark harked back to the vow made by George Bush Senior in 1988, when he declared “Read my lips: no new taxes”, before later breaking that promise and then losing the next US presidential election to Bill Clinton.
Mr Johnson hit back, taunting Sir Keir that the Conservatives were now the “party of the NHS”, a claim previously made by successive Labour leaderships.
Ms Kendall has previously insisted Labour will set out costed proposals for care reform in its next manifesto. She has outlined a 10-point plan, calling for people to be given more help to receive care while living at home, better pay and training for health staff, and more integration of care and the NHS.
Labour originally increased National Insurance contributions to raise money for the health service in 2002, while Tony Blair was prime minister and Gordon Brown the chancellor.
Mr Brown said the increase, from 10 per cent to 11 per cent for employees, would help “put the NHS on a sustainable foundation for the long term”.
The rate rose again, by another percentage point, in 2011 under the Tory-Lib Dem coalition government. However, it had first been announced a year earlier by Alistair Darling, chancellor under Mr Brown’s administration, as part of a plan to reduce borrowing.