Tory proposals to overhaul social care funding are not a “Dementia tax”, a former chancellor has insisted.

Ken Clarke said including the value of an elderly person’s property in the means test for care in their own home was a sensible proposal to tackle the crisis in social care.

Mr Clarke told BBC Radio 4’s The World This Weekend that the alternative of upping taxes for younger people was “grossly unfair”.

“What you can do is actually make sure people don’t sell their houses in their lifetime – if they’re one of the unlucky ones and they’re having to spend a lot on social care, that there’s £100,000 if all else fails that will remain for their children.”

He dismissed suggestions that the proposal was a “Dementia tax”, claiming that it was a “sensible way of organising it”.

The plans, unveiled in the Tory manifesto, mean that thousands more people will have to contribute to the cost of their care, although they will not have to pay during their lifetime.

Ken ClarkeConservative MP Ken Clarke says Tory plans for social care are “sensible”.

A planned £72,000 cap on care costs will be scrapped, but the Government will offer protection from the cost of social care for people with assets of £100,000 or less, a sharp increase on the current £23,250 threshold.

However, more people will be liable to contribute to the cost of being looked after as the value of an elderly person’s property will now be included in the means test for care in their own home.

Mr Clarke said: “The idea that instead of somebody living in a half a million, million pound house, contributing to their own care, younger people of working age who can’t afford to buy a house should actually pay more tax – because that’s what will happen to actually provide the quantity of social care that we need – is grossly unfair.

“This is free market economics with a social conscience, and as a one-nation Tory it’s what I’ve always believed in, but it’s got to be practical, competent, got to have some common sense.”