GPs ask Streeting for ‘assurances’ over employers’ national insurance hike

Top GPs have called for “urgent assurances” from the Health Secretary that practices will be exempted from the hike in national insurance employer contributions announced in the Budget.

It comes amid warnings that some surgeries will make staff redundant as a result of the change, while some care homes could be forced to close.

Chancellor Rachel Reeves announced the tax hike on Wednesday, with organisations representing care homes and hospices voicing concerns about the sector’s ability to plug the funding gap.

There have also been concerns about the impact on GP surgeries, with one practice manager suggesting it could cost about £40,000 a year.

College chairwoman Professor Kamila Hawthorne said: “We are writing to the Health Secretary today asking for urgent assurances that GP practices will be given the same protection as the rest of the NHS and public sector and receive the necessary funding to cover these additional costs.

“We have very serious concerns about the impact of the increase in national insurance employer contributions on GP practices right across the country, many of whom are already struggling to keep their doors open and make ends meet due to historic chronic underfunding.

“They are working their hardest to provide quality care for their patients against a backdrop of significant budget constraints and staffing challenges – and this added level of insecurity will only compound these pressures.

“For some, this extra financial burden will be the straw that breaks the camel’s back, forcing them to make tough decisions on redundancies or even closing their practice, and ultimately it is our patients who will bear the brunt.”

“During these contract negotiations for our new contract, unless we’re getting given suitable remuneration to cover this national insurance inflation, then we’re going to really struggle,” she said.

“There are going to be practices to start to make redundancies. There are practices that were already considering redundancies because it’s so hard to manage financially, and if we don’t get enough money to continue to run these practices, then we’re not going to be able to provide the service that people want.”

Paul Stanley, a practice manager at Gas House Lane Surgery in Morpeth, Northumberland, also told the programme the changes could cost his surgery about £40,000 a year.

Helen Morgan, health and social care spokeswoman for the Liberal Democrats, said: “We are urging the Chancellor to change course and exempt GPs from a tax hike.

“This new Government must not make the same mistakes as the Conservatives, fixing the GP crisis is crucial for saving the NHS.

“If people can be checked quicker, fewer will end up in hospital for treatment. That’s better for patients, better for the NHS and better for taxpayers.”

Discussing reporting around GPs and the impact of the rise, Downing Street pointed to the “annual GP contract process”.

A No 10 spokeswoman said contracted workers, including GPs, were not eligible for an exemption from the NICs hike, which she said was consistent with the approach of previous governments.

“There is a general process whereby departments, the Department of Health for example, confirm their funding for general practices,” she said.

The spokeswoman added: “I think that’s part of the annual GP contract process. I believe that will take place later in the year.”

A Government spokesperson said: “We have taken tough decisions to fix the foundations so a £22 billion boost for the NHS and social care could be announced at the Budget.

“The employer national insurance rise doesn’t kick in until April, and we will set out further details on allocation of funding for next year in due course.”

Independent Care Group (ICG) chairman Mike Padgham said: “The Government has to do something and it has to do it quickly, as I am already hearing from providers that this might be the last straw for some of them.”

Geoff Butcher, of the Blackadder Corporation, which owns a number of care homes in England, said he believes the rise in national insurance contributions (NICs) for employers could lead to some homes having to shut.

He told the Today programme: “We will certainly not be taking on additional staff. We will be having to cut back on improvement.

“And I know that colleagues in other services are looking at cutting back on staffing, and I think it will exacerbate the speed of closure of homes and the handing back of contracts by other services, including domiciliary (home) care.”

He said the £600 million funding to local authorities for both adult and children’s social care announced in the Budget “if it came through” would equate to about only £350 per employee in the social care sector.

He said: “Staff costs are 80% of our total cost. We’ve got nowhere to go on this.”

He said he finds it “extraordinary that year after year, governments find billions to support the likes of Ukraine, but we don’t find the money to support our very vulnerable people – I think it’s a huge reflection on our society”.

Care England, which represents providers in adult social care, said the national insurance rise, combined with wage rises, will leave the sector with “an additional circa £2.4 billion funding hole to plug”.

On social care, No 10 said: “We are taking action to support the social care sector more generally. There is a real-terms increase in core local government spending power and I think at least £600 million of new grant funding provided to address pressures in the sector.”