We respond to the Autumn Budget

Jim Kane, Community Integrated Care’s Chief Executive Officer, has responded to yesterday’s 2024 Autumn Budget and how this impacts social care:

“The Chancellor’s Autumn Budget will place many adult social care organisations in jeopardy, threatening essential services for thousands of people with care and support needs across the UK.

Whilst increasing taxes aims to strengthen our public services, which of course we welcome, it misses the mark completely on social care – a core pillar of a thriving and supportive society. This lack of attention is either a significant oversight, or an unacceptable underestimation, of the challenges we face. Instead of addressing social care’s needs, the Budget adds an unaffordable strain to an already fragile sector, falling short of the commitments made ahead of its release.

As a charity delivering 10 million hours of vital support each year, and employing 6,000 dedicated colleagues, our initial analysis shows that we now face an eye-watering £12 million (6.2% increase) in unfunded costs. The 1.2% rise in employer National Insurance contributions, and reduction in the secondary threshold, means a £5 million NI increase to our costs, while the 6.7% National Living Wage rise will mean an additional £7 million on our wage bill. This is set against our forecasted surplus for next year of only £2.7 million – a financial pressure that is acute and undeniable.

Let me be clear, as long-standing champions of fair pay for our social care colleagues, we are pleased to see further increases in the National Living Wage – it is the right thing to do and aligns with our charity’s values. However, the lack of necessary funding to support these wage increases means that providers like us will be forced into deficit positions, putting at risk the very services that the 3,500 people we support depend on.

We simply cannot absorb this 6.2% increase in our annual costs without increased funding from Local Authorities. However, it appears that Local Authorities will only receive a real terms increase in spending power of around 3.2% for its services – woefully short of the sum needed to meet the increased costs the Budget has imposed on all care providers.

Urgent action is needed. We hope this outcome is unintended and we urgently call on the Chancellor to review the Budget’s impact on the social care system, especially for charity providers. Local government must be given sufficient resources to increase fee levels in social care contracts to cover the additional costs created by the Budget’s ‘tough choices,’ or social care providers should be exempt from the employer National Insurance increase.”