Warning tax hikes could force nursing homes to close

The Liberal Democrats are calling on the government to exclude Social Security from national insurance rises.

The party said the chancellor had provided extra funding to the NHS and other public sector organizations to cover the cost of the tax increase, but as the vast majority of health providers are private they would not benefit.

Care England, which represents adult social care providers, said without further support the sector was in “unprecedented danger” and could close services that are no longer viable.

It said the £600m funding was “just a drop in the ocean” compared with the staggering £2.4bn in rising costs associated with wage rises and employers’ National Insurance contributions.

Mike Padgham runs five residential and care homes in North Yorkshire, supporting the elderly and disabled.

He has 210 employees and his current salary is £5.30 per annum. He estimated that the increase in national insurance would cost employers an extra £5,000 a month, while the rise in the minimum wage would add another £25,000.

Most of his residents are funded by the local authority and Mr Padham said he would have to ask for higher fees.

But care providers have long complained that austerity councils are not paying enough to cover the actual cost of care.

Mr Padham, chairman of the Independent Care Group, which represents independent providers, said as a labour-intensive industry, rising staff costs was “the last thing social care needs”.

He said: “For many healthcare providers this will put an existential pressure on them and is likely to drive some out of business unless additional funding is provided to those entrusting care, but there is currently little sign of this. a little.

He said the extra £600m for social care would have “little impact” once it was shared among the 152 local authorities and children’s services.

He added: “Any additional funding that may reach providers will be immediately offset by increases in National Insurance and the minimum wage, which will put further pressure on social care providers.”

Lib Dem leader Sir David Davey said the increase in national insurance “could worsen the crisis in the NHS by raising costs for healthcare providers and pushing some people to the brink”.

He added: “It just goes to show that the government seems to have forgotten about care again.”