The Homecare Association joins over 100 care sector leaders in signing an urgent appeal to the Chancellor of the Exchequer, the Rt Hon Rachel Reeves MP. They warn of potentially devastating impacts from the Autumn Budget on social care services across Britain.
The letter, representing the social care sector in England, which employs 1.59 million people, and contributes £68.1 billion (1) annually to the nation’s economy, highlights that proposed Budget measures could drive up employer costs of at least 9.4% from April 2025. This threatens to exacerbate an existing £8.4 billion funding shortfall in the sector for 2024/25 (2).
The £600 million allocated to Local Authorities falls significantly short of covering these increased costs, which are estimated at £800 per employee according to the Office for Budget Responsibility (OBR). Industry analysis suggests the actual impact could be even higher, exceeding OBR projections by over £1 billion.
The letter calls for either:
- Immediate exemption from national insurance contribution increases for care providers like those granted to the NHS.
- Urgent adjustment to the Local Government Finance settlement to ensure local authorities can increase their fees.
Failure to ensure adequate funding for local authorities and homecare risks a decline in care quality, increased staff turnover, and reduced capacity to meet growing demand. Our recent report on fee rates highlights a stark disconnect between the rising costs of providing care and the fees paid by local authorities and the NHS, potentially leading to a crisis in homecare provision. The Autumn Budget announcements have only further compounded this.
Dr Jane Townson OBE, CEO of the Homecare Association, said:
“The government's rhetoric about ‘home first’ and improving care workers’ conditions rings hollow when only 1% of councils can pay sustainable rates for homecare. We already face a £1.08 billion funding deficit in homecare alone. These additional pressures will make it impossible for many providers to maintain quality services while meeting their statutory obligations.
“We urge the government to exempt homecare providers from the NICs changes and provide proper funding for the minimum wage increase. Without immediate action, we risk the collapse of regulated homecare services in many areas, with devastating consequences for the older and disabled people who rely on them and additional pressure on an already struggling NHS.”
ENDS
Notes to editors
- The Homecare Association is the UK’s membership body for homecare providers, with over 2,200 members nationally. Our mission is to ensure that homecare receives the investment it deserves, so all of us can live well at home and flourish within our communities. The Homecare Association acts as a trusted voice, taking a lead in shaping homecare, in collaboration with partners across the care sector. It also provides hands-on support and practical tools for its members. The Homecare Association’s members agree to abide by the Association’s Code of Practice.
- Local Authorities and the NHS fund 79% of homecare services. Staffing comprises 70-80% of costs of care delivery. Unlike other businesses, care providers cannot increase prices because public bodies dictate these
. - Providers Unite is a grassroots campaign uniting adult care service providers across the country to advocate for meaningful change. Our strength lies in our shared commitment to safeguarding the future of adult care services and ensuring the voices of providers are heard at every level of government.
References
(1) The state of the adult social care sector and workforce in England, 2024
(2) Adult social care funding pressures - The Health Foundation
Contact
Daisy Cooney – Head of Policy, Practice and Innovation
E-mail: [email protected]
Telephone: 020 8661 8160
Mobile: 07435 910654
