The Autumn Budget leaves the social care sector alarmed about the rise in national insurance contributions, says Rachael Dodgson, chief executive of Dimensions.
As the Chief Executive of Dimensions, I am concerned about the impact of Employer National Insurance Contribution (NIC) Increases on the people we support.
We have calculated that the 1.2% increase and the lowering of the threshold will cost Dimensions £5.9m in the first full year of implementation. And the national living wage (NLW) increase will cost us £10.2m. Of course, we welcome our front-line colleagues having more money in their pockets. But, as an employer who already pays 90% of our workforce the real living wage (RLW) or above, this means we will have less to invest in frontline pay above the minimum.
We will also have less to invest in ensuring pay differentials between grades which is vital to retain staff who seek career progression and reward in the same way as other occupations.
The people we support tell us that a good life depends on having consistent, long-term support from people they trust and who have the right set of skills. Without funding that allows us to attract and keep skilled workers, this will be challenging to sustain.
This situation will be replicated across all adult social care providers. The OBR has calculated an average cost of £800 per employee to fund these tax measures. There are 1.59 million care workers in England but only £600m has been assigned in the Local Government Settlement which will not cover the increase in NICs, never mind the NLW increase. Moreover, that £600m is likely to be split between children’s and adult social care. In comparison, the NHS has been allocated £21bn over two years.
It comes at a time when the sector is facing increasing financial pressure from all sides. The Care Quality Commission’s recent State of Health and Social Care report highlighted the vast workforce shortages in the sector, growing inequalities in care provision and poor outcomes for autistic people and people with learning disabilities. It revealed that unmet social care need continues to grow – with the number of new requests that were not provided with a service having risen by 27% since 2017/18.
We will be reliant on an average 2.5% uplift from local government commissioners to pay for the national insurance increases alone. I know commissioners want to do the right thing but doing the right thing will be increasingly challenging for them too.
We were expecting better than this. The new Labour Government introduced the Employment Rights Bill with a fair pay agreement for social care. We thought this recognition for the workforce meant the Government understood the pressure on the sector. This budget does the opposite; it adds to the financial pressure we already face, and the fair pay agreement isn’t likely to be implemented for another two years.
The actions taken in this budget do not match the rhetoric from the Department of Health and Social Care since the election, about the shift to prevention and the need to fix the social care sector.
Sidelining the social care sector has not come out of the blue – it is part of a wider pattern, and decades of chronic underfunding have led us here. However, this level of pressure is simply not sustainable.
The impact on those receiving support should not be understated. The people we support tell us that a good life depends on having consistent, long-term support from people they trust and who have the right set of skills. Without funding that allows us to attract and keep skilled workers, this will be impossible to sustain. For people with learning disabilities and autistic people, this could significantly hinder their ability to live a better life. We are all in this together, whether commissioner or provider, and together we need to push for change.
