Budget – no clear support for Adult Social Care
Key items in the budget today
We bring you key elements relevant to our sector announced in Chancellor Rachel Reeves budget.
Disappointingly there was very little tangibly linked to supporting the social care sector, other than the previously agreed and committed £600 million which is not new or extra money. This does not go far enough for our sector.
The Budget in short
Budget announcements that were made that affect our sector included:
- A 22.6bn increase in the ‘day-to-day’ health budget
Increase in National Insurance contributions from employers- Confirmation of national minimum wage rates
- Government will ‘increase funding significantly’ for local governments next year
- Health and disabilities system to be ‘updated’
- Bus fare cap to rise to £3 confirmed
- Spending on the state pension will rise to 4.1% in 2025-26
- The appointment of a Covid corruption commissioner was announced
- The Budget will increase the Affordable Homes Programme to £3.1b
No additional funding: despite numerous reports highlighting a system needing support
Whilst SCA welcome the additional financial support of £22.6 billion committed to our NHS colleagues and funding to local governments in 2025 it really is becoming increasingly critical that the government need to prioritise adequate funding for our sector. Even in the last two weeks there have been a number of reports, analysis and debate from both government, The Lords and influential bodies highlighting drastic need for change in the social care system.
In September, Lord Darzi also released his independent report commissioned by the government finding a: ‘social care system far from supporting the scale of need.’ And with the Institute for Fiscal Studies (IFS) analysis of the adult social care sector highlighting: ‘unresolved’ issues in social care funding and reform just last week, the same sentiment was also concluded at the recent House of Lords debate this month.
What is new?
Below is a more detailed run-down of confirmed budget commitments and the new elements that Chancellor Rachael Reeves speech has just revealed:
NHS – The Chancellor announced that new funding for the NHS was part of the 10-year plan to address the health system to be released in the spring.
Welfare – the Budget referenced welfare spending and that the: ‘health and disabilities system is to be updated,’ – this was mostly focused on ‘welfare fraud.’
Tax – National Insurance – employers The Chancellor announced that National Insurance contributions by employers will rise from 13.8% to 15%. The Chancellor also said that she would be increasing employment allowance to help smaller businesses. The employment allowance will increase from £5,000 to £10,500, which the chancellor says will mean 865,000 employers won’t pay any National Insurance at all next year.
Personal Income Tax / NI thresholds – by 2028-29, personal tax thresholds will be uprated in line with inflation
Fuel Duty – 5p cut in fuel duty on petrol and diesel will be kept for another year
Affordable Housing – government will increase the Affordable Homes Programme to £3.1bn
Please do reach out to the SCA Team should you need to, and we will continue working to lobby on your behalf on the economic impact of these decisions.