Exempt all social care providers from the employer NIC increase

We believe the increase in employer National Insurance will put immense pressure on the social care sector, a sector already stretched by funding and staffing issues. We call on the government to review this decision and exempt all social care providers from these added costs.

We think the added NIC expenses would force providers to make difficult choices, leading to wage freezes, cuts in services, even closures. With providers already stretched thin, the impact of this could compromise the quality and availability of care.

Councils may need to cover higher provider fees to ensure services continue, diverting resources. This could create a counterproductive cycle where public funds are funnelled into covering shortfalls instead of building a sustainable care system.

The Government is committing to provide support for the costs that arise from the changes to the employer National Insurance Contributions of ONS defined public sector organisations only.

The Government considered the cost pressures facing adult social care as part of the wider consideration of local government spending within the Spending Review process. This assessment took into account a wide range of factors including changes to National Insurance Contributions and the National Living Wage increases. In response to the range of pressures facing local authorities, the Government is providing a real-terms uplift to core local government spending power of around 3.2% which includes £1.3 billion of new grant funding for 2025-26. Further details will be set out at the provisional Local Government Finance Settlement in December.

Over the next decade, this Government is committed to building consensus on the long-term reform needed to create a National Care Service based on consistent national standards, including engaging cross-party and with people with lived experience of care and unpaid carers. Alongside our 10 Year Plan for health, we will create a long-term plan for adult social care which recognises the importance of social care in its own right, as well as its role to support the NHS.

Reform will not happen overnight; we will make progress in the short term to build the foundations for a National Care Service and support the Government’s Health Mission.

Department of Health and Social Care