A leading social care organisation has written to the government suggesting measures to ensure the delivery of a fair pay agreement and to reduce the impact of rising National Insurance Contributions (NICs) on the sector.
In a letter to the Chancellor of the Exchequer, the National Care Forum (NCF) has suggested a ‘bridging fund’ to allow social care employers to deliver a fair pay agreement for nurses and other care staff.
The NCF is England’s largest not-for-profit organisation representing social care providers. It has partnered with Methodist Homes (MHA) to propose the bridging fund on behalf of all of its members.
Their call for action comes after the Labour Government pledged a fair pay agreement for those working in adult social care as part of its election campaign.
What does the letter say?
In the letter Liz Jones, NCF policy director, and Sam Monaghan, MHA chief executive, said the fund would make the transition towards a fair pay agreement ‘much smoother for the sector’.
‘It would reassure care professionals that they are recognised, valued and on a trajectory to be rewarded fairly for what they do,’ they said.
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Ms Jones and Ms Monaghan said the fund would be ‘very timely’ given the ongoing Casey Commission into adult social care and the recent Department of Health and Social Care announcement (DHSC) for care professionals to take on more delegated healthcare tasks.
The government launched the independent Casey Commission in January, but said it is unlikely that long-term social care reform will happen before 2028.
‘Without this bridging fund, the sector risks contracting, jeopardising care and support for millions of people, and moving further away from its ability to deliver on the fair pay ambition,’ the letter warned.
How would the fund be administered?
The fund would be a remedial pot of money that would be directly administered to care providers or through local authorities as ring-fenced funding based on the number of employees at each care provider.
It would aim to deliver a smoother transition towards implementing a fair pay agreement for the sector, with the hopes of reassuring care professionals that they are on track to be sufficiently paid for the work they do.
In recent months, the Labour Government has stressed its commitment to delivering its manifesto pledge for a fair pay agreement for those working in adult social care.
It would come as part of a series of regulation-making powers to be introduced under the Employment Rights Bill which is currently at the committee stage of the legislative process in the House of Lords.
What costs would the fund cover?
The NCF wants the funding pot to be ‘at least equivalent’ to the sector’s overall losses following changes to employer’s NICs, announced in the Autumn 2024 budget.
In last October’s budget employer NICs were increased from 13.8% to 15%, with changes expected to start from this month.
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The announcement sparked alarm from hospice and social care providers, with Nursing in Practice hearing of hospices facing additional costs ranging from £200k to £400k a year, following the budget announcement.
Ms Jones from the NCF told Nursing in Practice that the bridging fund ‘offers a solution’ for the government to reduce the impact of NIC rises and to improve the wages of nurses and other social care professionals.
She warned that ‘without action’ hundreds of thousands of people receiving social care support, such as older people and those with learning disabilities, will not be able to access the services they need.
‘It is not too late for the Chancellor to do something to mitigate the impact of increases to and extensions of the employers National Insurance Contributions on the millions of people who draw on care and support,’ she said.
The letter references findings from the Nuffield Trust which calculated that the NIC rises, when combined with National Minimum Wage increases, will cost the 18,000 independent adult social care providers in England a total additional burden of around £2.8bn.
And it warns that the £880m recently allocated in the local government finance settlement will not cover this increased cost, leaving some Local Authorities stretched and offering very low pay uplifts, including as low as 0%.
Last month, the House of Lords voted to approve a proposed amendment to the National Insurance Contributions (Secondary Class 1 Contributions) Bill to ensure specified employers, including social care providers, were exempt from the NIC increases.
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MPs in the Commons later rejected the amendment, with a vote of 307 to 182.
A government spokesperson said: ‘We support our charities through one of the world’s most generous tax regimes for the sector which provided £6bn in relief for the sector last year alone, including exemptions from paying business rates. The difficult but necessary decisions made at the Budget have already delivered an NHS with falling waiting lists and a £3.7 billion rescue package for social care.’
