Concerns in West Sussex to employer National Insurance Contributions

West Sussex councillors have added their voices to those calling for care providers, charities and hospices to be exempt from the coming increase in employer National Insurance contributions.

During a meeting of the full council on Friday (March 21), 46 of the 48 councillors present supported the motion.

The call came two days after MPs voted down amendments from the House of Lords asking to exempt the likes of  NHS GP practices and dentists, and providers of school transport for children with special needs from the increase.

From April, the rate of employer National Insurance contributions will rise from 13.8% to 15%, with the earnings level at which they start paying the tax dropping from £9,100 a year to £5,000 a year.

Mr Wall said the changes, which are due to come into force on April 1 alongside an increase in the National Living Wage, would have ‘a serious and profound impact’.

He added: “The care sector market is indeed vulnerable, and we need to give the strongest possible message to all involved that financial support and exemptions are essential for all of our care providers – those who work hard in the voluntary sector and, of course, the hospices across the county.”

The pressures on care services are already through the roof, with funding topping a long list of concerns such as an increase in demand and problems recruiting and keeping staff.

The council commissions many care services from the third sector so can expect their increased staffing costs to be passed down the line, costing the authority more money.

Mr Wall added: “It is the most vulnerable in society who will likely suffer the most. Those that need our collective support and those we have a duty to protect.”

The National Insurance increases are expected to cost the council around £5.3m in 2025/26. Add that to the increased staffing costs faced by the various charities, care homes and hospices and the figure is huge.

Mr Wall said the council could not pick up the increases ‘and nor should it be expected to do so’.

Bob Lanzer, cabinet member for public health & well-being, said there was ‘real fear, concern and anxiety’ among the voluntary community and social enterprise sector about the impact of the changes, even before they have been put into practice.

He added: “I do fear for what things will look like in one financial year’s time when they’ve been implemented and taken effect.”

Sarah Sharp (Green & Independent Alliance, Chichester South) said the effects of the changes on the elderly and vulnerable could be ‘devastating’.

Describing how the National Insurance increases would leave some care homes facing a rise in staffing costs of as much as £20,000 a month, she added: “It is difficult to imagine that any care homes in the county will remain affordable with these increased costs.”

Mrs Sharp wondered how the council would be able to support the elderly should private care homes collapse under the increased costs.

She added: “It is vital that the government listens and exempts care homes and other similar institutions from this crippling cost.”