by The Chancellor’s budget raid could cost a GP practice the equivalent of five nurses’ salaries, according to estimates.
Surgeries, care homes and hospices are among those calling for an exemption from the rise in National Insurance, saying the extra tax on employers could force some to close.
The Government had said that the public sector would be exempt from the increase.
However, on Thursday night, Darren Jones, the Minister for the Treasury, said that DG practices were “not part of the public sector” and would face additional costs.
Dr Richard West, chairman of the Society of General Practitioners, has written to the Health Secretary, warning that such a rise, combined with the rise in the National Living Wage, could force surgeries to close shop .
Dr West, whose practice serves 16,000 patients in rural Suffolk, said: “Our accountants have calculated that the practice will incur additional costs of £140,000 from next April. This includes the costs associated with the increase in employers’ NICs and the Living Wage. This represents a number of senior clinical staff.”
The figure is almost as much as the combined starting salary of five nurses, who earn £29,969.
Dr West said: “The increased costs associated with the Budget will have to be met by reducing patient services and/or making staff redundant.”
Before the election the Health Secretary promised to transfer billions in NHS funding to GPs, saying this would “fix the front door for the NHS”.
He said: “It’s at the heart of the crisis in the NHS because, if we don’t fix the front door to the NHS in general practice, we’re not going to get the rest of the system to work.”
In his letter to Mr Streeting, Dr West said: “General practice is the front door of the NHS. The rise in NICs and the Employer Living Wage could close many of those doors for good.”
Under the changes announced by Rachel Reeves, employer contributions will increase by 1.2 percentage points to 15 per cent from April and businesses will have to start paying staff who earn more than £5,000 a year, instead of £9,100.
The changes would also affect dentists and pharmacists.
The Independent Pharmacists Association said the Budget was a “wrecking ball” for community pharmacies, saying it would cost the sector £1.25 billion and put many out of business.
Dr David Wrigley, GP and vice-chairman of the British Medical Association (BMA), said the impact of the tax increase would be “monumental”.
He wrote on X: “Make no mistake. The increased NI/lower salary threshold will have a significant impact on NHS GP surgeries across the country. Many of them are already financially strapped for years [sic] of negligence. We require prompt notification of a full refund.”
Neil O Brien, the former health minister, said it would be “absolutely unfair” not to reimburse all GPs.
Credit: BBC Quiz
Dr Jess Harvey, a GP based in Shropshire, told BBC Radio 4’s Today program that practices are “really going to struggle”.
“During these contract negotiations for our new contract, unless we are given suitable remuneration to cover this National Insurance inflation, we will struggle a lot,” she said.
“There will be practices that will start to make redundancies. There are practices that have already considered redundancies because it is so difficult to manage finances, and if we don’t get enough money to continue running these practices, we won’t be able to provide the service that people need provision.”
Asked whether GP pay should be “hit” to cover costs, Dr Harvey said: “How general practice is funded, this is not about GPs, this is not about my pay. I don’t want an increase in my salary.”
‘GPs exempt from tax increase’
Helen Morgan, the Liberal Democrats’ health and social care spokeswoman, said: “We are urging the Chancellor to change course and exempt GPs from a tax increase,” she said.
“This new Government must not make the same mistakes as the Conservatives, the GP crisis is vital to saving the NHS.
“If people can be checked more quickly, fewer people will go to hospital for treatment. That’s better for patients, better for the NHS and better for taxpayers.”
The British Medical Association said on Thursday that health ministers were “locked in discussions with the Treasury” over the issue.
Dr Katie Bramall-Stainer, chair of the BMA’s GP committee, said she had held talks with Stephen Kinnock, the health minister, while Phil Banfield, chairman of the BMA Council, had also spoken to Wes Streeting, the Health Secretary.
She argued that NHS GP practices count “as public sector”, citing the Freedom of Information Act 2000 which defines them as “public sector authorities”.
Downing Street suggested on Friday that GPs could receive extra funding, given the rise in National Insurance, as part of their contract.
Negotiations on the deal are due to begin within weeks.
Terms are negotiated annually but were imposed this year, and many GPs are currently taking part in “work by rule” protests against their current contract, which has boosted funding by 7.4 per cent.
Spokesperson No. 10 that contract workers, including GPs, were not eligible for exemption from the NICs increase, which she said was in line with the approach of previous governments.
“There is a general process through which departments, the Department of Health for example, confirm their funding for general practices,” she said.
The spokesman added: “I think that’s part of the annual GP contract process. I believe that will happen later in the year.”
The Royal College of GPs said it has contacted Wes Streeting, seeking assurances that practices like “the rest of the NHS and the public sector” will be protected.
Professor Kamila Hawthorne, chair of the College, said: “We are writing to the Health Secretary today asking for urgent assurances that GP practices will be given the same protection and funding as the rest of the NHS and public sector. necessary to cover these. expenses.
“We have very serious concerns about the impact the increase in employer National Insurance contributions will have on GP practices across the country, many of which are already struggling to keep their doors open and make ends meet due to chronic historical underfunding.
“They are working hard to provide quality care to their patients against the backdrop of significant budget constraints and staffing challenges – and this added level of insecurity will only add to those pressures.
“For some, this additional financial burden is the straw that breaks the camel’s back, forcing them to make tough decisions about redundancies or even closing their practice, and ultimately our -patient who will bear the pressure.”
Ruth Rankine, director of primary care at the NHS Confederation, said: “Our members across primary care will be very concerned if the increase in the employer’s National Insurance contribution has to come out of their core budgets.
“GP surgeries can operate as independently owned partnerships but they are fully funded to provide NHS services and therefore should be given the same support as NHS trusts and other public sector organisations.
“As primary care providers have already not been given additional funding to cover the full cost of recent wage awards, while having to pay higher cost of living allowances and minimum wage increases, the This development created a perfect storm in which he could. some practices have no choice but to end or cut back on their services because they cannot afford to keep them running.
“Already, there are over 200 fewer general practices open in England than there were two years ago at a time when the population continues to grow and people with more complex healthcare needs.”
