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Care Providers To Rally At Westminster, Urging Government To Address Critical £2 Bn Funding Gap

Care providers across the UK are set to gather at Westminster on February 25 to call on the Government to urgently address a £2 billion funding shortfall that threatens the future of adult social care following the Autumn Budget.

In an unprecedented show of unity, nearly 3,000 care professionals, organisations, and charities have come together under the banner of Providers Unite, highlighting the dire financial pressures facing the sector. The group warns that rising costs, particularly due to increased National Insurance Contributions (NICs) and the minimum wage hike, could force one in five care providers to close, leaving vulnerable individuals without essential support.

A collective letter, signed by thousands of care professionals and sent to the Chancellor in November, urged the Government to reconsider policies that are exacerbating the crisis in social care. However, after receiving no meaningful response, the sector is now preparing to make its voice heard through a public demonstration outside Parliament on 25th February.

According to their own analysis the real impact for Employers is underestimated, potentially exceeding projections by over £2 billion due to the combination of:

  • A significant 1.2 percentage point increase in Employers’ National Insurance contributions, bringing the rate to 15%.
  • The earnings threshold for these contributions will be lowered from £9,100 to £5,000, further intensifying the financial strain on employers.
  • A 6.7% increase to the National Living Wage, taking it to £12.21 for those aged over 21 and £10 for those aged over 18.
  • These wage increases will significantly raise operating expenses for providers, where staffing costs already account for over 70% of total expenses.

These changes are forcing many care homes to make difficult decisions, including reducing services, handing back contracts to local authorities, or considering closure altogether. A recent survey of care organisations supporting over 128,000 people in England revealed the extent of the pressure, with many providers struggling to remain financially viable.

 Providers Unite is demanding that the Government either exempt the social care sector from the NICs increase, as was done for the NHS, or introduce emergency funding measures to bridge the growing financial gap. Without intervention, many providers warn that essential services will disappear, leaving some of the most vulnerable members of society without the care they rely on.

Nadra Ahmed, Chair of the National Care Association and a key figure in Providers Unite, expressed deep concern over the situation: “Social care providers have long been investing in and innovating to keep services running, but these latest financial pressures are a step too far. Without urgent Government support, we face the devastating loss of vital care services across the country. This protest is a clear message that the sector has had enough—we need action now.”

Shadow Health and Social Care Secretary Ed Argar criticised the Government’s approach, stating:
“The rise in employer NICs has been a disaster for social care providers, hospices, GPs, and many others. Despite promises of support, this tax hike will blow holes in providers’ finances, leading to higher costs, job cuts, and reduced services. Ultimately, it is the most vulnerable who will pay the price. The Government must urgently set out how it will protect them.”

A spokesperson for the Department of Health and Social Care stated:
“We are committed to supporting the social care sector and are providing significant funding to local authorities to ensure vital services continue. This includes additional investments to support disabled individuals and increasing carers’ allowances.”