Source: Practice Index, Paula the PM 31.10.24 (Local Practice Manager. Views are my own, and do not reflect those of Practice Index)
I’ve just taken some time, in peace and quiet, to listen to the Budget speech in full. At a time when every penny counts for our primary care, I really needed to know what this would mean for the practice, and my team.
What do I think? I’m pretty irked if I’m honest. On a personal level, I’ll see some tax implications coming down the line, but honestly, I know that those who can afford to pay it need to pay it.
It did feel like a budget of fairness. Carers can work more before they lose their carer’s allowance; some may not be able to, but it means that some of my team may be able to pick up an additional couple of hours a week, which would help me at times, and would certainly give them a little more to spend.
Changes to other things that I think address a balance of fairness, which has felt missing, include:
- Miners’ pension surplus cash to go to them
- Stamp duty changes to help free up properties for first-time buyers
- Redress for the blood scandal and the Post Office scandal
I’m a little hesitant, though, and years of questionable announcements have left me cynical and jaded.
The NHS was mentioned briefly, just before the end. Now, I’m not a believer that funding fixes all things. Quite the opposite, in fact. Throwing cash at a problem rarely fixes it alone, if the problem is chronic rather than acute. But the budget promises to deliver real-terms growth which is music to my ears.
The figure mentioned was £22.6 billion – just for the day-to-day budget. Then £3.1 billion for the capital budget. These are really BIG numbers. However, one of the things that they haven’t said is whether that £22.6bn includes the additional NI costs. I expect it will.
In a big change to Employers’ National Insurance, the rate will rise by 1.2% to 15% in total, which doesn’t seem earth-shattering. It’s not necessarily affordable, but not quite as big as I expected. Until you realise that the threshold at which you start to pay National Insurance is going down, from the current £9,100 per year to £5,000 per year. Which is QUITE a difference – an additional £615 per staff member by my calculations. There is also the increase in rate to think about. Taking a member of staff earning £30,000, we’d be looking at an increase of £615 due to the threshold, plus 1.2% on the balance, which is £250.80. So my total NI increase for that member of staff is just over £850 for the year.
As you can’t claim the Employment Allowance if you’re a public body (presumably as the NI is funded), then we’re looking at quite a big chunk of that being swallowed up by NI increases. So, is it a budget that gives with one hand and takes with the other?
The other big change, which they didn’t make much of today, but which will certainly affect practices, is another hike in the National Minimum Wage. We don’t pay any of our staff at minimum wage, but we do have staff who sit not very far above it, and while I really want to pay them more highly (after all, it’s not that I don’t think they deserve it), the staffing element of the Global Sum is laughable in comparison to the actual costs.
If I think about the members of my team who currently sit just above minimum wage, we’re looking at an increase of 77p per hour on the current minimum. So let’s assume that we will maintain the difference, we’re 77p per hour over a 37.5 hour working week which is £28.88, over the year this is just over £1500. Add the £1500 increase in pay to the increased NI costs which would be £792ish, and we’re looking at a total of about £2300 increase for a minimum wage full time employee. Not only that, but there is increased pension due on the uplift. Overall, our bill will run to tens of thousands of pounds.
As always, the devil is in the detail, and Budget Day is always heavy on top-level announcements but light on what that looks like in practice, and I’m fairly certain that we’re not a million miles away from where we are now. I suspect any increases going forward will be aimed at PCNs rather than practices, though I’m not sure that’s actually what patients want. The position at PCN level isn’t going to be much better. If overall funding doesn’t increase, but pay and NI increase each year, PCNs aren’t going to be able to fund the increases either!
Overall, it’s clear to me that the current figures aren’t affordable. There’s not much I’m going to lose sleep over at the moment, mostly because I think the increase in NHS funding is mostly going to pay for the NI and wage increases. So when the dust settles, I suspect I’m not going to be planning what I can spend the cash on.
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