Now Reeves faces backlash from GPs, care homes and hospices over national insurance hike

While the NHS and the rest of the public sector has been shielded from the chancellor’s rise in employer contributions to National Insurance, GPs and the care sector warn they will face severe strain

Rachel Reeves is facing a growing backlash over her national insurance hike as GPs, care homes and hospices have called for an exemption from the charge.

The chancellor is piling pressure on GPs and the care sector with her increase in the employer rate of national insurance – at a time when the services are already under severe strain.

But while the NHS and the rest of the public sector have been shielded from Ms Reeves’ national insurance hike, GPs, hospices and care homes have been left to bear the brunt. The national insurance hike came alongside a reduction in the threshold at which employers pay the charge and a 6.7 increase in the minimum wage, exacerbating the headache for employers.

Health secretary Wes Streeting has said the UK’s palliative care is in such a dire state that he would not vote to support an assisted dying law, while the Commons public accounts committee has said the social care sector is “on its knees”.

Meanwhile GPs are struggling with a recruitment crisis, with staff shortages growing at a time of rising demand.

Treasury chief secretary Darren Jones on Friday cleared up initial confusion and confirmed that GP practices will have to pay the increased employer national insurance rate.

“GP practices are privately owned partnerships. They’re not part of the public sector National Health Service system. And so yes, they will have to pay national insurance contributions as employers,” he told Times Radio.

The Liberal Democrats said Labour had squandered the chance to “rescue GP surgeries from years of neglect”, calling for Ms Reeves to exempt them from the tax hike.

Health and social care spokesperson Helen Morgan said: “This new government must not make the same mistakes as the Conservatives, fixing the GP crisis is crucial for saving the NHS.

Wes Streeting has said he will have ‘more to say’ on the impact of the tax hike in the coming weeks (Lucy North/PA Wire)

"If people can be checked quicker, fewer will end up in hospital for treatment. That’s better for patients, better for the NHS and better for taxpayers.”

Meanwhile GP and British Medical Association deputy chairman Dr David Wrigley said the impact of the Budget on GP surgeries would be “monumental”. “Many are already on a financial tightrope due to years of neglect. We need a rapid announcement of full reimbursement,” he added.

Meanwhile Mike Padgham, chair of the Independent Care Group, said he was “dismayed” at the chancellor’s decision to pass the increased tax rate onto the already struggling sector.

Responding to Ms Reeves’ decision, he welcomed a funding boost for the sector, but said: “Any extra funding that might reach providers will be wiped off instantly by the increases in national insurance and minimum pay which will together heap further pressure on social care providers.

“For some they may well be the final straw.”

Lobby group Hospices UK said those providing NHS services should get the same treatment as bodies inside the NHS.

It said: “Paying brilliant, compassionate hospice staff a fair salary makes up the biggest proportion of running costs, and so it’s disappointing the chancellor didn’t exempt charities, or providers of NHS services which aren’t formally part of the NHS, from Wednesday’s national insurance rise.”

Asked about the row over GPs on Friday, Mr Jones said: “Many GP practices are small organisations, and so they will pay less than some of the bigger businesses that we’re asking to contribute more at this Budget.”

And health secretary Wes Streeting has said he is “working through” which healthcare providers are going to be hit by the employer national insurance hike.

He told the BBC’s World at One programme: “I’ll have more to say on that in the coming weeks in terms of what we can do more quickly to deliver the shift I’ve wanted to see for some time, in the focus of NHS investment spending out of hospitals into primary community."