In a recent statement, Health Secretary Wes Streeting has committed to providing additional support to hospices grappling with the financial implications of rising National Insurance (NI) contributions. This pledge comes amidst growing anxiety within the hospice sector, which has raised alarms that the elevated employer NI contributions introduced in the recent Budget, coupled with soaring wage costs, could result in a staggering financial shortfall of tens of millions of pounds in the upcoming fiscal year.
Hospices play a critical role in offering care free of charge for individuals facing terminal diseases, yet unlike the National Health Service (NHS), they typically receive only a third of their funding from governmental sources. The remainder of their financial support largely relies on charity-driven contributions. During an appearance on BBC Breakfast, Secretary Streeting expressed his intent to revise the government’s grant structure in order to “protect our hospices.” Specific details regarding this initiative are anticipated to be revealed before the Christmas holiday, as he acknowledged the pressing need for hospices to have clarity before making fiscal decisions for the next year.
The urgency of Streeting’s remarks is underscored by the challenges faced by the hospice sector. As articulated by Hospice UK, recent months have marked a significant financial crisis, with the organization describing 2023-2024 as potentially “the worst financial year” in the history of hospice services. The industry representative projected a considerable deficit in the vicinity of £60 million, attributed primarily to escalating staffing expenses. This financial strain has been compounded by the recent announcement from Chancellor Rachel Reeves in her Budget, revealing that from the next April, employer NI contributions would increase from 13.8% to 15%, while simultaneously lowering the payment threshold from £9,100 to £5,000 annually.
Currently, one-fifth of hospices across the United Kingdom have reported service reductions in the last year, coinciding with a spike in demand for their operations. Brad McLean, the chair of East Anglia Children’s Hospice trustees, articulated concerns during a discussion on BBC Radio 4’s Today Programme, highlighting a lack of communication regarding the future of government grants for their services. McLean brought to light the significant advantages hospices provide, stating that they not only contribute to cost savings for the NHS but also offer a highly efficient and holistic approach to care.
Streeting’s recognition of the strain inflicted by increasing NI contributions signals an awareness of the precarious situation hospices find themselves in. He acknowledged the pressing concern that these financial pressures pose and expressed a commitment to address them. As he reflected on the profound impact hospices have had on people experiencing end-of-life challenges, he reiterated the necessity of maintaining robust support systems for these facilities.
Looking forward, Streeting is reviewing the budget allocation for the forthcoming year, aiming to ensure hospices remain supported during these taxing times. He has committed to providing updates before Christmas to enable hospice managers to make informed decisions regarding financial planning. Furthermore, he has articulated a desire for more comprehensive end-of-life care availability, particularly relevant in light of recent discussions surrounding assisted dying legislation introduced this week.
In light of these developments, the Liberal Democrats have voiced their concerns and called for urgent clarification from Streeting regarding the specific measures that will be enacted to protect hospices. NHS spokesperson Helen Morgan emphasized the precarious position many hospices are currently in, arguing that the impending tax hike could drive them toward an unsustainable future. She advocated for the government to heed the warnings of hospice operators and consider exempting these critical care providers from the looming tax increases, a step viewed as essential to safeguarding hospice services.
As we await further details on the proposed support measures for hospices, the situation continues to be of utmost importance, given the role these institutions play in delivering compassionate end-of-life care to countless individuals and families across the United Kingdom.
