Lincoln care home boss says budget tax rise is ‘hammer blow’

A hospice chief has warned that cuts to services are likely to come after this week’s Budget.

Chris Wheway, from St Barnabas Hospice in Lincoln, said the changes to National Insurance and the minimum wage were “very shocking” and “a blow”.

The hospice, which provides palliative and end-of-life care, will face increased costs of more than £1.5 million over the next five years, he said.

A government spokesman said “difficult decisions” had to be made to deliver a £22bn boost to the NHS and social care in the budget.

Employers will bear the brunt of the £40bn tax rises Chancellor Rachel Reeves announced on Wednesday; This is the largest increase in a generation.

National Insurance costs will rise and the threshold at which they start paying has been lowered.

Reeves said the measures were needed to plug what he described as a £22bn “black hole” in the country’s finances inherited from the Conservatives and to invest in the NHS and other public services.

The legal minimum wage will also increase from April next year.

The NHS and the rest of the public sector are exempt from the tax increase, but this does not include care homes that provide NHS services.

Mr Wheway said this would cost an estimated £350,000 of the charity’s £13.5 million annual budget.

“This is on top of an already incredibly challenging funding and budget period for our nursing home,” he said.

Mr Wheway said “something is bound to change” in what the hospice can offer without extra income.

“I’m sure it’s the same for all the charities out there who are frantically looking at this and wondering how they’re going to achieve this.”

In response, a government spokesman said: “We have taken tough decisions to repair the foundations so that £22bn of support for the NHS and social care can be announced in the Budget.

“The Employer National Insurance increase will not start until April and we will announce further details of the funding allocation for next year in due course.”