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National Insurance rise ‘will raise £36bn in three years’ for NHS and social care


funding


National Insurance (NI) contributions will rise by 1.25% from next April to tackle the NHS backlog and pay for the social care system, Prime Minister Boris Johnson has today announced.

Announcing the increase, Mr Johnson said the levy would raise almost £36bn for frontline services in the next three years.

The majority from the tax increases in the first three years will be spent on improving the NHS waiting list, which is currently at 5.5m people, while a growing proportion will go to social care.

He added there were ‘30,000 patients occupying patients that could have better cared for elsewhere’ when the Covid-19 pandemic hit last year, which was ‘costing billions every night’.

The changes will come into effect from April 2022.          

As part of the reforms, anyone who has assets of less than £20k will also have their care costs fully covered by the state, while those with assets between £20k and £100k will receive some means-tested state support.

Meanwhile, working pensioners – estimated at around 1.2m people – will also be asked to pay NI contributions for the first time.

Health services in Scotland, Wales and Northern Ireland would receive an extra £2.2bn a year, the Government said.

The announcement revealed that social care plan will mean no one in England will have to pay more than £86k for care over their lifetime. 

Mr Johnson said: ‘I accept this breaks a manifesto commitment. It is not something I do lightly, but a global pandemic wasn’t in anyone’s manifesto.’

However, Labour leader Sir Keir Starmer said the plan was ‘a sticking plaster over gaping wounds’, claiming many of the problems in social care had existed before the coronavirus pandemic.

It comes as the Government yesterday announced a £5.4bn funding injection for the NHS over the next six months to ‘support the Covid response’, including an extra £1bn to tackle the care backlog.

Meanwhile, the BMA had called for ‘at least’ £4.9bn to tackle the non-Covid care backlog; £6.5bn capital funding to cover overdue maintenance costs; at least £4.2bn capital funding for wholesale digital transformation; and £1bn capital funding for GP premises.

A version of this article was first published by Pulse’s sister title Nursing in Practice

READERS' COMMENTS [6]

Richard Greenway 7 September, 2021 9:05 pm

Is this going to be 1.25% on both employers AND employees National Insurance i.e. 2.5%?
If so this will be a “master stroke” of recycling funds. The total NHS and Care Sector employers NI bills will run into billions of recouped extra investment …….lets hope I’m wrong.

Sam Macphie 8 September, 2021 12:06 am

PM ‘Winston Churchill’ Johnson and his henchmen either side, Javid and Sunak, in the Commons today; opposite those we have Sir Starmer with his “sticking plaster” accusation. He could be right. Also, I’m thinking isn’t it time for all MPs to have shorter holidays: it is overdue. Why do they need school teacher and children length holidays in times of national crises: such as Afghanistan and Taliban, Isis-K, British soldiers and pilots trying to evacuate innocents and Afghan civilian lives at risk; Brexit, HGV drivers and impending shops, meds shortages, flu delays and so on; Covid deaths; climate change and more. There were COBRA meeting: did we ever get to hear their decisions on these crisis matters? Why not?
All MPs need to be accountable, not on comfy holiday in Crete; they need to be in Parliament, visible and being interviewed by the media where necessary, not on schoolchild summer holidays.

Michael Mullineux 8 September, 2021 7:17 am

Another real terms partners pay cut to join this years unfunded suggested staff increase

Chris GP 8 September, 2021 12:07 pm

“Is this going to be 1.25% on both employers AND employees National Insurance i.e. 2.5%?
If so this will be a “master stroke” of recycling funds. The total NHS and Care Sector employers NI bills will run into billions of recouped extra investment …….lets hope I’m wrong.”

You are not wrong – rough calculation – it is a £30million cost to core primary care non GP staffing straight off the bat. That is before you get in to PCN staff / salaried GP’s OOH and the like. The secondary care NI increase will be just over half a billion. Additionally there will be an increase in inheritance tax take presumably? If estate value is not being used to pay for care – a good % will end up with the treasury after death.

Chris GP 8 September, 2021 2:13 pm

Forgot to add in ers NI to 2ndry care costs – it will be just over £1 billion

Chris GP 8 September, 2021 2:16 pm

…oh lord – no – it is half a billion. Wish it was possible to delete posts!