Hospice Chief Executive Warns of ‘Hammer Blow’ from Budget Tax Rises

Chris Wheway, chief executive of St Barnabas Hospice in Lincoln, has indicated that service reductions are probable in the wake of this week’s Budget. He described the adjustments to National Insurance and the minimum wage as “very shocking” and “a hammer blow”. Mr. Wheway stated that the hospice, which offers palliative and end-of-life care, anticipates an increase in costs exceeding £1.5 million over the forthcoming five-year period. A government spokesperson commented that “tough decisions” were necessary to provide a £22 billion increase for the NHS and social care within the Budget. The £40 billion in tax increases, announced by Chancellor Rachel Reeves on Wednesday, will largely impact employers, representing the most significant rise in a generation. Employers will see an increase in their National Insurance contributions, and the threshold at which these payments commence has been reduced. Chancellor Reeves explained that these measures are essential to address what she termed a £22 billion “black hole” in the nation’s finances, which she stated were inherited from the Conservatives, and to facilitate investment in the NHS and other public services. Additionally, the statutory minimum wage is set to increase starting in April of next year. While the NHS and the broader public sector are exempt from this tax increase, this exemption does not extend to hospices, despite their provision of NHS services. Mr. Wheway estimated that this would account for £350,000 of the charity’s annual budget, which stands at £13.5 million. He added, “That’s on top of what was already an incredibly challenging funding and budget time for our hospice.” Mr. Wheway stated that it was “inevitable something will have to change” regarding the services the hospice can provide without additional income. He further commented, “I’m sure it’s the same for all charities who will be frantically looking at this and wondering how on earth they will manage it.” In response, a government spokesperson affirmed: “We have taken tough decisions to fix the foundations so a £22bn boost for the NHS and social care could be announced at the Budget.“The employer National Insurance rise doesn’t kick in until April, and we will set out further details on allocation of funding for next year in due course.”