News » Political News » Increased employer contributions headline the budget for GPs
October 31st 2024
GPs have raised concerns about increased employer costs announced in yesterday’s first budget by Labour Chancellor Rachel Reeves.
In the budget, Reeves announced a 6.7 per cent increase in the National Living Wage (NLW) alongside a 1.2 per cent rise in Employer National Insurance contributions and a cut to the earnings level at which employers start paying the charge (secondary threshold) to £5,000.
According to Deloitte, for an employee on UK average earnings of £36,036, the combined effect of the two measures will be an increase of 25 per cent in employer contributions from £3,715 for 2024-25 to £4,655 for 2025-26.
The change will have a higher impact for employers in low-wage sectors such as hospitality, retail, leisure or care. For example, for an employee earning £20,000 pa, employer contributions will increase by 50 per cent from £1,504 for 2024-25 to £2,250 for 2025-26.
Other measures in the budget include £22.6 billion for the NHS, with an additional £3.1 billion for capital projects. According to the chancellor, this provides a two-year average real-terms growth rate for NHS England of 4.0 per cent, the highest since before 2010 excluding COVID-19 years.
For GPs there will be a dedicated fund to deliver around 200 premises upgrades.
