Executive summary of the Autumn budget ’24*

This is a Budget to fix the foundations of the economy and deliver change by protecting working people, fixing the NHS and rebuilding Britain.

In July the government published an audit of public spending. This set out £22 billion of in-year pressures. These pressures were not limited to 2024-25, with the vast majority recurring in future years.

Compensation payments for victims of the Post Office Horizon IT and Infected Blood scandals had also not been fully accounted for. The government is providing compensation to the victims in full averaging £2.3 billion a year over the forecast period.

There has additionally not been a Spending Review since 2021, so departmental budgets have not been systematically re-planned to account for the recent spike in inflation and other factors that have caused significant cost pressures.

Plans set at Spring Budget 2024 were for day-to-day departmental spending to fall from 16.7% of GDP in 2023-24 to 16.0% in 2028-29 and for public sector net investment to fall from 2.5% of GDP in 2023-24 to 1.7% in 2028-29. This was in the context of declining public service performance and GDP per capita lower than at the start of the last Parliament.

The government is taking a different approach. Autumn Budget 2024 is:

  • Putting the public finances on a sustainable path by strengthening the fiscal framework, including announcing new fiscal rules, and taking difficult decisions on tax, welfare and spending.
  • Growing day-to-day departmental spending at an average of 2.0% per year in real terms between 2023-24 and 2029-30 to support public services, including to deliver 40,000 extra elective appointments a week and reduce NHS waiting lists.
  • Boosting capital investment by over £100 billion over the next five years, including in transport, housing and research and development (R&D), with a greater focus on value for money and delivery to help unlock long-term growth.

The Office for Budget Responsibility (OBR) has assessed the impact of the government’s decisions. In the OBR’s Economic and Fiscal Outlook, growth is forecast to increase to 2.0% in 2025 before moderating to 1.6% by 2029.

Public sector net investment averages 2.6 % of GDP over the Parliament. The OBR judges that higher investment will add to GDP during the forecast period, and if sustained will increase the size of the economy in the long term.

* The full autumn budget can be read here

The National Care Forum (NCF) has responded to announcements made in the Chancellor’s Autumn Budget speech today.

Some of the measures impacting social care include:
• A rise in employers’ National Insurance contributions by 1.2 percentage points to 15% alongside a cut to the earnings threshold at which employers start paying these contributions from £9,100 to £5,000.
• New local government grant funding of £600m for social care, alongside an £86m increase to the Disabled Facilities Grant.
• A 6.7% increase to the National Living Wage, taking it to £12.21 for those aged over 21 and £10 for those aged over 18.

Vic Rayner, CEO of National Care Forum commented: “Far from heralding a new dawn for social care, this historic budget appears to do little to recognise the vital role that social care plays in the lives of millions of people up and down the country. Adult social care providers will be hit particularly hard by the government’s planned changes to employers’ National Insurance contributions. Unless fully funded, these increases alongside the welcome raising of the National Living Wage will combine to apply an enormous financial strain and also undermine their ability to focus on the real need to improve care workers’ pay, terms and conditions. “With the apparent commitment of £22.6bn to the NHS compared to the £600m pledged to social care through local government funding it’s clear that the government still has a long way to go in supporting the critical role that care and support plays in the health and wellbeing of local communities. The shift from hospital to community simply will not work without the proper, long-term funding of social care.

“Of the local authorities with responsibility for social services, 70% of their spending is on social care. Even if all the £600m were to be dedicated to meeting the cumulative additional costs that social care employers will now face, it is unlikely to cover the required uplifts. This is before envisaging how hard this will hit people who pay for their own care, in a system desperate for reform.

“The Secretary of State for Health and Social Care has repeatedly spoken about the importance of a properly functioning adult social care system to fixing the NHS. He has also said it is important in its own right in enabling people to live well in the way they want to. We should be investing in this crucial piece of the nation’s infrastructure which improves population health and wellbeing, is inherently preventative, benefits the economy and takes the burden off acute services.

“It seems clear that this Budget will not even provide the desperately needed stabilisation that every report, inquiry and select committee has demanded. Neither, unfortunately, does it reassure that this a government committed to ensuring social care is understood, prioritised and invested in as a public service that changes people’s lives.”

 

About the National Care Forum

The NCF is  the leading association for not-for-profit social care.

NCF brings together more than 170 of the UK’s leading social care organisations, representing large numbers of care providers, offering thousands of services across the country, which are not for profit and always at the heart of community provision. Collectively, these organisations deliver more than £2.3 billion of social care and support to more than 277,000 people. The NCF membership body collectively employs more than 124,000 staff and 14,000 volunteers.
More information is available on the National Care Forum at www.nationalcareforum.org.uk. @NCFCareForum @vicrayner @NCF_Liz

NCF called on the new government to take action to support social care in their “Social care must haves policy document”, published in summer 2024.

BCOP is a member of NCF.