Autumn Budget Announcement - Surrey and Sussex LMCS

This picutre shows a calculator and a pen, and in the background an accounts sheet.

We writing following a number of queries from colleagues to the LMC regarding the implications for GP practices following the 2024 Budget.

The minimum wage for over 21-year-olds (known as the National Living Wage) will rise from £11.44 to £12.21 an hour (an increase of 6.7%).

For 18–20-year-olds, the minimum wage (also known as the National Minimum Wage), will rise from £8.60 to £10.00 per hour (an increase of 16.3%).

These changes form part of the Government’s intention of having a single such rate for all adults.

There is no change in employee National Insurance rates, but employer’s costs will rise, because:

Employer NI rates will rise by 1.2% from 13.8% to 15%.

The threshold at which NI is deducted is being reduced from £9500 annually, to £5000.

Although the Employment Allowance has been adjusted to mitigate the impact of these changes, GP practices, whose work is predominantly within the NHS public sector, are not eligible to claim this allowance.

Clearly these changes have a significant potential financial impact on practices; the budget also announced a substantial uplift to the NHS budget overall. GPC England has already raised to both NHS England and the DHSC the serious risks for all General Practices at these increased costs. This financial challenge would also include the cost of maintaining salary differentials amongst employees.

Obviously the Budget involved significant further changes, and the BMA has published this update for all colleagues: Autumn Budget 2024: BMA member briefing.

We appreciate this creates uncertainty for GP partnerships, but as soon as an update is available, I will circulate this to all colleagues.

 Dr Julius Parker ,Chief Executive

Update: NI and other changes

We are writing to update all colleagues regarding the BMA’s response to the employers’ National Insurance contribution rate, and other changes announced in the October 2024 budget, and also to request practices respond in two ways:

To download and complete the recently available BMA NI calculator (this is no longer available).

This requires a BMA login to access this, please assist the most suitable member of the practice team in being able to do so.

To contact your local MP. A template letter is available on the BMA website.

It is far more likely MPs will respond to letters that include personalised commentary, so the details of, in broad terms:

The number of staff your practice employs
The approximate financial impact these changes will have
Any changes you are likely to have to consider: these may include making staff redundant, not recruiting new staff or reducing services dependent on such staffing decisions.

Colleagues will have already seen the widespread publicity that is already being generated by these concerns, in terms of, for example, their impact on hospices, care homes, and more widely in the hospitality and retail sectors, as the financial impact is greatest for employers with a disproportionate number of comparatively lower paid employees. This also accentuates the impact of increases in the National Minimum and Living Wage which will also take effect in April 2025.

GPC England and the BMA have already contacted DHSC and other political leaders urging for a change in the way General Practice is treated by these changes. I appreciate that as employers you can only make decisions based on your knowledge now, a point that could be included in any letter to an MP, since these HR decisions require a lead-in time, but every effort is being made to mitigate the effect of these changes on General Practice.

As some colleagues will know, it is the England LMC Conference on 22nd November and hopefully more information will be available by then.

Dr Julius Parker, Chief Executive