GP practice costs will increase by £180-200m nationally as a result of tax changes coming into force in April, the BMA has estimated.
Serious concerns were raised last year that following the Budget announcement of the rate of employer National Insurance Contributions (NICs) increasing to 15%, as well as the National Living Wage (NLW) rising to £12.21 an hour, practices will have to pay thousands more from April.
As a result, the BMA’s GP committee invited practices to increase the collective actions they are taking to ‘turn up the pressure’ on Government and created a calculator to help practices estimate the impact.
Yesterday, GP committee chair Dr Katie Bramall-Stainer said that the changes are expected to cost practices nationally around £280m. However she later said she misspoke and the BMA has confirmed that the real estimation, based on a BMA survey, is between £180-200m.
Despite this, she said that practices will still see a funding uplift for 2025/26, since the Government announced a £889m uplift for 2025/26, although this did not explicitly mentioned the tax hikes.
During a rally on GP employment yesterday, Dr Bramall-Stainer said: ‘Wes Streeting announced on 20 December that the financial envelope for 2025/26 was going to be £889m.
‘Now, to put that into context, the uplift the year before announced by the Government was £172m.
‘We’ve estimated the business cost pressures of the Employers’ National Insurance Contributions and the National Living Wage to be in the region of about £280m.
‘So depending upon where and how that headline figure is invested – making sure as much as possible goes into the Global Sum, as little as possible goes into the PCN DES, as much as possible is going to be going into core contract work, that’s easy to achieve and can be transparently funded through – then there is going to be an uplift in 2025/26.’
The GPC had outlined demands to end collective action earlier this year, before the Budget and its implications, including GP practice core funding to rise by at least £40 per patient for 2025/26, which would mean an uplift of around £2.5bn.
But Dr Bramall-Stainer said that the final uplift is unlikely be in line with this demand.
Dr Bramall-Stainer added: ‘Is it the £40 per patient that we’ve said is required, that extra £2.5bn? No, it’s not, but it’s certainly a positive step on the road to recovery, and we’ve been very pragmatic.
‘We know that that’s got to increase bit by bit. It’s not going to all happen in one go.’
At the same rally, Dr Bramall-Stainer also revealed that the BMA is pushing the Government to agree to a ‘full reimbursement mechanism’ for salaried GPs as part of a new contract, as per the old Red Book GMS contract.
Last year Pulse exclusively revealed that the changes could cost GP practices across England a total of £260m.
The Budget fallout in brief
Since the chancellor’s announcement during the Budget at the end of October, the Treasury confirmed that funding has been set aside to protect the spending power of the public sector, including the NHS, from the direct impacts of these changes.
But GPs have been excluded from this, as the funding to offset the increased NICs costs does not include support for the private sector, including ‘private sector firms contracted out’ – with GPs generally operating as independent businesses for this purpose according to the Treasury.
The BMA have demanded the Government reimburse practices for increased NICs and asked GP partners to write to their MP demanding a U-turn from the Government.
Alongside tax hikes, the chancellor also announced public spending increases with an additional £22.6bn going towards day-to-day health spending, and £100m ‘earmarked’ for GP estates upgrades.
For Pulse’s analysis of the budget, read: A Budget seemingly designed to punish GPs
Note: This article was updated at 16.57 on Thursday 13 February to reflect the inaccurate figure initially provided by the BMA, which it later updated to £180-200m.
BMA leaders repeatedly argue for healthcare to be paid from general taxation, and for that taxation to be increased to fund increased spending – despite the evidence that this does little for productivity.
But somehow the same people argue that despite earning multiples of median wage, that they should be exempt from paying the extra tax. Well, duh, it doesn’t work like that.
DH duh, compare doctor/patient ratios in other OECD countries.
BTW Dave, what is your GMC no? If you don’t have one foxtrot oscar.