Liberal Democrats call for primary care providers to be exempt from NI increase

Primary care providers should be exempt from the National Insurance (NI) increase laid out in the autumn Budget, Liberal Democrat health and social care spokesperson, Helen Morgan MP, has said.

Writing to Chancellor Rachel Reeves on Tuesday (12 November), Morgan emphasised that the increase would “severely impact health and care services for patients.”

The Liberal Democrats “fear it will make the crisis in our NHS and social care sector even worse,” Morgan said.

GP surgeries, social care providers, hospices, NHS dentists, pharmacies and “charitable providers of healthcare” should be exempt from the increase, Morgan wrote.

An increase in employer NI contributions from 13.8% to 15% was announced in the 31 October Budget.

A reduction in the threshold when NI contributions must be paid, from £9,100 to £5,000, was also outlined.

Whilst acknowledging the challenges that the government faces and welcoming the £22.6 billion NHS ‘down payment’ announced in the Budget, Morgan emphasised that “subjecting health services such as GPs and care homes to higher taxes is completely counterproductive.”

“You are giving to the NHS with one hand but taking away with the other,” she added.

Morgan noted that many health and care providers are not eligible for the Employment Allowance, and that an NI increase could mean services and staff headcounts being cut.

“That would be a disaster, not just for patients but for the NHS too,” Morgan said, adding that there is a shortage of GPs and a “desperate need” for increased capacity in the care sector.

She went on to call primary care providers “the backbone of our health services,” adding that without them NHS hospitals risk being overwhelmed.

The health and care crisis would worsen if the NI increase was rolled out to primary healthcare services, Morgan said.

The letter, which Morgan posted on X, was signed by 64 of the Liberal Democrat’s 72 MPs, as well as Lord Scriven and Baroness Tyler of Enfield, both Liberal Democrat Peers in the House of Lords.

The AOP has welcomed Morgan’s call, whilst emphasising that optometry is also an important pillar of primary care.  

Dr Peter Hampson, Clinical and policy director at the AOP, said: “The implications of the autumn Budget are potentially far-reaching for businesses in the eye care sector. Business owners are telling us that they could be forced to make tough decisions to cut costs in order to accommodate and survive these latest changes to business tax.  

“We welcome the Government's ambitions for the NHS – to shift care from hospitals into the community and cut waiting lists. Our concern is that these increased pressures on primary care services have a real risk of damaging the delivery of healthcare in the community.  

“This is why we fully support calls to the Government to make primary care, including optometrists and our colleagues across general practice, pharmacy and dentistry, absolutely exempt from the increase in NI contributions.”    

Responding to the Budget, the AOP previously noted that an NI increase would be an “unwelcome cost pressure” for many optometry practices. 

The extra cost will increase the cost of performing NHS sight tests, the association added.

The NI increase was also raised at Prime Minister’s Questions on Wednesday (13 November) by opposition leader Kemi Badenoch.