Parklands Care Homes boss says tax hike may cause ‘severe and lasting damage’ to sector
The boss of the region’s biggest care home business is claiming the increase in employer national insurance contributions will cause “severe and lasting damage” to the sector.
Ron Taylor, the MD at Parklands Care Homes, has written to UK Chancellor Rachel Reeves to express concern at her decision to hike employer contributions by 1.2% to 15%, while also lowering the threshold at which employers start paying national insurance, from £9100 to £5000.
In his letter, Mr Taylor urged the Chancellor to work closely with the Scottish Government to ensure care providers in Scotland receive additional support to help offset the tax hike.
The company runs care homes across the Highlands, including Tain, Fortrose on the Black Isle and Muir of Ord.
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Mr Taylor has also written to Shona Robison, the Scottish Finance Secretary, ahead of next month’s Scottish Budget, to stress the need to ensure that private care providers, who deliver around 80% of care home services in Scotland, are not unfairly disadvantaged.
He said: "The recent increase in employer national insurance contributions adds another financial burden to a care sector that has been grappling with years of underfunding and ever spiralling costs. This is the last thing we needed and is likely to cause severe and lasting damage to the social care sector in Scotland and across the UK.
“We have lost almost 200 care beds in the Highlands alone over the past two years. This Budget will likely accelerate further losses, leaving many older adults without essential support and further straining the NHS.
"We are carefully reviewing the potential impact of these changes on Parklands and exploring ways to mitigate the increased costs. While the financial impact is expected to be substantial, we remain committed to maintaining the high standards of care our residents and their families rely on.”
Mr Taylor added: “I would urge the UK and Scottish governments to work together to support the social care sector, including private operators who form its backbone. Targeted financial support is essential to ensure these providers, who deliver a vital public service to our ageing population, are not left behind.”
A survey published by Scottish Care, the umbrella body for care providers in Scotland, found that 97.83% of respondents said these tax changes make their organisation less sustainable. Nearly half (48%) said there was a very real possibility of service closure as a result of the tax increase.
Dr Donald Macaskill, CEO of Scottish Care, said: “These additional pressures on social care providers created by the UK Budget announcement are unworkable in the current climate and a solution, either through exemption or funding, must be found in order for the social care sector to be sustained.”
Parklands Care Homes operates 12 care homes in the Highlands and North East, employing more than 850 people.
