The Hidden Cost of Caring: What the National Insurance Rise Means for Local Charities

As a charity dedicated to supporting families in the Chichester area, we are deeply

concerned about the recent government announcement to raise National Insurance contributions. While this change is aimed at boosting public funding for key services, it will also have a significant and largely overlooked, impact on the charity sector.

A Tighter Squeeze on Charities

For many local charities like ours, every penny counts. We operate on tight budgets, relying on a mix of fundraising, grants and community goodwill to keep vital services running. A rise in National Insurance contributions increases employment costs at a time when many of us are already stretched.

This means:

● Increased Payroll Costs: For charities with paid staff, the rise in employer National Insurance contributions directly increases the cost of employing people. For small organisations, this could limit our ability to recruit or retain staff and to provide frontline services in line with current levels of delivery. At PACSO the changes to minimum wage and National Insurance contributions are expected to cost us an extra £26,000 this year!

● Volunteer Challenges: While volunteers are the lifeblood of many charities,

coordinating them often relies on paid staff. If staff time is reduced, it can affect the support and training volunteers receive, reducing our overall impact.

● Impact on Service Users: Ultimately, any increase in overheads means there’s less available for the people who need us most. Parents and carers in our community often turn to us in moments of crisis and it is our duty to ensure we are there with the right support at the right time.

A Ripple Effect on Families

It’s not just the charities that will feel the pinch. Many of the families we support are also on low or fixed incomes. The rise in employee National Insurance contributions means less money in their pockets, at a time when food, fuel and childcare costs are already high. For parents and carers juggling work, caregiving and tight finances, this could push some closer to breaking point.

What Needs to Happen

We understand the government’s need to raise funds for health and social care. But it’s vital that policymakers also consider the unintended consequences for grassroots charities, particularly those supporting vulnerable families. We call for:

● Charity-specific relief or exemptions from increased employer contributions

● Increased local authority support to help offset the impact of rising operational costs

● Open dialogue with the charity sector, especially organisations working with

disadvantaged communities

Standing Together in Challenging Times

At our heart, we are here for the families of Chichester, and we always will be. But to

continue offering support and advice to our families, we need understanding, flexibility and meaningful support from both the government and the wider public.

If you’re a local business, policymaker or concerned member of the public, please reach out. Your support could make all the difference.