East Midlands homelessness charity calls for exemption from National Insurance increase

Framework is calling on the government to exempt charities tackling homelessness and rough sleeping from the increase in Employers' National Insurance.

The charity is facing an additional bill of £1.1million a year in Employers' National Insurance contributions and an extra £700,000 to cover the increase in the living wage.

The challenge of finding another £1.8m a year when budgets have already heavily constrained means the charity is now faced with making cuts to essential frontline services.

They say there is no safety net of income for charities to fall back on.

Framework Chief Executive Andrew Redfern says: "The withdrawal at the stroke of a pen of £1.4 billion from the charitable sector will cost a lot more than it saves as the impact on services will be dramatic. For example at Framework we have done the cost saving measures; the only option now is to cut services if the organisation is to remain viable. These are not services that are nice to have; often these are the only public services available to some of the most vulnerable people in our communities."

He said the unexpected NI increase has forced them to change their plans.

"We've been working hard to balance our budget for next year, we work on very tight margins. This put a hole in the whole thing and took us back to square one."

Deputy Chief Executive Claire McGonigle added: "Taking such a huge amount out of the charitable sector...feels at best counter-intuitive and at worst stupid."

Andrew Redfern continued: “Rough sleeping is the tip of the homelessness iceberg. It is rising nationally and locally – the outcome of conscious policy choices. The sad thing is that having tackled this before, government knows what to do but has stopped doing it.

"The inadequate supply of housing, the decommissioning of prevention work and the catastrophic loss of funding for supported housing, have all played their part.

"We continue to make the case to government for a reversal of these policies, starting with exemption from the ENI increase for charities tackling homelessness, rough sleeping and related issues. The long-term necessity is to re-establish a national programme for the commissioning of housing-related support. Regrettably, until this happens we expect to see further increases in single homelessness and rough sleeping."