Mental health charity calls for government help as services to take £250k hit due to NI tax hikes

6 February 2025, 10:47 | Updated: 6 February 2025, 10:55

A mental health charity has called for more support from the government as it faces £250,000 cuts due to increases to national insurance and the national living wage.

Coventry, Warwickshire and Worcestershire Mind CEO Steven Hill said that the charity was "propping up" health and social care services - yet has been left to struggle during its toughest period.

With upcoming changes to national insurance and the national living wage, the charity is being forced to make cuts, despite there being a higher a demand than ever before.

It comes on Time to Talk Day, with Brits encouraged to open up and be honest about their mental health - be it with a friend, family member or colleague.

The charity is holding a number of events to mark the occasion, including chats and activities at their wellbeing hubs.

Members of the team will also be visiting businesses and organisations across the region to talk about the importance of mental health.

But such services are set to be hit hard in coming months, with the charity having to make "really tough decisions" to deal with financial pressures.

The changes, due to come in from April this year, will cost the charity around £250,000 - and could result in staff cuts as it fights to keep its doors open.

Read more: William and Kate to launch mental health programme in Sandringham

Read more: TikTok to ban teenagers from using beauty filters over mental health concerns

"One of the big challenges for any charity at the moment is how they're going to afford the national increases,' Mr Hill told LBC.

"Both the national living wage and national insurance have come at somewhat of a significant cost to us. We're talking hundreds of thousands of pounds we've got to find a year to cover those insurance additional costs.

"This is money that we have to find from pots of money that we generate through income generation and fundraising.

"Our contracts are not changing significantly so we're not going to see that money coming through the commission services that we have. So we've got to find that money.

"And this is all coming at a time when we're seeing more and more demand for our services.

"We're seeing more people wanting more to access the support that we offer and more people coming forward that have more complex mental health needs.

"So we're having to support people perhaps for longer than we would have originally supported people for because of the complexity of what they're dealing with.

Mr Hill said he recognised that the government had a difficult job trying to balance the budget of the nation, but it is coming at a cost to services that are needed most of all.

"It's really concerning," he said. "When it comes to things like fundraising, people have less money in their pockets now too.

"Trying to get people to raise money for you is hard because we're all having to make some cuts in our own lives in terms of what we can afford to do."

Mr Hill continued: "We are propping up health and social care - that is what we do. If we weren't there, where would people go? The only option would be for them to go to health and social care to get the support they need."

The charity has already seen an influx of people going to them due to NHS waiting lists being too long.

"I do feel the government should consider the charitable sector," Mr Hill went on to say. "They should consider the fact that we're often the ones that are paying the lowest salaries.

"We've been hit double whammy because the national living wage is also a pressure on us. We are potentially going to have to make some really tough decisions as an organisation as to what we can afford and that is a really hard thing to have to do when we know that demand is out there."

The charity has already been forced to make several cuts over the last few years, without factoring in other rising costs such as energy bills.

"We run a lot of residential properties," Mr Hill said. "We don't get reduced rates because of being a charity.

"We've already stripped back as much as we can strip back when it comes to being as cost efficient as we can.

"The next option is going to have to be whether we can afford... the biggest resource we have is staffing, unfortunately."

Having worked for the charity for 30 years, Mr Hill said: "I do what I do because I love the impact that we have and the support we can give to people.

"I love my job so much, but it doesn't come without its challenges at times. And this is probably one of the biggest challenges we've ever had to face."

Chancellor Rachel Reeves announced in her October Budget that employers' National Insurance contributions would rise by 1.2 per cent to 15 per cent from April 2025.

The National Living Wage for people aged 21 or older is also rising by 6.7 per cent - from £11.44 an hour to £12.21.

Following the announcement, Mr Hill reached out to several local MPs for support.

Manuela Perteghella, the Lib Dem MP for Stratford-on-Avon, told LBC: "The Liberal Democrats have repeatedly pushed the government to exempt healthcare charities from the hike on NICs.

"Mental health charities, as well as other healthcare charitable organisation, do incredible work in the community, in schools, and in other settings across my constituency of Stratford-on-Avon, and they should not be penalised in the budget."

The Treasury was contacted for comment.