STAFF supporting homeless people are themselves having to use food banks a councillor who warned employers will struggle with increased National Insurance contributions has said.
Support for the homeless and housing is provided by councils in partnership with housing charities described as the “third sector” which are neither public bodies or private firms, and funded from the Welsh Government’s Housing Support Grant.
That is worth £4.6 million a year to Torfaen Borough Council and this year also incorporated the Homelessness Prevention Grant for a total budget of £5.7m, and funding was increased to support the Welsh Government’s commitment to fair working conditions and promoting service sustainability.
The council passes some of that money on to housing charities and third sector bodies to run services and employ staff as well as using it for its own activities and supporting them with training.
But councillor David Daniels, Torfaen’s cabinet member responsible for housing, said he feared the impact the increase in employer’s National Insurance contributions, announced in the UK government’s October budget, and uncertainty whether that rise will be funded for council contractors.
The Tuesday, December 3 cabinet meeting was told changes to National Insurance, which increases the rate employers must pay as a contribution for each employee and a lowering of the threshold from which the tax applies, is likely to cost Torfaen around £2.5m in the upcoming financial year.
But the council’s head of financial services Robert Green said the council is confident that cost will be met from central government.
But he warned “it is a lot more opaque around third party services”. He said discussions are ongoing between the Welsh and UK governments and there may be further information early in the new financial year.
Cllr Daniels said any additional cost could hit groups the council works with on homelessness and housing support.
He said: “That National Insurance increase is a significant concern. We will be waiting like many other councils, and charities, and looking for intervention from the UK government on what the impact is on those support services.”
The Labour councillor said support services haven’t been able to offer sufficient salaries and said: “They have been facing very uncertain circumstances and some staff from those providers have had to rely on support services, like food banks, themselves.”