Charity boss describes 'gloomy picture' over NI rise

Age UK runs day clubs, community cafes and an advice line

A charity that supports the elderly says it may reduce its services in Leicestershire due to a projected £400,000 increase in its National Insurance payments.

Age UK runs day centres and shops across Leicester and the wider county but fears it will have to slash the services it provides to older people.

Tony Donovan, executive director for the charity in Leicestershire and Rutland, said it was a "really gloomy picture" and a lot of older people were worried "because Age UK for them in a lifeline".

A Treasury spokesperson said the government's tax regime for charities was "among the most generous" of any country in the world.

Describing the change to National Insurance rules, Mr Donovan told the BBC: "It is massive. It's actually crippling us and we can't ignore it.

"We can't carry a deficit because if we carry a deficit, say of £450,000, £500,000 a year and perhaps rising, then ultimately the charity and other charities won't survive."

He said if older people could not access the services, many would struggle with their mental and physical health.

Sophie O'Connor says attendees of her class arrange to meet up afterwards and socialise

The charity has a shop, cafe and runs classes at Clarence House in Leicester.

Mr Donovan said the cafe used to attract about 700 people a day, but now that figure was about 300, meaning a drop in income.

Sophie O'Connor, a dance teacher who runs one of the many Keep Fit classes there. said: "It's extremely rewarding for them, but at the same time, it's nice for me to also see how beneficial it is to them guys.

"It does mean a lot to them."

The increase in the levels of National Insurance contributions to be paid by charities was announced in the government's Autumn Budget.

A Treasury spokesperson said: "We have protected small charities and businesses by more than doubling the Employment Allowance to £10,500, meaning more than half of them with NICs [National Insurance contributions] liabilities either gain or see no change next year.

"Charities will still be able to claim employer NICs reliefs including where eligible and are still exempt from business rates."