The 2024 Autumn Budget outlines the government’s tax, welfare, and spending priorities through to March 2026, with a framework extending into the next decade. This budget also serves as a precursor to the spring spending review, which will determine allocations for central government departments through to 2029.
Below, the Charity Insurance experts here at WRS summarise the key announcements that will likely support the third sector:
Boost in Local Government Funding: A 3.2% rise in core local government spending, including a minimum of £600 million for social care, provides a needed boost for social services
Special Educational Needs and Disabilities (SEND): £1 billion (a 6% real-term increase) allocated for SEND support
Hardship Funding: £1 billion for the next year to extend the Household Support Fund
Support for Individuals and Carers: This includes a reduction in Universal Credit debt deductions from 25% to 15%, a higher weekly earnings threshold for Carer’s Allowance, and an independent review of Carer’s Allowance overpayments
Education Funding: An additional £30 million for free school breakfast clubs and £2 million in additional funding to support Holocaust education initiatives
Financial Pressures Facing Charities
The Budget also introduces financial strains for charities. A 6.7% increase in the national living wage and a hike in employer National Insurance contributions (NICs) to 15% (effective April 2025) will create new costs. Additionally, the NIC threshold has been lowered from £9,100 to £5,000. While these changes promote fair wages, they could place additional stress on charities already struggling with rising operational costs, reduced funding, and heightened demand for services.
Smaller charities, in particular, may need to reallocate resources away from essential services, affecting the communities they serve.
Further budget measures affecting charities include:
Charity Tax Legislation: New laws will prevent charity tax abuses starting in April 2026
Inheritance Tax Relief: Inheritance tax reliefs for charitable gifts remain unchanged
Increased Charity Commission Funding: From April 2025, the Charity Commission will receive an increased budget alongside a 3.5% reduction in the DCMS budget.
“Trailblazer” Programs: £240 million for local initiatives aimed at streamlining support for inactive individuals
Private School Tax Adjustments: Removal of VAT relief and a restriction of business rates relief to schools serving students with special education, health, and care plans.
Mental Health Crisis Centres: £26 million allocated for mental health support
In summary, the 2024 Autumn Budget offers both opportunities and challenges for the charitable sector. On the positive side, increased local government funding, targeted support for carers, and new allocations for education and hardship relief provide potential benefits for charities and the communities they serve. These measures could enhance service delivery and relieve some financial pressures on individuals and families.
However, rising operational costs due to changes in wages and employer National Insurance contributions may strain charity resources, particularly for smaller organisations. As the sector prepares for the spring spending review, charities should continue to evaluate these developments to understand how best to navigate the financial pressures and opportunities presented by the budget.
This article is for informational purposes only and should not be considered legal advice.
About WRS
At WRS Insurance Brokers, we are specialists in Charity Insurance and Social Enterprise Insurance and our team is passionate about the charitable sector. As a business with a strong social conscience, we’re passionate about helping support the work of organisations that make a difference.
WRS is proudly part of the Benefact Group, a charity-owned, international family of financial services companies that gives all available profits to charity and good causes.