A company with six care homes in Pembrokeshire has revealed it’s facing a £150,000 hit as a result of controversial Budget measures.

The hikes in National Insurance payments, as well as increases in the Real Living Wage, will see care homes facing “12 months of instability”, according to Mike Davies from Sunset West Care Homes.

Mr Davies, the managing director of Sunset West Care Homes’ holding company Dale Roads Group Ltd.

The group’s six care homes include Langton Hall Residential Home in Fishguard, Pen-Coed Residential Home in Saundersfoot and Woodfield Nursing Residential Home in Narberth.

Its other homes are Woodland Lodge Residential Home in Tenby, Torestin Care Home in Tiers Cross near Haverfordwest and Pembroke Haven in Pembroke Dock.

Mr Davies predicted some struggling care homes will have to ask families to help meet the cost of the care of their loved ones.

He is supporting a new campaign launched by Care Forum Wales (CFW) calling for social care to receive an NHS-style exemption from the National Insurance increases or emergency financial support to stop care homes and domiciliary care companies going bust.

CFW chair Mario Kreft MBE is leading the group’s new campaign, Save Social Care, Save the NHS.

He has outlined the organisation’s stark warning in a letter to Welsh MPs, Senedd members along with First Minister Eluned Morgan and Health Minister Jeremy Miles.

A similar letter has gone to Prime Minister Kier Starmer and Chancellor Rachel Reeves.

The campaign is being supported by the Five Nations Group which represents care organisations from across the UK and Eire.

They all agree that third sector providers, including charities and hospices, will also be put at risk by the “ruinous measures” contained in the Budget.

Mr Davies said he shared those concerns and said his company’s six care homes were facing an additional total bill of more than £130,000 just to meet the National Insurance increase.

On top of that the company has also calculated the costs of paying Statutory Sick Pay on the first day of sickness for the group, based on current levels of sickness, would incur an annual cost of an extra £18,000 .

And he said the group, which has 169 registered beds, would take another financial hit to meet the cost of the wage hike unless extra funding was provided by Cardiff Bay and Westminster.

Mr Davies, who has been involved in the care sector for more than 30 years, said the additional costs outlined in the Budget were a further blow to care homes which were still trying to recover from the Covid emergency.

He said: “Operating during Covid, staff resources were pushed to the limit.

“Everybody was tired and fatigued from getting the job done, it’s been tough, and now we have these additional costs to deal with from the Budget.

“We believe if the costs stay stationary now, we would be looking at an extra £130,000  plus for National Insurance.

“And we haven’t even looked at the increase in wages yet, but that £130 0,000 is a snapshot of the challenges we are facing.

“I really believe we will be going into uncharted territory.

“The social care sector in Pembrokeshire will become unstable.

“We have seen home closures already and the likelihood going forward is the smaller operator will find it more difficult .

“We are relying on additional money to meet the new costs.”

He said where that required extra funding following the Budget would come from would be a key question.

Mr Davies said the local authority would have to step in to help, and families of residents might also have to be asked to contribute to the shortfall.

He said: “Eighty per cent of our occupancy in the county is actually from local authority placements. So the local authority would be the people that would need to look at it.

“If there is a shortfall then we would be using an additional voluntary contribution from families.

“We are going to be talking to our MP and all the politicians in Pembrokeshire, we’re working on that now, because the cost of care is going to increase massively.”

With a 1.2 per cent rise in Employer National Insurance contributions and a cut to the Secondary Threshold to £5,000 alongside the five per cent increase in the Real Living Wage to £12.60, Care Forum Wales (CFW) has calculated the sector in Wales faces a £150 million funding hole to plug.

According to the CFW chair Mario Kreft MBE, the only way to avert the funding crisis was for the social care sector to be granted an NHS-style exemption from the increases in employers’ National Insurance contributions or failing that support to meet the other additional costs.

He said: “It represents a 37% increase in employer NIC for a member of staff earning £25,000 a year which equates to the Real Living wage

“If social care can’t be exempted, then the huge extra financial costs imposed as a result of the Budget must be paid for one way or another because this is a tax on publicly funded care, a tax on working people that’s going to hit families.”

Mr Davies said: “I would absolutely back that, we do need that. That would be really helpful.

“We have discussed funding issues with local authorities and their concern is they don’t have the money either, the council tax won’t cover it.

“It’s going to have to be the Welsh Government and then Westminster feeding into it.”