The learning disability charity Mencap has warned that about 60 of its services could be affected by the planned uplift to employer National Insurance contributions and other measures included in the recent Budget.

The charity said the planned changes to employer NI contributions – the rate will increase by 1.2 percentage points from April – were unexpected and would cost the charity more than £5m per year.

The plans also included a reduction of the threshold at which employer NI contributions start being levied, from £9,100 to £5,000 a year. 

The National Council for Voluntary Organisations has estimated that the changes could cost the voluntary sector £1.4bn a year and urged the Chancellor, Rachel Reeves, to provide exemptions for charities, but she refused. 

Jon Sparkes, chief executive of Mencap, said 60 of the charity’s services could be affected by the NI changes, but this number could be higher depending on how local authorities respond to the need to cover its increased operating costs.

He said: “If local authorities aren’t given more money for social care, we are going to need to make some difficult decisions over the coming months to maintain the level of care we pride ourselves on, and our strong financial position as an organisation.

“This could mean handing back care contracts to local authorities, which is always an absolutely last resort that we hope not to get to.”

Sparkes added: “At the point where we’ve worked with local authorities to exhaust all options and are certain we need to hand back a service, we would communicate with any affected staff and families and inform the people we support. But at this stage, there are still a lot of unknowns.”

The Budget also included plans to raise the National Minimum Wage, with hourly rates for over-21s set to increase to £12.21 an hour. Mencap said this would cost the charity more than an additional £6m per year.

Sparkes said: “Social care is a public service that needs proper funding. Our dedicated colleagues who work to support people with a learning disability deserve to be paid more for the highly skilled work that they do. 

“We hope to see a dedicated fund for care workers agreed by the government to cover these extra costs, and a longer-term plan for investing in social care.”

Mencap employs 7,500 staff and has an annual turnover of £228m, 95 per cent of which is for services it provides.