National Insurance Contributions (Secondary Class 1 Contributions) Bill

Baroness Fleet Excerpts

Committee stage
Tuesday 4th February 2025 Grand Committee

[Baroness Fleet (Con)]

My Lords, I support my noble friend Lady Monckton of Dallington Forest’s Amendment 31. My noble friend is a tireless and brave campaigner in the charity sector, and she has spoken so movingly today about this Bill.

I declare my interests as listed in the register. I am a council member of Arts Council England and the chair and co-founder of the London Music Fund, a charity that provides music scholarships for talented children from low-income, disadvantaged backgrounds.

I have not previously spoken on this Bill but, as a passionate supporter of the arts and creative industries, I speak today for one very good reason: the national insurance increase will be devastating for the arts, which are, of course, great contributors to the hospitality and tourism sectors. Even Sir Nicholas Hytner, probably the greatest director of his generation, has said that this Government are doing more harm than good. Artistic enterprises will fold. Theatres, arts venues, museums, orchestras, music charities, conservatoires and dance and opera companies are all reeling as they work out exactly what the impact will be. The National Theatre, for example, reckons that it faces an annual bill of £1.1 million in addition to the minimum wage rise.

A report in The Stage newsletter recently calculated the overall impact on theatres. The cost averages out at about £100,000 per theatre, with the double whammy of NI and minimum wage. The Theatre Trust estimates that there are more than 1,100 theatres across the UK. Thus, a conservative estimate is a cut of £100 million to UK theatre, spread across the subsidised and commercial sectors. As Alistair Smith writes in The Stage, if the Government had instead announced a cut of £100 million to theatre funding at the Budget,

“the entire sector would be up in arms”.

Indeed, every budget is being revised and the reality is hitting home: smaller casts, fewer risks to be taken, redundancies and lower employment levels.

The Society of London Theatre estimates that 40% of theatres and performing arts venues are at risk of closure over the next five years. The larger arts venues will be clobbered by national insurance bills: £750,000 for the Southbank Centre; more than £1.5 million for the Royal Opera House; and £280,000 for the Opera North company. Two-thirds of museums are concerned about funding shortfalls. Think of the tourists who go to our great museums every year. So much for growth, levelling up and supporting the arts. Music services central to the delivery of music education to primary and secondary schools will, according to Music Mark, be hit by a bill of around £7.5 million.

This Government once trumpeted their support for the arts—how that was welcomed—but now we know that those soothing words were empty and meaningless. All arts charities slog away at raising funds from generous donors, and now some of that hard-won cash will just go into the Treasury’s coffers. This is money that was raised in the expectation of supporting creativity, access for low-income audiences and children, and so much more. This Government are no friend of the arts. It is a shameful betrayal.

[Baroness Kramer (LD)]

My Lords, again, in the first two days we had an extensive discussion of the hospitality, leisure and tourism sectors. Once again, we stress the importance of tackling part-time work as a mechanism to keep these sectors from suffering the full impact of the Government’s changes, so I will not repeat that for about the fourth time today. We continue to be of the view that simply talking about impact assessments and employment allowances do not get us where we need to be. I am afraid that this is an issue of exemption, and the noble Lord knows that on part-time work, I feel very much that we should be reducing employers’ national insurance contributions.