National Insurance Contributions (Secondary Class 1 Contributions) Bill

Lord Ahmad of Wimbledon Excerpts

Report stage
Tuesday 25th February 2025 Lords Chamber

[Baroness Fraser of Craigmaddie (Con)]

My Lords, I am not an economist, but I run a small Scottish charity that provides health services. I want to come back on some of the points raised.

I wish the noble Lord, Lord Eatwell, the noble Viscount, Lord Chandos, and even the noble Lord, Lord Macpherson, had had the recess that I have just had—looking at our employees, some of whom have been with us for over 20 years and are highly trained clinical specialists, and telling them that their roles are under threat of redundancy. As I said at an earlier stage of this Bill, I have not been able to participate in it as much as I would have wished because of its effects on my organisation, which are that people will lose their jobs and organisations will lose skill. Those are very difficult things to build up again.

Like the noble and learned Lord, Lord Wallace, I have been in touch with the Coalition of Care and Support Providers in Scotland. I am slightly concerned that these amendments do not cover health and social care services in Scotland. If he is to bring back an amendment at Third Reading, I will happily work with him on it.

I would love a simpler tax regime and would absolutely support it. The way to have one is not to have this national insurance increase—that would be very simple. The lists covered by these amendments are all of organisations that support public services and the public sector. These are services that many government agencies are required to provide by law, yet they are farmed out to organisations such as ours, as well as to CrossReach, Ark and others.

Frustratingly, this demonstrates a huge lack of understanding by this Government of how these measures will affect vulnerable people—the people who these organisations support. My organisation, Cerebral Palsy Scotland, is a regulated, registered charity, so we cannot put up prices. Our raison d’être is to make our services available to the most vulnerable who cannot pay for them, and so we cannot put up our prices. Yes, we may have benefitted last year from paying slightly less employers’ or employee national insurance, but all our providers—the people who clean our centres, help us with IT, empty our sanitary bins, and things like that—employ people and they are all putting up their costs. Our costs are rising, our national insurance is rising, and because of the minimum wage increases at the same time, it is becoming more and more expensive for us to employ people. The only thing we can therefore do is to cut our cloth and employ fewer people.

I do not understand these measures. I support having lists of different sectors, because these are the sectors that are delivering support that gives people choice, quality of life and control over their lives, and that support the NHS and the social care sector, which would otherwise be stuck. This is a measure that will not save public services, as the Minister has told us it has been put in place to do, but that will, I am afraid, crush them.

[Lord Ahmad of Wimbledon (Con)]

My Lords, briefly, I support the amendment so ably tabled by the noble Baroness, Lady Barker. I pay tribute to her for her attentive nature during Committee. I say to the noble Lord, Lord Eatwell, that the fact there is this extensive list demonstrates once again the lack of an impact assessment, on which I implored the Minister in Committee.

I was a Minister for over 12 years. One thing you learn as a Minister is that, when taking a Bill through, you must consult with and speak to the sectors—you must talk to them and understand their challenges and then address those issues. Unfortunately, that had not been done. Take adult social care, where the impact is close to £1 billion. We may hear from the Minister that this has been addressed in the Budget, but it has not. The Nuffield Trust has said as much: the actual measures put forward in the Budget will be dwarfed by these contributions, and that is just in adult social care. Talk to community pharmacies and they will make a desperate plea, akin to what we have just heard from my noble friend, and say that they will have to shut. Why? Because they cannot afford to keep their employees.

Even at this late stage, I implore the Minister to listen, connect and communicate, and, I hope, to take on board some of the challenges and important concerns being put across in this House on behalf of the many different community services that will so desperately be impacted by these national insurance increases.

[Lord Leigh of Hurley (Con)]

My Lords, I am somewhat amazed by some of the arguments I have heard in this debate. The Bill is before us and we are a revising House. Our purpose is to debate the Bill, put forward amendments, debate the amendments and vote on them. The idea that we should not be changing this because we should not change the Budget is absurd; it defeats the whole purpose of having the House of Lords. We are a revising Chamber; we bring with us expertise and experience, which many of us would like to think assist the Government in their decisions, particularly when they make bad decisions—of which this is one.

The noble Lord, Lord Eatwell, talked about Adam Smith’s desire for simplicity, but he also wanted fairness. What has happened here is not fair. If the noble Lord consults the organisations with which I know he has been connected in the charitable and university sector, they will all say that this is a very unfair imposition on their modus operandi.

There is a reason why there are so many amendments. The first amendment is excellent, and passing it will deal with all the issues in one go. If it is not successful, other amendments will follow that will detail the sectors on which laws can focus their attention.

The noble Lords, Lord Eatwell and Lord Macpherson of Earl’s Court, and others may not have heard me in Committee, where I attempted to cost the various types of amendments, as well as the whole effect of the Bill, on the charitable sector. We have made attempts to detail them, and in other groups of amendments I will discuss those numbers and invite the Government to comment on them. The absolute total that the charitable sector itself has said that this would impact will be £1.4 billion, out of the alleged £22 billion black hole that the Government claim. We have made suggestions about how this may be recouped in other areas.

In Committee, I talked about the enormous damage that the Government are about to impact on the adult social care sector. It is utterly demotivating for the very many people, including me and others in this Chamber, who go out fundraising for such charities, doing our best to help those in need, only now to see the Government snatch it away in such a heartless manner.

In Committee, we discussed some of the big numbers. At that stage, I focused on social care and, as an example, the cost that Jewish Care faces—£1.1 million, which it does not have—to pay for this increase in national insurance. This time, I will discuss hospices, because I do not want to repeat what was said in Committee—albeit it was in Grand Committee and so did not allow us the opportunity to vote, which was extremely disappointing.

I will look at one hospice: Thames Hospice, which is close to Hurley. I was introduced to it by my then local MP, who is now my noble friend Lady May of your Lordships’ House. Its excellent CEO, Dr Rachael de Caux, is reported as explaining that it will now have to post a £1 million deficit and that the NI increases, together with the national minimum wage increases, will cost it £650,000. This is a charity that raises some £4 million from its fundraising, so that is a very material sum. As she herself memorably put it:

“The NHS is supposed to be from cradle to grave and what we have is from cradle to a few months before”


the grave.

Yes, a £100 million for the sector was announced before Christmas, but, as my noble friend Lord Howard of Lympne explained, it is a one-off spend over two years—actually, it is largely back-ended, with most of it in the second year—and restricted to capital sums. In fact, it is spread over 170 hospices, so it is a bit of an insult to claim that that is proper compensation.

Thames Hospice is looking to try to serve 400 people, mainly in their homes. I was very pleased to see that, in the amendment, proposed new paragraph (f) specifically covers those who are being cared for at home. As a charity, it is dependent on the local community for its generosity and financial support. The Government cover only about 30% of its costs, and the hospice has to raise £34,000 a day to provide all its services. The Government know that the demand for these sorts of services will grow. It is estimated that, in Thames Hospice’s catchment area alone, the overall demand for palliative and end-of-life care is expected to grow by at least 9% by 2030, with the number of deaths rising to 4,150 in 2030.

Perhaps the Minister can explain to Thames Hospice what it is expected to do, following this attack on hospices by the Government. Is it supposed to turn away people? Will it have to offer less care? It will see more people die in pain and agony, as it cannot offer the palliative care that it wishes to provide. I am sorry to be so graphic, but that is the choice for your Lordships’ House today. How can anyone hold their head up high if they walk through the Division Lobby seeking to cause such damage to the hospice sector?

National Insurance Contributions (Secondary Class 1 Contributions) Bill

Lord Ahmad of Wimbledon Excerpts

Committee stage
Wednesday 29th January 2025 Grand Committee

[Lord Ahmad of Wimbledon (Con)]

My Lords, I support my noble friend’s amendment and will speak briefly.

The Minister in the other place said that the Department for Education made an assessment of the impact of the rise in NICs on special educational needs. Bearing in mind the debate that we have already had on the lack of impact assessments, if an assessment has been made, it should be shared. We have already seen the disproportionate impact of VAT on independent schools and the impact that it is having on children with special educational needs. Again, this is tantamount to a double whammy. These children are among the most vulnerable in society.

I reflect on my time as a councillor in my local authority many years ago: the vital link and lifeline that these drivers provide, as my noble friend Lady Monckton has articulated so passionately and poignantly, are essential. I also reflect on the statement made by the Chief Secretary in the other place, which said that, when we are pursuing economic growth, these changes must permeate every element of society—I paraphrase—and every part of our country. How can impacting the most vulnerable contribute to any kind of sensible understanding of growth?

I was a Minister for a long time; perhaps that is why I am not counted alongside the dynamic duo, on my side of the Committee, of my noble friends Lady Neville-Rolfe and Lady Noakes. I say this to the Minister: one thing that Ministers in your Lordships’ House do is listen—the Minister is doing that—but that listening also turns into action. Many vulnerable groups, including those highlighted by my noble friend, are being impacted. As a minimum, surely we need engagement at this stage. After all, that is what we are all about: scrutiny, listening, reviewing and ensuring that, when it leaves the House, legislation is in a better state than when it got here. I appeal to the Minister, as a minimum, to engage and listen to some of these groups that my noble friend highlighted. Perhaps, through his intervention, the Government will think again.

[Viscount Goschen (Con)]

My Lords, the Committee is very much in the debt of my noble friend Lady Monckton for her having raised this important issue this afternoon, because it presents a microcosm of all the arguments around the Bill. It is a narrowly focused amendment that draws the Committee’s attention to one narrow measure—one small, but very important, part of our national life. It is therefore incumbent on the Minister to give a substantive answer, not just “We don’t do further impact assessments”, because I am not sure that there is widespread belief in the country about the impact assessment that the Treasury notes has been made. I do not believe that that gives sufficient confidence. It is a short, high-level note and, at the bottom of the electronic page, it asks, “Did you find this page helpful: yes or no?” I think that most Members of the Committee would reply in the negative.

It is important for the Minister to listen to an illustration of the effect that this Bill will have, as we have heard in previous groups of amendments, on the wider growth of our economy as well as on extremely vulnerable people, as was illustrated by my noble friend’s amendments. I very much look forward to the Minister’s detailed and substantive answer.

Climate Agenda

Lord Ahmad of Wimbledon Excerpts

Thursday 24th October 2024 Lords Chamber

[Lord Ahmad of Wimbledon (Con)]

My Lords, I thank my noble friend Lord Lilley for securing this important debate and for his insightful introduction. Climate change is real and a living reality for many across the globe. Indeed, for some small island nations, it remains an existential threat and it impacts growth and prosperity. In welcoming my noble friend Lady May to her place, I note that she brings incredible insights and a deep sense of devotion to public service, as we heard from the noble Lord, Lord Young. During her tenure as Prime Minister, she championed tackling climate change and was a powerful advocate of collective action on the world stage. To coin a phrase, we are all in it together.

My noble friend Lord Lilley talked of my noble friend’s decision to appoint him to this House. I assure my noble friend that, perhaps like others, we love hearing his voice. I agree with his call for transparency of costs for enabling those long-term decisions, both at home and internationally.

As far as appointments are concerned, I will take a moment to give my personal reflections in relation to my noble friend Lady May. The noble Lord, Lord Young, talked of her selection for Maidenhead. She left a vacancy in Merton and I followed in her shoes, minus the heels of course—although perhaps, standing at five feet six, I would have benefited greatly from them. Nevertheless, she was an advocate for localism, and it was an honour to follow her. Indeed, she introduced me to the Conservative Party and appointed me as Minister of State at the Foreign Office. That turned out to be a long-term decision.

When I was appointed to the Foreign Office, one of my early visits was to the Caribbean. I was at the Pacific Islands Forum in Australasia, in Fiji. Hurricanes hit the Caribbean, and there was a moment of trepidation. Very early on in my career at the Foreign Office, I needed to invoke that call to the boss, to alert the Prime Minister to what had happened in the Caribbean. My noble friend acted promptly and convened a COBRA meeting, and with others I was dispatched to the region. What I saw was nothing short of devastation—it was like a war scene. It instilled in me the need to tackle climate change collectively and the need for international action.

What I saw first hand was physical devastation and the economic impact on both independent nations as well as our overseas territories. In Antigua and Barbuda, the country’s entire GDP was wiped out by Mother Nature and the ravages of the hurricanes. It brought into focus the importance of climate finance, which I will focus on, and the need to update processes and dated bureaucratic procedures that hindered countries’ abilities, particularly those that had graduated to middle-income status. Through a single event, through no fault of their own, they saw their economic infrastructure wiped out. As I look towards the Minister, I hope the Government continue to advocate for reforms in these international structures. They need reform urgently. I hope the Government will champion the importance of small island developing states accessing funds. More pointedly, the issue of access must be addressed. Much work needs to be done on technical support for these countries.

As a country, we have already signed up to internationally agreed targets limiting our emissions, and we have delivered on these. But the UK has also stood up and committed to providing financial support to developing countries, in the form of international climate finance. In 2009, the UK, together with other developed countries, committed to providing $100 billion in climate finance annually by 2020, provided by both the public and private sectors. During the UN high-level week in 2019, I announced a commitment of £11.6 billion for the years 2021 to 2026 on behalf of the United Kingdom, in support of this international target. Yes, the UK was rightly recognised as an international leader on this important priority. Can the Minister please confirm that the Labour Government will continue to uphold our international commitments?

The previous Government committed to investing directly in both adaptation and mitigation. They committed to spend $3 billion on nature, which was a priority of the COP we hosted in Glasgow. The direct benefits are clear: when you travel around the globe, you see how climate change impacts and you see the results of taking action. When I visited Bangladesh, I saw that nature-based solutions, through the replanting of mangroves, have a major and powerful result, not just mitigating typhoons but saving lives. As my noble friend highlighted, such action saves livelihoods.

At COP 26, we introduced the Global Forest Finance Pledge, and I hope the Government will continue to champion this, particularly as CHOGM is convened this week with our Commonwealth family of nations. Therefore, I ask the Minister again: can he confirm that the Government remain committed to upholding existing commitments? I was somewhat puzzled—perhaps the Minister can clarify—by how the commitment that the previous Government made on climate finance can be squared with the Foreign Secretary’s recent statement that the ICF would be subject to a planned spending review.

The issue of the UK’s green finance strategy, where the private sector is being mobilised, is also an important priority. I hope the Government will continue to focus on the strong relationship and co-operation between Governments and the private sector, which we heard about from the noble Lord, Lord Browne. I look forward to the Minister’s reply.