National Insurance Contributions (Secondary Class 1 Contributions) Bill

Debate between Lord Forsyth of Drumlean and Lord Scriven

Committee stage
Tuesday 21st January 2025 Grand Committee

[Lord Forsyth of Drumlean (Con)]

My Lords, as we have heard, it is rather unusual for a Bill that will have such a devastating impact on our country, businesses, charities and so on to have its Committee stage in Grand Committee. Normally, we would have it on the Floor of the House. It is certainly true that past national insurance Bills have been taken in Grand Committee, but it is distressing that the Government have chosen to push this Grand Committee to consider a very controversial Bill that will affect many groups of people. It should be taken on the Floor of the House.

I hope that this is neither a precedent nor a move that drives us in the direction of the House of Commons, which moved towards the timetabling of Bills, and proper scrutiny of important Bills, on the Floor of the House. We are familiar with the consequences of that: us having endless amendments to legislation that has not been properly scrutinised. If this was about saving time, I do not think it is going to work, because the fact that we cannot have votes in this Committee will mean us spending, perhaps unnecessarily, rather a long time on Report. Of course, the whole point of Committee stage is that it enables a bit of to and fro and discussion under the rules that apply in that respect.

I find myself in an unusual position in the Grand Committee, speaking on a highly controversial Bill, devastating in its consequences. The Minister is keen on telling us about black holes and this creates an enormous black hole in the delivery of public services and for businesses up and down the land. The unusual position in which I find myself is being in complete agreement with the noble Lord, Lord Scriven. I started to make notes to find something that I thought he had got wrong, but I could not say anything until I looked at the amendment, because the flaw in his erudite and proper analysis of the damage that will be done to GPs, social care, pharmacies, hospices and others is the distinction that he makes between the public and private sectors.

Apparently, if one is doing this in the private sector, it is okay to slap on a great tax that means one has to consider dismissing staff and so on. But if it is in the public sector, that is completely unacceptable. This is particularly egregious, although I think, and the noble Lord will correct me if I am wrong, he makes an exception for the provision of care home services in the private sector. I am not sure if that is right. I shall happily give way to him if he thinks I have got it wrong. In other respects, however, it is all about giving—

[Lord Scriven (LD)]

My amendment is clear. It is not just about the public sector. It talks about anyone who is contracted, which could be in the private sector.

[Lord Forsyth of Drumlean (Con)]

Yes, but that that completely removes the private sector providing, for example, social care. A report on social care from the Economic Affairs Committee, which I chaired some time ago, was very much endorsed by the House as a whole—there was unanimous agreement across the House. It made clear what is happening in private care homes, for example. People who are paying their own fees, as opposed to them being paid by the local authority, are being charged up to 40% more to subsidise people who are in those homes as a result of the local authority. Here we have a situation where the burden is placed even more strongly on people providing care out of their own savings and resources.

It seems to me that a distinction is being made between the elements that are providing care. For example, in dentistry, every time I go to the dentist—I see him every six months, when he has me in a position of some vulnerability—he tells me that he is unable to take on NHS patients because if he does so, the amounts he is allowed to charge mean that he is making a loss. That loss occurs because of staff and other costs, which will increase as a result of these measures. That will mean that the problem of getting dental care in the NHS, which is acute at present and even more acute for people with particularly severe orthodontic conditions, will get worse. He tells me, for example, that people can wait until their teenage years before they get treatment, and then they have to show that they have had treatment for the previous few years. If they have not had that, they are no longer eligible. The result is that people do not get treatment at all. Everyone knows that NHS dentistry is in crisis. As the noble Lord, Lord Scriven, pointed out, this will make it even worse.

Then we have the issue of the hospices. The noble and learned Lord, Lord Hope, mentioned the case of Cyrenians and I would be remiss if I did not. My noble friend Lady Goldie asked me to mention the letter that she received from that organisation, and the noble and learned Lord highlighted the fact that this will mean £171,000 extra for a charity—not a big one—which is struggling. When I was Health Minister in Scotland a million years ago, I introduced pound-for-pound funding for hospices, whereby the Government would match the funding raised by the hospices. That was hugely successful but subsequently repealed by the Scottish Parliament when it came into action. Hospices are organisations that we should be supporting. We should not be thinking of new taxes on the people that they have to employ, although of course they benefit from many volunteers.

The whole Bill is deeply misguided and, as the noble Lord pointed out, will have a devastating effect, not just on private providers but on all providers and charities. I remind the noble Lord that had we had his excellent amendment on the Floor of the House, we could have divided on it and sought the opinion of the whole House, but because we are put in here, we are unable to do so. That is a great disservice. Of course, it means that the Liberals—

[Lord Forsyth of Drumlean (Con)]

Well, I am not so sure about the “democrat”, but they are certainly called Liberal Democrats. They will be able to say, “We raised your concerns”, but they raised our concerns in a way that made it difficult to have the rules of engagement that would enable us to refine those amendments in Committee.

I hope that in considering his amendment, the noble Lord, if he takes it a stage further—I do not anticipate that the Government will accept it—may take account of the concern that it is not just about the public sector but the private sector. Bear in mind that this is just one measure on top of others—the increase in the minimum wage and the employment rights legislation—that will make it much more difficult for people to be flexible in their labour arrangements. All these things together are crushing these important public service organisations.

I support the amendment, but I hope that the noble Lord might think further on the contribution made by those private providers providing services to people who pay from their own pockets.

[Lord Scriven (LD)]

My amendment, in proposed new subsection (1B), says:

“A ‘specified employer’ means … a person providing a care home service”


under the Health and Social Care Act 2008. So that will cover a private care home, not just a public sector care home. Would the noble Lord agree?

[Lord Forsyth of Drumlean (Con)]

I would agree, but it would not provide for the costs of private patients, who are already paying over and above the odds because of the local authorities. I am not criticising the local authorities—in fairness to them, they simply do not have the money. More than three-quarters of councils’ budgets are going on social care, and the costs are going up. This is extending the cost, and therefore it will mean a greater burden on those people paying out of their own pockets.