Class 4 National Insurance Contributions

Debate between Lord Hammond of Runnymede and Oliver Letwin

Wednesday 15th March 2017 Commons Chamber

[Mr Hammond]

I have to say that that was an extraordinary contribution, because the hon. Lady cannot have it both ways or, to put it another way, have her cake and eat it. She wants me to adopt a broad interpretation of manifesto commitments and to adhere to it, and she wants me to protect the revenue base by addressing the difference in contribution treatment between the employed and the self-employed. I say to her, as I have just said to my right hon. Friend the Member for Loughborough (Nicky Morgan), that we will have to address that difference in due course. However, given the interpretation that is clearly out there of the manifesto commitment that was made, our priority now is to show that we will deliver on the spirit as well as the letter of that commitment, and we will not increase national insurance contributions in this Parliament.

[Sir Oliver Letwin (West Dorset) (Con)]

I am sure my right hon. Friend is right to deal with this issue in the round, but I hope he will not allow that in any way to deflect him from the very sensible Budget judgment he made in respect of fiscal neutrality or from the need for the structural reforms he is putting forward. Did he notice, as I did, that the shadow Chancellor asked him to fill the gap without reducing spending or increasing taxes? Does he know how that could be fulfilled?

[Mr Hammond]

The straight answer to my right hon. Friend is that only in the la la land that the Labour party occupies is that trick possible. Of course, my right hon. Friend is right to draw attention to the issue, and I emphasise again my commitment in this Budget to fiscal neutrality—the right hon. Member for Hayes and Harlington, of course, does not believe in fiscal neutrality.