National Insurance Contributions Increase

Debate between Rachel Reeves and Oliver Heald

Tuesday 8th March 2022 Commons Chamber

[Rachel Reeves]

Politics is about choices; the hon. Lady makes an important point. This Government are making the choice to increase taxes on ordinary working people and those who employ them, while on the Opposition Benches, we say that those who have benefited from the high energy prices should pay a bit more in tax to relieve the pressure on ordinary working people. We have a Conservative Minister who goes on the TV and radio and says that energy companies and the North sea oil and gas companies are struggling right now. Tell that to my constituents, the hon. Lady’s constituents and all our constituents who are struggling to pay the bills, while the profits keep coming in for the big oil and gas producers.

[Sir Oliver Heald (North East Hertfordshire) (Con)]

Does the hon. Lady not agree that what she is saying is all smoke and mirrors? If a tax is put in for one year, that will not pay for the continuing costs over future years. What she is doing is simply misleading the public.

[Rachel Reeves]

If we raised those taxes now on North sea oil and gas companies, we could bring in money that could be used to relieve pressure now. I think that the right hon. and learned Gentleman’s constituents in North East Hertfordshire would be pretty pleased to have money off their bills this year, rather than the buy now, pay later scheme that we get from this Chancellor.

Why is the Chancellor not listening? The Conservatives’ rise in national insurance will hit almost 30 million working people. The TUC rightly argues that it is wrong to hit young and low-paid workers while “leaving the wealthy untouched”. The British Chambers of Commerce describes the Government’s policy as

“a drag anchor on jobs growth”.

The CBI put it bluntly and said that it will

“hurt a business’s ability to hire staff”.

On Sunday, the Federation of Small Businesses warned:

“Slamming small firms with a jobs tax hike will put the brakes on investment, upskilling and growth within communities most affected by the pandemic.”

The Chancellor must know what business organisations and trade unions are saying. We can only conclude that he is consciously disregarding their experience and views. We know from research by the National Institute of Economic and Social Research that job-intensive sectors will be disproportionately hit hard. The Conservatives have deliberately designed a tax hike that will hit people working in hotels, restaurants, transport, retail and wholesale especially hard.