Employer National Insurance Contributions
Debate between Alicia Kearns and Gareth Snell(2 weeks, 5 days ago)
Commons ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Alicia Kearns (Rutland and Stamford) (Con)
The Budget forced businesses to compromise on growth—those are the words of the CEO of the Confederation of British Industry. The OBR has said that the jobs tax will reduce wages by £7.5 billion and increase inflation. Both the OBR and the CBI say that it will result in higher prices, so it is no surprise that, over the past few weeks, my inbox has been full of local organisations that are gravely concerned about this £25 billion stealth tax. We are shocked, and they are heartbroken, because Labour promised not to raise national insurance. Indeed, the then shadow Chancellor called it a jobs tax, and said that Labour would never pursue such a thing.
Of the organisations that have written to me, which are the most worried? St Barnabas Lincolnshire, Lincolnshire and Nottinghamshire air ambulance, Uppingham GP practice and Stamford GP practice—the Royal College of GPs has said that it will cost 2.2 million appointments to service these increases—as well as the Vista (The Royal Leicestershire Rutland and Wycliffe Society for the Blind), local nurseries, my local citizens advice, and my care agencies and hospitality businesses have all written to me. As we approached Small Business Saturday, I had my independent shop competition, where around 100,000 votes were cast for the favourite local independent businesses, but those businesses are writing to me to tell me how worried they are. Family businesses are particularly worried. The tax will affect rural communities most of all, because they have smaller margins—they are already worried about farmers going out of business, on whom they are reliant—and we have small, symbiotic communities who support one another.
Gareth Snell (Stoke-on-Trent Central) (Lab/Co-op)
The hon. Lady is making an important point about the impact the changes will have on small businesses. In 2021, she voted for the Health and Social Care Levy Act 2021. I have checked Hansard, and she mentioned none of these concerns in 2021. That Act introduced an increase of 1.25 percentage points in national insurance for employers and employees. This is a smaller rise, and it protects employees. Can the hon. Lady say why all of a sudden she is now concerned, when three years ago she was not?
Alicia Kearns
The hon. Gentleman may not realise, but at that point we were just coming out of something called the pandemic, and it was a health and social care vote, so yes, I absolutely voted to do what we needed to do at that point in time. It was a specific levy to raise specific funds for our health and social care. I will happily stand behind that vote.
It is interesting, because this tax will make it harder for businesses to recruit; indeed, it will cost three times the price, at about £800 per employee. That is not how to get growth. It is how to lose staff as employers let people go; how to see increased demands on our welfare budgets; how to kill off our town centres; how to see hospices closed; and how to see local authorities ending up reducing services.