National Insurance Contributions (Increase of Thresholds) Bill

Baroness Ritchie of Downpatrick Excerpts

2nd reading
Wednesday 30th March 2022 Lords Chamber

[Baroness Ritchie of Downpatrick (Lab)]

My Lords, I thank the noble Baroness, Lady Penn, for presenting this technical Bill to the House today as a consequence of the Chancellor’s Spring Statement in the other place on Wednesday last week. I recognise that there are benefits to raising the threshold at which people pay national insurance—there are also requirements on employers—but we must remember that this Bill has more to do with the Chancellor’s increasingly desperate desire to paint himself as a tax-cutter than with a well thought-out package of measures to help people as they continue to face the cost of living increases. The Chancellor’s Spring Statement did not fundamentally deal with the rising cost of living or provide adequate mitigation measures.

Obviously, there are benefits to raising the threshold at which people pay national insurance but, set against that, we have the problem that people are facing astronomical increases in energy, inflation and food prices, and more people will be forced into food and fuel poverty and reliance on food banks.

I shall consider this from the point of view of the cost of living impact in Northern Ireland and the measures that the Government can provide to mitigate such impacts running alongside the NIC Bill. Although the purpose of the Bill is welcome, I would like more to be done by the Government to mitigate the rising cost of food, energy and other commodities as a result of Brexit, the war in Ukraine and the Covid-19 recovery.

In Northern Ireland, income levels remain lower than those in the UK as a whole: £506 per week compared to £547 per week in other regions of the UK. The after-housing cost figures are £473 for Northern Ireland and £476 for other regions of the UK. I am grateful for a recent report on poverty in Northern Ireland from the Joseph Rowntree Foundation, published just this month, which states:

“As Northern Ireland entered the pandemic, nearly one-in-five people in Northern Ireland lived in poverty, including over 100,000 children. With 1 in 14 households in food insecurity, the recent spike in energy prices, and wider inflation, as well as certain areas of Northern Ireland and groups such as people in workless families, disabled people, carers and people in ethnic minority households having much higher poverty rates, people across Northern Ireland need”


the Treasury, the Government here in Whitehall, working with a new Northern Ireland Executive, to go further—and we must be mindful of the fact that there might not be a Northern Ireland Executive in the post-election scenario. That must be taken on board.

We need a focus on the adequacy of the social security system: the need to reverse or partly mitigate the impact of the £20 per week cut to basic rates of universal credit and to match benefit uprating to the cost of living. Failing to do so will push 10,000 more families in Northern Ireland into poverty. In the longer term, we need to reform the welfare social security system to focus on people’s needs. A targeted payment could reduce child poverty. The role that the old DLA/PIP can have in helping disabled people into the labour market should be considered, including considering how the administration of the payments could be redesigned with dignity and poverty reduction at their heart.

We also need investment in the housing market, building more energy-efficient social housing to shorten waiting lists and provide good-quality affordable homes. We need to take action to provide targeted employability support to people struggling most to secure well-paid jobs, not least disabled people and single parents. We need to work with employers and the education and skills system to ensure that people are able to secure the skills that they need for the jobs of the future, not least the significant potential for jobs in transition to a low-carbon economy.

The Northern Ireland Executive fell some weeks ago, and it is important that the Government work with a potential new Northern Ireland Executive to build on the provisions in the Bill to mitigate the worst impacts of the cost of living increase in Northern Ireland. We must remember that due to there being no Executive, £300 million could not be released to the various government departments, which would have assisted those in poverty and most in need.

A colleague of mine in the Northern Ireland Assembly got cross-party support for a Private Member’s Bill to release this money, but the Bill was refused debate by the Speaker of the Assembly, which is totally unacceptable. In these circumstances, can the Minister tell us what additional legislative and other measures, running alongside this Bill, which I do not have a particular problem with, the Government will bring forward in forthcoming Budgets and in the Queen’s Speech to mitigate the impact of the rising cost of living, whether by inflation, price increases—in terms of food and other commodities—and energy prices? Energy prices are spiralling out of control and impacting the lives of people throughout Northern Ireland and probably the rest of the UK, and bringing new people into the poverty sector who, while hitherto poor, have not experienced such levels of deprivation.