Draft Social Security (Contributions) (Rates, Limits and Thresholds Amendments and National Insurance Funds Payments) Regulations 2022 Draft Tax Credits, Child Benefits and Guardians Allowance Up-rating Regulations 2022

Barry Sheerman Excerpts

Tuesday 22nd February 2022 General Committees

[Lucy Frazer]

These regulations set the national insurance contribution limits and thresholds as well as the rates of a number of national insurance contributions for the 2022-23 tax year, and make provision for a Treasury grant to be paid into the national insurance fund if required. As Members are aware, national insurance contributions or NICs are a key element of the nation’s welfare safety net, helping to support workers through ill health, unemployment and old age. They allow people to make contributions when they are in work in order to receive contributory benefits when they are not working. NICs receipts go towards funding contributory benefits as well as the NHS.

As announced at the Budget, the Government are using the September consumer prices index figure of 3.1% as the basis for setting all national insurance limits and thresholds and the rates of class 2 and 3 national insurance contributions for 2022-23. September CPI is the standard measure to increase NICs thresholds and class 2 and 3 rates. I will first outline the specific changes to the class 1 primary threshold and class 4 lower profits limit. The primary threshold and lower profits limit indicate the point at which employees and the self-employed start paying class 1 and class 4 NICs respectively. These thresholds will rise from £9,568 to £9,880 per year. The rates of class 1 and 4 NICs are unchanged by these regulations. The rates of class 1 and 4 NICs have already been increased, to 13.25% and 10.25% respectively, through the Health and Social Care Levy Act 2021. Increases to the primary threshold and lower profits limit do not impact on state pension eligibility. This is determined by the lower earnings limit for employees, which will increase, in line with CPI, from £6,240 in 2021-22 to £6,396 in 2022-23. I will come shortly to payment of class 2 NICs for the self-employed.

The upper earnings limit, the point at which the main rate of employee NICs drops to 3.25%, is aligned with the higher rate threshold for income tax. It was announced at spring Budget 2021 that the income tax higher rate threshold and the upper earnings limit would remain frozen at £50,270 until 2025-26. Similarly, the upper profits limit is the point at which the main rate for class 4 NICs drops to 3.25%. This will also remain at £50,270 per year.

As well as class 4 NICs, the self-employed pay class 2 NICs. The rate of class 2 NICs will increase from £3.05 in 2021-22 to £3.15 in 2022-23. The small profits threshold is the point above which the self-employed must pay class 2 NICs. This will increase from £6,515 in 2021-22 to £6,725 in 2022-23.

Class 3 NICs allow people to voluntarily top up their national insurance record. The rate for class 3 will increase, in line with inflation, from £15.40 a week in 2021-22 to £15.85 in 2022-23. The secondary threshold is the point at which employers start paying employer NICs on their employees’ salary. That threshold will increase from £8,840 in 2021-22 to £9,100 in 2022-23. The threshold at which employers of people under 21 and apprentices under 25 start to pay employer NICs on those employee salaries will remain frozen at £50,270 per year, to maintain alignment with the UEL.

The regulations also make provision for a Treasury grant of up to 17% of forecast annual benefit expenditure to be paid into the national insurance fund, if needed, during 2022-23. A similar provision will be made in respect of the Northern Ireland national insurance fund. A Government Actuary’s Department report laid alongside the re-rating regulations forecast that a Treasury grant will not be required in 2022-23, but in view of the economic challenges created by the covid pandemic, the Government consider it prudent to make the maximum provision at this stage. I trust that is a useful overview of the changes we are making to adjust contributions to the Exchequer in line with inflation.

On the second statutory instrument, the Government are committed to delivering a welfare system that is fair for claimants and taxpayers, while providing a strong safety net for those who need it most. The draft regulations will ensure tax credits, child benefit and guardian’s allowance increase in line with the consumer prices index, which measured inflation at 3.1% in the year to September 2021.

[Mr Barry Sheerman (Huddersfield) (Lab/Co-op)]

Some of us have not seen this statutory instrument. I was only given one when I came in. I did not realise there were two statutory instruments.

[The Chair]

By all means, help yourself, Barry, but do not interrupt the Minister as she is in full flow.

[Mr Sheerman]

I am sorry, I did not mean to interrupt.

[The Chair]

You are a young Member, and experience helps.

--- Later in debate ---

[Mr Sheerman]

On a point of order, Sir Gary, I want to put the record straight. I was not here when Lloyd George originally introduced the national insurance legislation.

[The Chair]

So you say.

--- Later in debate ---

[Lucy Frazer]

In my introductory remarks, I set out how each threshold will be increased, but I am happy to set that out in writing to him. He also spoke about the steps we are taking to protect the most vulnerable. He will know that, last September, we put in place a support package of half a billion pounds to support the most vulnerable. He will have heard the Chancellor’s statement only last month about the steps we are taking in response to the energy price increases. He will also be aware of the £400 billion support provided by the Chancellor in the past two years.

The SIs before us are important to ensure that we continue to uprate the thresholds.

[Mr Sheerman]

I do not want to extend the debate to excession because I know that we are in a hurry on account of Divisions in the House, but a Government Minister—a colleague of the Minister—has just resigned from the Government because of the amount of fraud that has been allowed to happen in our country under the present Chancellor’s guidance. Indeed, it was his legislation. Will the Minister confirm that £3.4 billion was lost? What could we have done with that £3.4 billion to ameliorate the impact of the NIC increase?

[The Chair]

That is not really within the scope of the SIs, so the Minister does not need to respond to that, but I think another intervention is coming.

[Mr Sheerman]

I am sure that the Minister can say something to us.

[The Chair]

Say something nice to Barry Sheerman please, Minister.

Economic Update

Barry Sheerman Excerpts

Thursday 3rd February 2022 Commons Chamber

[Rishi Sunak]

I am always happy to meet my hon. Friends from Stoke, which benefited from not just one, not just two, but three successful levelling-up fund bids, and which I was pleased to visit recently. My hon. Friend is right and he is, rightly, a proper champion for the ceramics sector in this House. I enjoyed meeting representatives from that sector on my recent visit and I would be happy to meet him and them to discuss the situation further.

[Mr Barry Sheerman (Huddersfield) (Lab/Co-op)]

We all know that the Chancellor is a fast-talking, slick operator who knows how to keep his head down when it is useful, but as someone who has been in the House since 1979, he is the most incompetent Chancellor that I have ever seen. When children go to bed—[Interruption.] He does not like it, but when children in my constituency go to bed with no food in their tummies and no heat in their homes, what does he think is the honourable position of a Chancellor who has just allowed £4.3 billion to be taken in fraud from one of his direct policies under his watch? Any other Chancellor that I have known would have come to the House today to resign.

[Rishi Sunak]

I will let this Government’s record on economic policy speak for itself. It is a record of which I am proud. I can provide the hon. Gentleman with the reassurance that I and the Government remain committed to tackling fraud wherever we see it. He mentioned the figure of £4.9 billion. As I said to the House in oral questions on Tuesday, that estimate has already been reduced by a third—by £1.6 billion—because of the actions that we are taking. I will not go into them all now, but he should know that we will go after everyone wherever we can to recover that money for the taxpayer, and I am confident that we will do a very good job.

Oral Answers to Questions

Barry Sheerman Excerpts

Tuesday 1st February 2022 Commons Chamber

[Mr Clarke]

I am afraid the hon. Gentleman confuses what he is talking about. The fact that we have not hit the target is precisely a reflection of the fact that the wider economic recovery has been so strong. It is a measure of the success of the wider recovery that we simply do not need to offer those opportunities and that the regular economy is generating them.

[Mr Barry Sheerman (Huddersfield) (Lab/Co-op)]

I have heard from so many on the Government Benches how good the kickstart scheme is. It has huge potential, but I keep telling the Treasury Bench to get their finger out and get on with it. It needs to be bigger and better; it must be linked to green skills and real opportunities for getting young people to roll up their sleeves and work in the community. It could be backed by a windfall profit tax on supermarkets and others, or on the gambling industry. Get on with it!

[Mr Clarke]

We are getting on with it. I remind the hon. Gentleman that when we compare the scheme to the last Labour Government’s future jobs fund, we see that we have already comfortably exceeded the number of young people it supported into work. Those are good, well-paying jobs in sectors that, he rightly highlights, are some of those of the future.

Downing Street Christmas Parties Investigation

Barry Sheerman Excerpts

Thursday 9th December 2021 Commons Chamber

[Michael Ellis]

I am sorry that the hon. Gentleman experienced the personal effect of the pandemic that he has described to the House and I am sorry that he missed out on the birth of his child. He asked about the nature of the people who attended any gathering. That is exactly what the investigation will establish—whether there was a gathering, the nature of it, the scope of it, any attendees and so on. That is exactly what it will be all about and the hon. Gentleman will hear the result in due course.

[Mr Barry Sheerman (Huddersfield) (Lab/Co-op)]

Does the Paymaster General agree that the one person who has come out of this with any shred of integrity is Allegra Stratton? I have known Allegra for many years. She is a first-class journalist, a woman of honour and a very nice person, and I am sure that she would not have agreed to the description “a gathering in the attic”. She is a woman of integrity, and I admire the fact that she had the honesty to resign yesterday.

[Michael Ellis]

I thank the hon. Gentleman for saying that. It was, if I may say so, characteristically generous of him. I do not personally know Ms Stratton, but I am absolutely sure that he is right. She was clearly mortified yesterday, and extremely upset by what has happened.

We all, in our day-to-day lives, seek to do the best we can to represent our constituents and serve in the public interest. I know the hon. Gentleman has done that for many years, and I thank him for it.

Finance (No. 2) Bill

Barry Sheerman Excerpts

Committee stage
Wednesday 1st December 2021 Commons Chamber

[Dame Margaret Hodge]

Thank you, Dame Rosie; I have not, because I did not realise that there would be so few people in the House this afternoon that I would have the opportunity to do so.

What I can say is that 24 Members of Parliament—all of them Conservative Members, many of them Front-Bench Members, some of them with ministerial positions—have received money from Aquind or from Alexander Temerko. I can also tell the House that further parties have received such money and that some former MPs and local parties have received money. I hope that is in order, and thank you for correcting me, Dame Rosie. The impact of economic crime and economic activity on our politics is a worrying trend that has been growing exponentially over recent years.

[Mr Barry Sheerman (Huddersfield) (Lab/Co-op)]

I am listening with rapt attention to my right hon. Friend’s remarks. Does she not think it strange that there is a Member of the House of Lords with very close connections to Russia—indeed, he is a Lord of Hampton and of Siberia—but we never hear from him and he is never seen? Whatever the story is of great interest in Russia, he is never on the media in this country.

Oral Answers to Questions

Barry Sheerman Excerpts

Tuesday 7th September 2021 Commons Chamber

[Mr Barry Sheerman (Huddersfield) (Lab/Co-op)]

When I was a very young MP, a Conservative Prime Minister introduced a windfall profit tax on the banks. When will this Administration and this Chancellor of the Exchequer have the imagination and leadership to introduce a windfall profit tax on those who have done very well over the last few years, and put it into green apprenticeships, green training and green skills, and do it now?

[Rishi Sunak]

Talking about young people and financial services, I was recently in Glasgow talking about young people starting exactly what the hon. Gentleman described: new apprenticeships in the financial services industry, growing in Glasgow, supported by this Government who have put more money behind apprenticeships than any previous Government.

Future Relationship with the EU

Barry Sheerman Excerpts

Thursday 10th December 2020 Commons Chamber

[Penny Mordaunt]

My hon. Friend understands these issues very well and makes those points very well. He will also understand the Prime Minister’s resolve on this issue. I can reassure him that, with the exception of the scallops and that very fine piece of turbot, fish was not on the table last night.

[Mr Barry Sheerman (Huddersfield) (Lab/Co-op) [V]]

I get on well with the Minister, but I must tell her this morning that it is our duty to hold this Government to account at this crucial time for all our constituents. That being said, being creative and determined is all very well, and I have been impressed by the negotiating skills of the two men leading this over these weeks, as I sit on the Committee on the Future Relationship with the European Union, but this is about leadership. As soon as the Prime Minister gets his sweaty hands on this issue, there is failure—failure of leadership, failure of determination and failure really to deliver this Government’s message. I hope the Minister comes back on that.

[Penny Mordaunt]

I thank the hon. Gentleman for the kind remarks that he makes about our negotiating team. They have done an incredible job. It is an incredibly technical job, with many details to work through, and their respective teams have done an incredible job. We owe them an immense debt of gratitude, whatever the outcome of these negotiations.

The hon. Gentleman is absolutely right: it is the job of Members of Parliament to hold the Government to account. We will always be here, whether it is on an urgent question or other matters. Again, I should plug that I am available at 10 am every day to take calls from Members of Parliament on any issue, whether it is Brexit or covid-related. But I would just say to him: please do not misinterpret the Prime Minister’s determination on sticking to these fundamental principles as somehow a negative in these negotiations. The only way we are going to get any arrangement that will enable our country to thrive is if he sticks to his guns, and he is going to stick to his guns.

UK-EU Future Relationship Negotiations and Transition Period

Barry Sheerman Excerpts

Monday 7th December 2020 Commons Chamber

[Penny Mordaunt]

I can give my hon. Friend those assurances. The Prime Minister has been very clear on this point, and it is something that the EU negotiating team will be fully apprised of.

[Mr Barry Sheerman (Huddersfield) (Lab/Co-op) [V]]

The Minister might know that I am a member of the Select Committee on the Future Relationship with the European Union, which will be abolished next week. As a member of that Committee, I have witnessed the sheer incompetence of the Government’s leadership. On Small Business Saturday this weekend, a businesswoman said to me, “We have suffered 1,000 cuts in the last year from covid. Why would any Government inflict another 1,000 cuts by coming out of Europe on the wrong terms, in the wrong way?”

[Penny Mordaunt]

What would be damaging for business is more prolonged uncertainty. Our businesses, as we have seen especially over the past year, are incredibly resilient and can cope with all sorts of things. What they cannot cope with is every eventuality as opposed to any eventuality. We need to give them certainty. I hope that we will soon be able to inform them of the remaining issues that the negotiating teams are working on. That will provide them with 100% clarity about the situation that they are facing. We will continue to support them to get ready for the transition.

Oral Answers to Questions

Barry Sheerman Excerpts

Tuesday 1st December 2020 Commons Chamber

[Matthew Pennycook (Greenwich and Woolwich) (Lab)]

What fiscal steps he is taking to help achieve a net zero carbon economy.

[Mr Barry Sheerman (Huddersfield) (Lab/Co-op)]

What steps he is taking to ensure that his fiscal policy incentivises environmentally positive behaviour.

[The Exchequer Secretary to the Treasury (Kemi Badenoch)]

The Chancellor’s announcement at the spending review will help us meet our net zero 2050 target by providing the right incentives for individuals and businesses. The spending review commits £12 billion of public investment, kick-starting our transition to net zero and boosting the UK’s global leadership on green infrastructure and technologies ahead of COP26 next year. It also included funding that will encourage protection of the natural environment, including for planting trees, restoring peatland, creating natural habitats and investing in national parks.

[Kemi Badenoch]

The hon. Gentleman will know that this has been the subject of negotiations, which are still ongoing. We legislated for a UK-linked ETS as well as a carbon emissions tax, and we will be announcing shortly which of those options we will be taking. We know that a UK-linked ETS is the preferred option at the moment, and that is the one that we are currently hoping we will be able to negotiate for during this period.

[Mr Sheerman [V]]

Everyone in the House knows that the Chancellor of Exchequer does not like green waffle, so may I challenge the Front-Bench team to stop the rhetoric and start producing policies? We already have an Agriculture Act that says we should have public money for public good; what about public money for environmental good? Let us have the taxation—the systems—that they have already introduced in the Nordic countries, but for goodness’ sake let us get on with it.

[Kemi Badenoch]

The hon. Gentleman asks an interesting question and I believe we are getting on with it. The Prime Minister’s 10-point plan, announced just two weeks ago, outlines quite a lot of that. If the hon. Gentleman is talking about the costs, he should look at the announcement we made about the net zero interim review, which will be coming out before the end of the year. That will look at the options for a balance of contributions between households, businesses and the taxpayer, and how to maximise economic growth opportunities from the transition to net zero.

Spending Review 2020 and OBR Forecast

Barry Sheerman Excerpts

Wednesday 25th November 2020 Commons Chamber

[Rishi Sunak]

My hon. Friend is right that it is about making difficult decisions so that we can prioritise the things that our constituents want us to. In his area, he will be pleased that there has been a success in accessing the new stations fund for Haxby station. That is an example of the Government delivering on our promises and trying to find ways to improve local transport infrastructure in his local area to drive growth and opportunity. We will relentlessly focus on those types of priorities.

[Mr Barry Sheerman (Huddersfield) (Lab/Co-op) [V]]

I ask the Chancellor of the Exchequer whether we can have the new infrastructure bank in Yorkshire, in particular in Huddersfield. Is he sure that he has paid enough attention to the tremendous challenge of young people’s unemployment and young people who want to get into a job and be trained? Is the programme that he announced today sufficient to train a whole new generation of young people as green apprentices?

[Rishi Sunak]

I would, of course, be sympathetic to the idea of putting the bank in Yorkshire, as the hon. Gentleman knows, but he was slightly beaten to the punch over the weekend by my hon. Friend the Member for Shipley (Philip Davies), who made a pitch for Bradford. In any case, I will happily hear his thoughts.

The hon. Gentleman is right about the focus on young people. The new Restart programme will be able to help a million people who have been unemployed for over a year. Before that happens, we have the kickstart programme that will benefit a quarter of a million young people—or more if it is successful. He talked about apprenticeships. Rightly, we have increased the cash bonus to businesses to £3,000 for them to take on a fresh new young apprentice, because he is right that that is where our focus should be.