Oral Answers to Questions

Chris Law Excerpts

Tuesday 3rd December 2024 Commons Chamber

The Chancellor of the Exchequer was asked—

[Chris Law (Dundee Central) (SNP)]

1. If she will make an assessment of the potential impact of the National Insurance Contributions (Secondary Class 1 Contributions) Bill on the cost of delivering public services.

[Rebecca Smith (South West Devon) (Con)]

3. What assessment she has made of the potential impact of the proposed increase in employer national insurance contributions on public sector organisations.

[The Exchequer Secretary to the Treasury (James Murray)]

As we set out in the autumn statement, the Government have set aside funding to support the public sector with the additional cost of employer national insurance contributions. The amounts are £4.7 billion in 2025-26, £4.7 billion in 2026-27, £4.8 billion in 2027-28, £4.9 billion in 2028-29 and £5.1 billion in 2029-30. The Government plan to update Parliament on allocations by Department as soon as possible.

[Chris Law]

Labour’s national insurance increase will cost Dundee city council a minimum of £7.3 million, while across Scotland an additional £500 million will be incurred, rising to £750 million when indirect employers such as GP practices are included. Labour promised to reset the relationship with the devolved Administrations, so, ahead of Scotland’s Budget this week, will the Minister confirm that the full cost of the national insurance contributions increase to the delivery of public services in Scotland will be reimbursed?

[James Murray]

The funding for the impact on public sector organisations includes funding for the devolved Governments, which is allocated through the Barnett formula in the usual way. It is the responsibility of the devolved Governments to manage devolved workforces. Might I say that if the bill is somewhat higher in Scotland, that may be due to the Scottish Government’s decisions about the size of the public sector?