Health and Social Care Levy Bill

James Murray Excerpts

2nd reading
Tuesday 14th September 2021 Commons Chamber

[James Murray (Ealing North) (Lab/Co-op)]

I beg to move an amendment, to leave out from “That” to the end of the Question and add:

“this House declines to give a Second Reading to the Health and Social Care Levy Bill because, notwithstanding the need to increase funding for health and social care, the Bill raises money for an approach announced by the Government that fails to set out a plan to fix the crisis in social care, improve pay and conditions for social care workers, or clear the NHS waiting list backlog by the end of this Parliament, while breaking the Prime Minister’s promise that no one will have to sell their home to pay for care; because it lacks a guarantee that Parliament will vote on a social care plan before spending the money it raises; and because it breaks the Government’s promise not to increase National Insurance, raising taxes on employment that will disproportionately hit working families, young people, those on low and middle incomes and businesses trying to create more jobs in the wider economy, whilst leaving income from other sources untouched.”

Today, the Government are pushing through a new tax on working people and their jobs. All scrutiny by the House of Commons of the Government’s manifesto-breaking plans has been squeezed into a single day. As Conservative Members have said, we have just a few hours of scrutiny on this entire Bill, just one week after the Government first revealed their intentions. Why the sudden rush? The truth is that the Prime Minister and the Chancellor are desperate to avoid giving their own side enough time to push back. They want to make sure that, by the time it sinks in with their own MPs what a mistake this tax rise is, it will be too late for their Back Benchers to mount any opposition.

Perhaps it is also sinking in with Conservative Back Benchers that the Prime Minister and the Chancellor are pushing through these plans for a tax rise without having a plan for social care. If we are to believe the Prime Minister, and there is absolutely no reason why we should, he had a plan for social care two years ago. We are still waiting to see it. All we have today is a tax rise for working people and for businesses that are creating jobs.

[Catherine West]

Does my hon. Friend agree that these problems began in 2010? The NHS’s satisfaction rate in 2009 was 80%, and now it is way lower. In fact, they might have got rid of all the satisfaction surveys so that we do not know what people really think.

[James Murray]

My hon. Friend makes an important point about the Conservative Government’s impact on the national health service over the last decade, running it into the ground and leaving it in such a state when the covid pandemic hit.

As my hon. Friend the Member for Leeds West (Rachel Reeves), the shadow Chancellor, said last week:

“There are two tests for the package announced yesterday. First, does it fix social care? Secondly, is it funded fairly?”—[Official Report, 8 September 2021; Vol. 700, c. 327.]

Looking at the Bill, it is clearer than ever that the answer to both those questions remains a resounding no.

[Gary Sambrook (Birmingham, Northfield) (Con)]

On the basis of those two tests, which tax would the hon. Gentleman increase to pay for social care?

[James Murray]

We are clear that taxes will have to rise to pay for social care, but we are also clear that this increase in national insurance contributions is not the way to raise the money fairly. When it comes to funding the NHS, social care and all our public services, we are clear that those with the broadest shoulders should be asked to contribute more.

This five-page Bill contains nothing at all about a plan to fix social care; it does not even mention a plan. Put simply, there is no guarantee that a plan for social care will be in place even when the levy comes into force.

[Debbie Abrahams (Oldham East and Saddleworth) (Lab)]

I was going to pose this question to the Minister, but he would not take my intervention. Last week I was told by the insurance arm of a major bank that the Government are actively encouraging it to produce insurance products specifically for health and social care. Is my hon. Friend as concerned as I am not only about who is encouraging such developments but about what it means for the acceleration of privatisation not only in social care but in the health service?

[James Murray]

My hon. Friend makes us think about what we have read recently about what the hon. Member for Yeovil (Mr Fysh) has been saying about a rebate from this tax for those who take out private insurance. Make no mistake, that is a slippery slope towards a two-tier healthcare system.

[Dr Andrew Murrison (South West Wiltshire) (Con)]

The hon. Gentleman has been speaking for some time, but he has not said what taxes he would raise. Why was it okay for Labour to raise national insurance to pay for healthcare in 2003, when there was not a pandemic and we did not have the scale of social care need that we have today? If it was right then, why is it not right now?

[James Murray]

The right hon. Gentleman speaks about a tax rise 20 years ago, following a decade of wage growth, and it came with a plan for how the money would be invested. In stark contrast, this Government’s tax rise hits working people after a decade of stagnating wages, after we have been hit by a global pandemic and after years during which where people get their money from has changed. Above all, the Conservatives’ tax rise comes with no promise that it will clear the NHS waiting list backlog in this Parliament and no promise that any money will be seen by the social care sector.

Despite all that has been said, there is no guarantee in the Bill that social care will benefit from the Government’s tax rise. In fact, the Bill explicitly rules out any money going towards social care in the first year, and there is nothing to guarantee that a single penny of this new levy will ever go into the social care sector.

The Association of Directors of Adult Social Services realises this, and it said on Monday that

“it is not clear that there is any new money for adult social care to help improve care and support from April 1st next year… It will not add a single minute of extra care and support, or improve the quality of life for older people, disabled people and unpaid carers.”

As the association rightly points out, this could leave councils with no option other than to raise council tax. Indeed, the Government have admitted that they expect councils to cover increasing need and rising costs. Despite £8 billion having been cut from local council care budgets by a decade of Conservative Government, there is no money for councils that need it now.

In truth, this levy does not set out to fix the crisis in social care. It seeks only to be a political fix for the Prime Minister. I suspect Conservative Members know that, and I suspect the Prime Minister is noticing that his attempt at a political fix is quickly becoming a political headache.

Although some Conservative Members may be worried about how to explain to their constituents that they have broken their manifesto promise and still failed to fix social care, others have a different agenda. The hon. Member for Yeovil, as I mentioned earlier, has been reported as saying that he wants people with private social care insurance to get a rebate from the new tax. As my right hon. Friend the Member for Leicester South (Jonathan Ashworth), the shadow Health Secretary has said, this looks very much like a “slippery slope” towards a two-tier healthcare system and privatisation.

[Mr Marcus Fysh (Yeovil) (Con)]

My comments have been misreported. The origins of the Labour movement and the Liberal movement are in trade unions, co-operatives and friendly societies that came together to look after each other. What I am suggesting is that we get money into such systems to help people look after and pay for themselves in older age. There are myriad ways in which the system can be made much more progressive, and I am on their side in trying to make this more progressive than it is at the moment.

[James Murray]

As the hon. Gentleman is on our side, I look forward to him joining us in the Lobby this evening.

Will the Chief Secretary to the Treasury or the Financial Secretary to the Treasury put it unequivocally on the record that no rebate from the health and social care levy for those with private insurance will ever be entertained? A two-tier healthcare system is the very last thing we need. What the social care sector desperately needs is guaranteed funding and a plan to transform the sector. This Bill delivers neither.

[Craig Mackinlay (South Thanet) (Con)]

The hon. Gentleman is talking about a two-tier system. Is he saying that the millions of people in the public sector and the not-for-profit sector who have auto-enrolled pensions are rather daft to have a sensible pot under their own name, with the flexibility that it brings? Are you calling millions of taxpayers daft?

[Madam Deputy Speaker (Dame Rosie Winterton)]

Order. The hon. Gentleman is experienced enough to know that he should not speak directly to another Member.

[James Murray]

The hon. Member for South Thanet (Craig Mackinlay) knows full well that his question is not relevant to this discussion. We are talking about the NHS and the social care system, and we need reassurance from Ministers that they will not entertain a two-tier healthcare system on the back of comments made by Conservative Members.

We need to transform social care into the service that people want, need and deserve, which is why our plan for social care would include: enshrining the principle of home first; making a fundamental shift in the focus of support towards prevention and early intervention; getting care workers the pay, terms and conditions they deserve—at the very least, a real living wage of £10 an hour—while transforming training to improve the quality of care; and, crucially, making sure that England’s 11 million unpaid family carers get proper information, advice, breaks and the workplace flexibility they need to balance work and caring responsibilities.

Of course, today we are not discussing how to transform social care. We are debating a Bill that introduces a tax rise that may never go towards helping social care, and one that is raised on the backs of working people and businesses that are creating jobs.

[Dame Andrea Leadsom (South Northamptonshire) (Con)]

What would the hon. Gentleman do about the backlog of 5 million people, as a result of covid, waiting for procedures and operations in the NHS? Does he not want that backlog to be dealt with?

[James Murray]

The right hon. Lady raises points about the backlog in the NHS. We have had 10 years of a Conservative Government, of whom she has been a key part. She is responsible for the backlog, along with all her colleagues on the Conservative Benches. They should take some responsibility for the mess they have caused.

We know that social care desperately needs more funding, but are the Government raising taxes for those with large portfolios of stocks and shares? No. Are they increasing taxes on landlords who rent out multiple properties? No. Are they going further to tackle large online multinationals that shift their profits overseas? No. The Government have gone for a tax rise on working people and businesses creating jobs.

Last week, the Government tried to soften the blow by claiming that their tax plans are fair because this tax rise on working people is accompanied by a tax rise on dividends. So where is the tax rise on dividends? The Government’s proposal documents last week admitted that that might be legislated for in the next Finance Bill, and indeed there is nothing on raising taxes on dividends in the Bill in front of us today. They are pulling out the stops to increase taxes on working people as quickly as possible, ramming this legislation through in one day, but when it comes to dividends and a tax that the Prime Minister acknowledged last week would affect

“better-off business owners and investors”—[Official Report, 7 September 2021; Vol. 700, c. 154.]

suddenly there is no rush. Let us not fall for the claim that the dividend tax rise will make the Government’s proposals fair. The dividend tax—if it ever happens; we have only the Prime Minister’s word for that, after all— would raise only 5% of the total revenue. Some 95% of the tax bill would land on employment.

If we want to understand the impact of this tax rise on people and their jobs, let us start by looking at the Government’s own view. Their own tax information and impact note on this tax rise was signed off personally by the Financial Secretary to the Treasury and published on 9 September—curiously, this was a couple of days after the Government’s proposals were announced. It says in no uncertain terms:

"There may be an impact on family formation, stability or breakdown as individuals, who are currently just about managing financially, will see their disposable income reduce.”

Five years ago, the Prime Minister’s predecessor began her time in office claiming to be an ally for people who are “just about managing”. Now we have the Government’s own report admitting that they are the ones who will suffer.

The report is blunt too about the impact of this tax rise on businesses. It makes it clear:

“Behavioural effects are likely to be large, and these will include...business decisions around wage bills and recruitment.”

It is there in the Government's own analysis: this will be a tax blow to jobs and wages. Others agree, with the chair of the Federation of Small Businesses saying last week:

“Breaking a manifesto promise by increasing National Insurance Contributions just at the moment when firms are struggling to get back on their feet would be devastating for small businesses and the local communities they serve...If this hike happens, fewer jobs will be created by the UK’s small business community over the crucial months ahead.”

The British Chambers of Commerce agrees, warning:

“A rise in National Insurance Contributions would represent a hammer blow to jobs growth at this crucial point in the UK's economic recovery.”

The CBI president said:

“National Insurance increase will directly hurt a business’s ability to hire staff, at a time when businesses have faced a torrid 18 months and are now fighting crippling labour shortages.”

Do the Financial Secretary and the Chief Secretary think the Federation of Small Businesses, the British Chambers of Commerce and the CBI are all wrong? Perhaps the Financial Secretary will get up to tell me the answer to that. [Interruption.] Sorry, I thought the Financial Secretary was keen to get to his feet to respond to my question. He does not want to, no. He does not want to answer whether he thinks the FSB, the BCC and the CBI are all wrong. Do other Members from his party think they are wrong?

[Andrew Griffith (Arundel and South Downs) (Con)]

rose—

[James Murray]

Perhaps the hon. Gentleman would like to intervene to answer that question.

[Andrew Griffith]

I am just wondering whether the hon. Gentleman’s tax primer in low corporate taxes has enlightened him with any ideas of his own as to how his party would propose to fund this. The proposal on the table is a broad-based tax. How would he fund this?

[James Murray]

We have been absolutely clear that when it comes to funding the NHS and social care, those with the broadest shoulders should pay the most. The idea that this is a “broad-based” tax rise is completely wrong. The hon. Gentleman knows that, we know that and the British public know that. I note that when he got to his feet, he did not answer the question as to whether he thought the FSB, the BCC and the CBI are all wrong. Next time another Conservative Member gets to their feet, I would like to hear their answer to that. I would also like to know whether they think TUC general secretary Frances O’Grady was wrong when she said last week:

“We know social care needs extra funding. But the prime minister is raiding the pockets of low-paid workers, while leaving the wealthy barely touched.”

That is the fundamental unfairness at the heart of this Government’s tax rise.

The Prime Minister and Chancellor are desperate to pretend this is the only way to raise the money, but that simply is not true. A fairer approach would see funding for the NHS, social care and all our public services borne by those with the broadest shoulders—this would include those with incomes from large financial assets, multiple rental properties, and other income from wealth contributing more. But they have not been considered by this Government, who would prefer to hit workers instead.

This Government are landing a tax rise, which they claim will go toward social care, on low-paid social care workers themselves. The truth is that this is a tax on working people and their jobs. This tax rise tells us nothing about how the Government plan to fix social care, but it tells us everything we need to know about the instincts of the Tories when they are in power. That is why it is wrong. That is why we will be voting against this Bill. And that is why Conservative MPs would do well to join us tonight if, come the next election, they want to be able to look their constituents in the eye.

Health and Social Care Levy Bill

James Murray Excerpts

Committee stage & 3rd reading
Tuesday 14th September 2021 Commons Chamber

[Mr Deputy Speaker (Mr Nigel Evans)]

I would just like an indication of who will want to make independent speeches by bobbing—thank you.

[James Murray]

As we turn to the Bill’s Committee stage, I will address the new clauses tabled in my name and the name of my hon. Friend the Member for Erith and Thamesmead (Abena Oppong-Asare).

We know that social care desperately needs more funding and the Government claim that their Bill today will help to raise some of that money, but the truth is that there is nothing in this Bill that will guarantee a penny going towards social care. I will return to that point when I address new clause 6, but first I want to look at the core measure that this Bill introduces—the unfair tax rise on working people and their jobs. Our new clause 3 would require the Government to report to the House of Commons on the impact that the Bill will have on tax revenue derived from different sources of income. On the one hand, there is income from employment and self-employment, which the Government have chosen to tax hard. On the other hand, as new clause 3 mentions, there is income from dividends, rental properties and other sources of wealth, which the Government have left untouched. We know that the Government have chosen not to raise taxes for those with large portfolios of stocks and shares, and for landlords renting out multiple properties, but the Bill even lacks any mention of taxes on dividends, despite the Prime Minister saying that they would be taxed more. Perhaps when the Financial Secretary to the Treasury responds, he could explain why the Government have chosen to delay implementing a tax rise in dividends until the next Finance Bill or beyond. Will he give us his word that the increase in tax on dividends will definitely go ahead?

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[Dr Dan Poulter (Central Suffolk and North Ipswich) (Con)]

I am someone who has believed in getting cross-party consensus on the future of social care funding, and who has been calling for a health and social care levy since 2016. Does the hon. Member recognise that there has actually been cross-party consensus on this issue, and that the shadow Care Minister, the hon. Member for Leicester West (Liz Kendall), called for a health and care levy in 2018? How does he reconcile that with his comments just now?

[James Murray]

Let us be really clear about what the shadow Care Minister, my hon. Friend the Member for Leicester West (Liz Kendall), proposed, because it was entirely different from what is being discussed now. She proposed that the tax should be raised from unearned income, and that it should be progressive and fair between generations, which fundamentally differentiates it from what we are discussing today. If the Government had truly sought to build cross-party consensus, does the hon. Gentleman not think that they would have done better to take some time over the Bill, rather than rushing it through within a week of the proposals first being announced, with limited ability for scrutiny and without any discussion of cross-party consensus about how to proceed?

[Dr Poulter]

Will the hon. Member give way?

[James Murray]

I am going to make some progress now; I have given way to the hon. Gentleman already.

As I said, although new clause 8 has not been selected today, I hope that Government Back Benchers have seen it on the amendment paper and will perhaps raise the matter with their colleagues on the Front Bench.

I hope, however, that there will be a vote this evening on new clause 5, and I urge Government Members to join us in voting for this crucial review of how the Bill will make inequality worse. We know how widespread and deep rooted inequality has become in our country. The latest bulletin from the Office for National Statistics on household income inequality in the UK for the financial year ending 2020 confirms what we all know: the income gap between the richest in society and the rest of the population has widened over the last decade. A tax rise that singles out income from employment can only make this inequality worse, and new clause 5 seeks to expose this.

Not only does inequality manifest between people who may live in the same area, it also creates divides between different nations of a country and the regions within them. In areas where average wages are lower and fewer people get income from other assets, the impact of the national insurance rise and the levy will be more acutely felt. Recent analysis in the New Statesman suggested that within the regions of England, it is people in the north-west and the west midlands who will take the greatest hit to their disposable income as a result of the Bill.

Data from the Office for National Statistics’ wealth and assets survey shows that the south-east is home to well over 3 million adults living in families with net wealth per adult of more than £250,000. That is roughly six times the number in the north-east. A tax increase that ignores income from renting out properties and selling financial assets, and that seeks to fund a plan that ignores differences in house prices and care costs between different regions, is destined to make inequality worse.

[Dr Murrison]

We are getting more granularity in the proposals that Opposition Front Benchers have in their heads for funding the uplift, which I think we all agree is necessary for health and social care, but can I probe the hon. Gentleman to describe the nature of the landlords or property-based businesses he has in his crosshairs for the levy of the moneys that he has in mind? Does he mean, for example, the mom and pop organisation that has bought a small residential property because it has no public sector pension, for example, and is relying on that for income in old age, or does he have in mind a business like any other business that has large numbers of commercial properties? How much does he think he is going to raise from the alternative that he has suggested?

[James Murray]

I thank the right hon. Gentleman for his intervention, but I do feel that there is a broad consensus across this country that those with the broadest shoulders should make more of a contribution. It is quite clear from the reaction that people have had to the Government’s proposed increase in national insurance and new levy that this is falling on working people and jobs rather than taking other sources of income from wealth into account.

I have just spoken about the massive impact that this will have on inequality between different regions of the country. I therefore ask Conservative Members to guess how many times last Tuesday, when the Prime Minister announced his approach here in the House of Commons, he used the phrase “levelling up” in that 90 minute statement. It was zero. Last Wednesday, when the Financial Secretary had to take the rap here on this tax rise, how many times did he use the phrase “levelling up” in a six-hour debate? Zero. The truth is that we are a very long way from the levelling-up agenda that we hear, or at least used to hear, so much about.

Of course it is not just workers and the self-employed who will feel the direct impact of the Government’s tax rise in this Bill. This tax rise will hit businesses that want to create jobs too. That is why we have tabled new clause 4 to show the impact it will have on businesses, and on small and medium-sized businesses in particular. There will be no point in the Financial Secretary denying the impact of this measure on businesses creating jobs: it is set out starkly in the Government’s own tax information impact note that he approved last week and that we have referred to several times today. I set out earlier how this note admits that the Government’s approach will impact business decisions around wage bills and recruitment. It goes on to explain how this measure

“is expected to have a significant impact on over 1.6 million employers who will be required to introduce this change.”

No wonder the Government have managed to unite business groups, workers and trade unions against their plans. At just the time when we need to see job growth, and when furlough is ending, the Government impose an extra flat cost on getting people into work. The Federation of Small Businesses has shown that this move could lead to 50,000 more people being left out of work. Yet again, small and medium-sized businesses least able to afford this tax rise will be hit hardest while online multinationals continue to dodge their tax on this Government’s watch.

The Government’s justification for much of the Bill is that they claim the levy will fix the crisis in social care. As we made clear on Second Reading, however, there is no plan to fix social care, nor even a mention of or reference to one, in this Bill. Fundamentally, despite all the rhetoric from the Prime Minister and the Chancellor, there is no guarantee that social care will benefit from the Government’s tax rise in any way at all. In the first year, the Bill explicitly rules out any money raised going toward social care. Beyond that, when the levy comes into force, it is entirely possible that not a single penny of any money raised will ever go towards the social care sector. I know that Treasury Ministers will deny that this is the case, so we ask them and Conservative Members to back our straightforward new clause 6. I note the Financial Secretary’s comment that the new clause would simply require the Chancellor to report transparently and straightforwardly on the share of the levy spent on social care each year so that we can all see what proportion of the money raised is going to the social care sector.

Finally, I turn to our new clause 7. Nothing could sum up the intrinsic unfairness at the heart of this Bill more than the case that this new clause points towards. The unfairness of the Government’s approach is impossible to ignore when we realise that this tax rise, raising money the Government claim will go towards social care, will not see those with the broadest shoulders paying their fair share but instead hit low-paid social care workers themselves. Our new clause asks the Government to be transparent and honest about this by requiring the Chancellor to report on how much revenue the levy raises from those working in the social care sector. This Government’s choices to raise national insurance, to cut universal credit and to freeze personal allowances mean that a social care worker will pay £1,108 more in tax a year. The Chancellor once clapped for key workers; now he is taxing key workers. This will hit working people hard, and we will not let voters forget it.

[Mr Fysh]

My intention with amendment 7, which I have tabled with esteemed colleagues, was to try to get the Government to focus on a way of looking at the future costs of social care and how to finance them more creatively. I have to ask: if not now, when?

We know that the most powerful way to address costs in the future is to provide for them in the present and to have the power of compounding investment returns over a period of years to meet the liabilities that people have. I am passionate about encouraging the Government to look at ways to encourage people across the board, with progressive incentives in different ways, to make provision for themselves with support from the state.

People think that they pay a contribution into national insurance that rolls up over time and gives them an entitlement to a pot of money—I have heard constituent after constituent talk about that—when we in this place know that that is not in fact the case. In fact, my right hon. Friend the Minister confirmed that that is not the Treasury’s view and that national insurance is a tax collected in-year that must be spent in-year.

There is a big opportunity for reform and innovation that could be useful and get very much back to the ethos behind the Beveridge report and the origins that I spoke to in the Second Reading debate. There was a radical movement trying to help individuals and groups provide for each other. Lloyd George and the Liberal Government’s 1911 Act was about getting national aid into the system in a creative way. I think there is an opportunity for us to talk as one whole House about innovating for the modern world in that way. What was wrong with some of those older schemes and co-operatives, friendly societies and such things in the old days was that sometimes people ran off with the money. That was one reason why there was a need to put more of a national embrace around it and administer it that way. In the modern world, we can do it differently.

All I was trying to do with the amendment was give scope for the Government to think about applying some of the funds from an element of national insurance or something related to it—that is, the levy, which clause 2 sets out—to help incentivise such pooled saving schemes. That is not necessarily insurance or private insurance with a middleman; it could be national schemes or community schemes that are properly co-operative and very low-cost. There are many modern approaches to that in the digital world, such as digital autonomous organisations, where there are no middlemen at all and people do not have to rely on a contract.

That was the pure intent of my amendment, so I am a little disappointed that the Government do not seem to want to engage with it. I urge my right hon. Friend and those on the Treasury Bench to think about ways we might do that in the future, because I can see it as a useful evolution of the policy that might bring people from all parts of the House together in the way I have been describing.

--- Later in debate ---

[Jesse Norman]

I thank colleagues for their contributions to the debate. It has been very wide ranging—especially the last speech—occasionally touching on the subject of the Bill and the clauses and amendments in it.

Let me start with the hon. Member for Ealing North (James Murray) who speaks for the Opposition. He asked why the dividend tax has not been brought in. The answer to that question is that it does not fall under a national insurance contributions Bill. Dividends are subject to a separate dividend tax regime. That is a tax that is already in existence and it will be handled, as the Government have already made clear, in the course of the forthcoming Finance Bill.

The hon. Gentleman asked questions about levelling up and multinationals’ tax avoidance. I think he is aware that the Government’s approach to levelling up is extremely manifest, most recently in the work that we have done with the UK Infrastructure Bank, which is specifically dedicated to net zero and levelling up and which has just recruited a world-class new chief executive. On the case of multinationals, he has obviously forgotten that the Government have been in the vanguard of the G20 and the G7 in arranging and leading on a new settlement on Pillar One and Pillar Two multinationals’ tax avoidance.

The hon. Gentleman repeated his untrue claim from the earlier debate that these measures contain no new funding for social care. In fact, as the Chief Secretary to the Treasury said a few minutes before he first said that, the measures contain £5.4 billion to support social care, which is in the plan. In case he missed it, it is in paragraph 36 of the plan. It is no wonder that those on the Labour Front Bench do not think that we have a plan if they cannot be bothered to read the plan that we have actually published.

[James Murray]

To be absolutely clear, the question that I was putting to the Minister was: where in the Bill is there a guarantee that a single penny of this new levy will go to social care?

[Jesse Norman]

The Bill is designed to fund the plan and the plan has been published. The plan is perfectly explicit as to where the money is going with regard to social care and how much is going to social care. It is in paragraph 36. The hon. Gentleman only needs to look at the plan to see it.

My hon. Friend the Member for Yeovil (Mr Fysh) tabled a probing amendment and explained the background to his own amendment 7, and I thank him for that. I mean him no disrespect when I say that the Government have taken the amendment on board, and will take it on board, but I still ask him to withdraw his amendment.

The hon. Member for Aberdeen South (Stephen Flynn) talked airily about unfunded social care plans controlled, as it were, by England over Scotland. Nothing could be further from the truth. The truth is that Scotland has social care plans that are underfunded. Audit Scotland said that more money was needed. The Independent Review of Adult Social Care in Scotland said that more money will need to be spent over the longer term. Unfortunately, he also ignores what has been accurately described by the Prime Minister as the Union dividend from which all the devolved Administrations will benefit.

My hon. Friend the Member for Amber Valley (Nigel Mills) asked the important question of why a new tax. It is important to focus on this. The reason there is a new tax is that this is a fundamental change in how we have been thinking about social care. Andrew Dilnot himself has said that he does not think it inappropriate to have a new tax funded to support this.

My right hon. Friend the Member for Wokingham (John Redwood) talked about Treasury concern with hypothecation, which remains intact. There is already an existing level of hypothecation within the national insurance contributions system and this plays off that. The hon. Member for Nottingham East (Nadia Whittome) went into a long diatribe, in which she accused the Government of seeking to protect the richest people in society, to which the only simple answer is that that is absolute nonsense. I think she missed the debate on Second Reading, but if she read the distributional analysis, she would see that this package means that the 20% of highest income households will contribute 40 times the amount contributed by the least well off 20% of households. It is also worth pointing out that the highest earning 14% will pay roughly half of all revenues. Even the Wealth Tax Commission, which is independent of Government and dedicated to the idea of arguing for a wealth tax, acknowledged that the UK is on par with G7 countries as regards a wealth tax. Under a more inclusive definition—one that includes, for example, stamp duty land tax—the UK is near the top of the G7 countries in terms of a wealth tax.

My right hon. Friend the Member for Wokingham talked about hypothecation; I perfectly understand that. He also mentioned gross net revenues. These are net revenues—revenues that have been calculated net of the effects. The detail is set out in the technical annex to the published plan.

The hon. Member for Leeds East (Richard Burgon) revisited some of the themes set out by the hon. Member for Nottingham East, but I am afraid no more persuasively.

My hon. Friend the Member for Christchurch (Sir Christopher Chope) went on a glorious canter, or possibly a ramble, around various public spending concerns. I fully appreciate his concerns. Very little of what he said actually bears direct relation to the levy, but let me address the parts that do. He asked why there is no distinct social care levy. Of course, it is possible to claim, as I did, that there is a need for greater integration between healthcare and social care, without suggesting that the funding for those things needs to be handled in exactly the same way across both. This provision blends the funding in a way that is felicitous for both elements.

My hon. Friend argued vigorously for co-payment. I take his arguments as I am sure he means them and look forward to seeing his Bill. He also mentioned millionaires in hospitals. He is right that maths is eternal; our noble Friend Lord Bethell may have been referring to the fact that calculations are not eternal, but may be in time and premature.

--- Later in debate ---

[James Murray]

I thank the Clerks for their excellent and particularly rapid help with amendments to the Bill.

Today, the Government have been determined to push through their tax rise on working people and their jobs as quickly as they possibly can. The Bill contains nothing at all—not even a reference or mention—about a plan to fix social care, and it fails to guarantee that a single penny of the new levy will ever go towards the social care sector.

On Second Reading, the Opposition attempted to push for a guarantee that Parliament would vote on a social care plan before spending the money that the Bill raises. The Government rejected our attempt, and I am sure there are many Conservative Members who feel deeply uncomfortable about the position in which they find themselves.

While the Bill lacks a plan for social care or any commitment that a plan will ever be in place, or even that any of the money that the levy raises will ever go to social care, it does include a tax rise—a tax rise that hits working people and businesses creating jobs. We know what that will mean for people across the country: combined with the cut to universal credit and the freeze in personal allowances, hospitality workers, teaching assistants, supermarket workers and social care workers stand to lose more than £1,000 next year.

Members do not have to take my word for it. The Financial Secretary admitted the impact that this tax rise will have in his own tax information and impact note, which set out in no uncertain terms that people who are just about managing financially will see their disposable incomes fall. The Conservative party has united the Federation of Small Businesses, the British Chambers of Commerce and the CBI against its plans. They all agree that this represents a blow to jobs growth at a crucial point in the UK’s economic recovery. Last night, the Financial Times published its view that the “Tories must regain trust as the party of business”—which seems to be an understatement, to say the least.

The Government’s approach will hit businesses creating jobs, and it will disproportionately hit working families and young people. It will hit those on low and middle incomes. It will hit people in some parts of the country more than others. But when we tried to push Ministers in Committee to come clean about the unequal impact of their tax rise on different people and across the country, or to be transparent about how it would hit social care workers themselves, they refused. The Prime Minister, the Chancellor and the Conservative party simply have their fingers in their ears.

Finally, the Government have refused to accept throughout today’s debates, and indeed throughout the last week, that there is any alternative to their tax rise. The Prime Minister and the Chancellor are desperate to pretend that this is the only way to raise the money, and that simply is not true. A fairer approach to funding the NHS, social care and all our public services would see those with the broadest shoulders—including those with incomes from large financial assets and multiple rental properties, and other income from wealth—contributing more. The Government have refused to consider those options, and would prefer to hit workers instead.

The simple truth is that there is no plan to fix the crisis in social care. There is no plan to improve the pay and conditions of care workers, no guarantee that any of the money will go toward social care, no guarantee that people will not have to sell their homes for care, and no plan to clear the NHS waiting list backlog during the present Parliament. All that we have is a tax on working people and their jobs. It tells us everything we need to know about the instincts of the Tories when they are in power, and that is why we will be voting against this Bill.