National Insurance Contributions (Secondary Class 1 Contributions) Bill

Debate between Jeevun Sandher and Gareth Davies

Consideration of Lords amendments
Wednesday 19th March 2025 Commons Chamber

[Gareth Davies (Grantham and Bourne) (Con)]

I rise on behalf of the official Opposition in support of Lords amendments 1 to 4, 8, 10, 14 and 21.

Before I dive into the detail, I want to get a little nostalgic. One year and six days ago, I opened Second Reading of the National Insurance Contributions (Reduction in Rates) Act 2024, which cut national insurance for some 29 million working people across the country. What a difference a year makes. At the end of my speech that day, I posed a simple question to the shadow Minister, now the Exchequer Secretary, which was really bugging me at the time: how will Labour pay for all its many spending commitments? I asked specifically what taxes Labour would put up, and called for Labour to just be straight with the British people. Alas, no straight answer was forthcoming, but now we know the answer, don’t we? It is just a shame that Labour gave it to us only after the general election.

Labour promised not to raise national insurance, and that it was on the side of British business. It said that it would deliver economic growth; how is that going? The fact is that the Chancellor is delivering a £25 billion tax rise on jobs across the country. That will stifle growth, hold back British business, and harm public services. This Labour national insurance Bill will, unbelievably, take the tax burden to its highest level in history on the backs of working people.

We are debating a series of amendments tabled and voted through in the other place with the aim of mitigating at least some of the damage to three vital parts of our economy and our communities: healthcare providers, charities and small businesses. Lords amendments 1, 3 and 4 seek to exempt from the measures care providers, NHS GP practices, NHS-commissioned dentists and pharmacists, providers of transport for children with special educational needs and disabilities and charitable providers of health and social care, such as hospices, as we have heard. That is because we have been warned that as a direct result of the national insurance tax hikes, we could see fewer GP appointments, reduced access to NHS dentistry, community pharmacies closing, adults and local authorities paying more for social care, and young working families being hit with even higher childcare costs. We have to avoid that.

[Dr Jeevun Sandher (Loughborough) (Lab)]

Would the hon. Member reverse this national insurance tax change? What spending would he cut to do so?

[Gareth Davies]

If the hon. Gentleman looks back at the record of proceedings on earlier stages of the Bill, he will see that we voted against it. If he looks at our record in government, he will see that we cut national insurance for 29 million people across the country. As I have said so many times in this place, why are we not debating the Government’s creation of an £8 billion quango in Great British Energy? Why are they spending £7 billion on a rebrand of the UK Infrastructure Bank? Why are they spending £9 billion on giving up our sovereignty to Mauritius? Let us start with those discussions; we can then have a real debate.

Lords amendment 2 recognises the role that the voluntary sector plays in the provision of essential services by seeking to exempt charities with an annual revenue of less than £1 million from the national insurance rate rise. Charities with an income of less than £1 million make up some 95% of registered charities and undertake vital work in all our communities, yet this Chancellor will force charity staff and volunteers across the sector to raise £1.4 billion more to cover this tax rise next year alone. Supporting this Lords amendment would prevent so many services provided by the third sector from being reduced, or even removed altogether.

Lords amendments 8, 10 and 14 seek to exempt the smallest businesses—those with fewer than 25 full-time employees—from the proposed cut to the threshold at which an employer is required to pay secondary class 1 national insurance.