Finance Bill

Debate between Joe Robertson and Jim Shannon

Report stage
Monday 3rd March 2025 Commons Chamber

[Jim Shannon]

The hon. Gentleman is absolutely right. That is what my small and medium-sized enterprises tell me—and, I believe, everyone else on the Opposition Benches—about that.

Ultimately, whenever the national insurance contributions are passed on to businesses, they will pass it on again to the customers—the wee man and the wee woman. They are the people that the Labour party—the party of conscience—says that it represents, but it will penalise them.

[Joe Robertson]

Does the hon. Member agree that the national insurance contribution rise for small and medium-sized businesses is not only passed on to the consumer but is damaging for the economy as a whole, because it stifles growth? Growth, not increasing tax rates, is the way to increase the tax take for the Treasury.

[Jim Shannon]

The hon. Gentleman is right—he makes that point well. One business in my constituency employs 1,200 people. It told me just before the new year that those measures would cost it £1.1 million per year. I asked, “What are you going to do to address that extra cost?” It said, “We cannot absorb very much of it, so we will pass it on.” That is exactly what will happen. If we want to promote growth, we have to consider all the aspects and problems.

Employer National Insurance Contributions: Charities

Debate between Joe Robertson and Jim Shannon

Tuesday 7th January 2025 Westminster Hall

[Joe Robertson]

I of course agree with the hon. Member that the Government must rethink the changes. I will go on to use examples from my own constituency, and I thank her for doing so with hers.

[Jim Shannon (Strangford) (DUP)]

Will the hon. Member give way?

[Joe Robertson]

I will make a little progress and then I will be happy to give way.

The National Council for Voluntary Organisations estimates that the overall cost of the money taken from charities and transferred into the Treasury will be £1.4 billion. That is money being taken from charitable sources and transferred into the Treasury. Sarah Elliott, the chief executive of the National Council for Voluntary Organisations, said:

“This is the biggest shock to the sector since pandemic. Charities already juggling rising demand, escalating costs, and the falling funding cannot absorb an additional £1.4 billion in costs without drastic service cuts...This additional cost, for which there is no headroom in budgets to cover, will be devastating.”

[Jim Shannon]

I commend the hon. Member for securing this debate. In Northern Ireland, the effect on charities will range from £5,000 per year to £200,000 per year. The costs are extreme and incredibly worrying. Does the hon. Member agree that charities are the backbone of many local communities across the UK, as he said earlier in his speech, and that as such they deserve even more support? Does he feel, as I feel on behalf of charities in my constituency, that the change could ultimately be the straw that breaks the camel’s back, and that charities could well disappear?

[Joe Robertson]

I agree with both those points. Charities tell us that the change will be the straw that breaks the camel’s back for many. I know that because, immediately before entering Parliament, I worked for a nursing charity supporting dementia carers.

The Government know the pressure created by the national insurance contribution rise. They exempted the NHS because they knew the impact it would have on healthcare, but they ignored or failed to understand the contribution that charities make to health and social care.