National Insurance Contributions (Secondary Class 1 Contributions) Bill

Julian Smith Excerpts

Consideration of Lords amendments
Wednesday 19th March 2025 Commons Chamber

[James Murray]

I do not know the situation of those hospices, so I will not give them direct advice on managing their operations. More generally, I have set out the Government’s approach to providing direct support for Departments and other public sector employers. It depends how hospice care is provided. In many cases, integrated care boards are responsible for commissioning palliative and end of life care services to meet the needs of local populations. Where hospices are commissioned by the NHS, contractual arrangements should be discussed with the integrated care board at local level.

[Sir Julian Smith (Skipton and Ripon) (Con)]

The Minister has a capital budget and revenue budgets. We are talking about a small amount of money—£4 million or £5 million—so will he consider switching £4 million or £5 million from the capital budget to the revenue budget? Opening up that opportunity would have merit, and would help these very vulnerable organisations.

[James Murray]

I have set out the Government’s approach to supporting Departments and other public sector employees when it comes to the changes to employer national insurance contributions. As I said to the shadow Chief Secretary to the Treasury, the hon. Member for North Bedfordshire, we are taking the same approach that his Government took to the health and social care levy. We are talking about the wider pressures faced by organisations, be they GPs or hospices, and what we can do to support them and their processes. We are considering the pressures on them in the round. I have made a considerable number of points about Lords amendments 1, 4, 5, 9 and 13. In the light of those points, I urge the House to disagree with those amendments.

I turn to the Lords amendments relating to charities, local government and special educational needs transport. Lords amendments 2, 7, 12 and 16 seek to exempt charities from the changes to employer national insurance contribution rates and thresholds. The Government recognise the crucial role that charities play in our society. We recognise the need to protect the smallest charities; that is why we have more than doubled the employment allowance to £10,500 pounds, meaning that more than half of businesses, including charities with national insurance liabilities, either gain or will see no change next year.

As I have noted, it is important to recognise that all charities can benefit from the employment allowance. The Government provide wider support for charities via the tax regime; tax reliefs for charities and their donors were worth just over £6 billion in the tax year to April 2024. Again, the amendments would put much of the funding that the Bill seeks to raise for public services at risk, so supporting these amendments is support for higher borrowing, lower spending or other tax rises.

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[Gareth Davies]

Absolutely. To be fair, I do not think the profound impact of this tax is appreciated by Labour Front Benchers. The hon. Lady has pointed out yet another area in which it will have an impact—tax on education. I could talk about the impact on universities as well.

[Sir Julian Smith]

Does my hon. Friend think that the Government have assessed the loss of tax revenue that will result from this measure? In North Yorkshire, almost all of the jobs that would have been created in small businesses over the coming year are now being repressed, leading to a loss of income for the Exchequer.