National Insurance Contributions (Rate Ceilings) Bill

Debate between Kit Malthouse and Mark Spencer

Tuesday 15th September 2015 Commons Chamber

[Kit Malthouse]

These things always involve a balance. A point that I have often made in another elected chamber—this is one of the things that dismays me a little—is that under the last Government we became used to having, effectively, two Budgets a year. There were two points during the year at which businesses, and indeed everyone else, had to hold their breath because there might be some change in the fiscal environment. Pleasingly, however, over the last four or five years, that change has been generally beneficial. The direction of travel of the United Kingdom has been towards a lower-tax environment for business, and we have seen the benefit of that in the jobs market and the growth of the economy over the last few years.

[Mark Spencer]

Does my hon. Friend agree that taking on staff constitutes a large responsibility for employers? They know that they are responsible not only for their employees’ health and safety, but for their future financial security, because the employees’ mortgages depend on their careers in the business. Anything that the Government can do to remove a barrier from the ability to employ someone has to be welcomed.

[Kit Malthouse]

That is exactly the point that I am making. Businesses are much more likely to employ people if they have some certainty about the overall cost of employment—not just wages, but on-costs such as expenses. Within that, national insurance is a very significant cost, and providing an element of certainty over the next four or five years is therefore extremely important.

Let me now return to a point that I was making earlier about signals. When I was Deputy Mayor for business and enterprise at City Hall, a position that I occupied for three and a half years, I was in charge of foreign direct investment. My job was to go around the world encouraging people to come and invest in London and the south-east. One of the things I learnt from that experience was that signals from City Hall about what we were willing to do, and how welcoming we were likely to be to particular companies, individuals or investors, was critical to whether they wanted to come here. In that context, an element of certainty and predictability, not just political and legal—we are seen to have that around the world—but fiscal, was absolutely vital