Class 4 National Insurance Contributions

Lord Walney Excerpts

Wednesday 15th March 2017 Commons Chamber

[Mr Hammond]

Yes. As we have now cast more widely our review of the differences in how employees and the self-employed are treated, it is right that we should look at that particular aspect as well, and we will do so.

[John Woodcock (Barrow and Furness) (Lab/Co-op)]

Can we just be clear: is the Chancellor saying that he was not aware that he was breaking his own manifesto promise until the BBC pointed it out, or that he was aware of it but was just hoping no one noticed?

[Mr Hammond]

Neither. We understand the commitment that we made to have been discharged by the passage through the House of the National Insurance Contributions (Rate Ceilings) Act 2015, which set out very clearly the scope that the then Chancellor decided to apply to the national insurance contributions lock. That is how the Treasury has worked since 2015, with the locks and ring-fences that were put in place. They are part of the everyday workings of the Treasury, and that was what we worked to in this case. However, I have accepted today that there is a broader interpretation—based on the manifesto itself, not the legislation that implemented it—and that is why I have come to the House and made this statement.