Health and Social Care Levy

Richard Thomson Excerpts

1st reading
Wednesday 8th September 2021 Commons Chamber

[Richard Thomson (Gordon) (SNP)]

It is a standard trope from Conservative Members that public services in general, or the performance of the Scottish Government in particular, in some way fall short of what happens at Westminster. We heard earlier from the hon. Member for Berwickshire, Roxburgh and Selkirk (John Lamont), who seemed to spend more time complaining about the Scottish National party than he did talking about the NHS and social care.

Despite some of the Damascene conversions that have clearly taken place among Conservative Members overnight, a number of truths and realities in this debate should make for deeply uncomfortable feelings among Conservative Members. By levying this tax, they are not only breaking a manifesto pledge not to increase NI and increasing the tax burden disproportionately on the youngest and least well-off, but doing so in order to play catch-up with the health and social care landscape in Scotland.

I listened carefully to yesterday’s statement and intently to Conservative Members talking earnestly about the need for health and social care integration. I even listened carefully to that call when it came from Members who had, in ministerial office, been in a position to do something to drive that integration agenda forwards. What was startling for me was the gradual revelation throughout the course of the statement that there was no plan. There was no planned assessment of impact or plan for how the moneys raised would make their way through the NHS and ultimately to social care. Leaving aside the unfairness of the means by which these moneys are to be raised and the Prime Minister’s utterly bogus rhetoric about “Union dividends”, we are being asked to applaud the scale of the inputs without any thought having been given to the nature of the outputs. Clearly, in their desperation to do something about this, the Government have decided that a tax is the best form of defence.

It is also clear that in England at least this debate is not even in the foothills of where it needs to be about its health and social care integration. In Scotland, we embarked on that journey several years ago. There is some irony in the fact that on the day the UK Government finally announced their plan to lace up their running shoes on this, the Scottish Government in Edinburgh were announcing in their “Programme for Government” plans to go beyond health and social care integration and forge ahead with a national care service.

What this measure reveals most of all is the mismatch between policy and resources, and the shortcomings of the fiscal settlement for devolution. We saw that through the pandemic. We still do not know whether this is to be Barnettised or hypothecated. We do not know how much is to come to health and social care, and by what means. The answers to those questions matter, because if the devolved settlement is to be respected, the spending decisions should be taken by the Government who are directly elected and directly accountable to Scottish voters. The suspicion has to be, given the lack of detail on that, that this is yet another power grab, with the UK borrowing and claiming that borrowing as the so-called “Union dividend”.

In the time I have left, let me say that the most iniquitous aspect of all is the impact that this move has on the lowest earners in society, the youngest in society and those who have least in the way of assets of their own. They are being asked to forgo their earnings, for an objective with which few can quibble, in order to protect the assets of those who already have the most. This Government have removed the freedom of movement for young people across Europe, are seeking to disenfranchise them at the ballot box and now expect them to pay for a social settlement that few have the means to do and few can expect to benefit from. This is no country for young people at the moment.

--- Later in debate ---

[Steve Barclay]

One of the features of the Dilnot proposals—Dilnot has been very frank about this—is that his costs ramp up over time. That is why the initial funding is £5.4 billion, but obviously, the social care element will increase. I will come to the case put forward by SNP Members, who seem bizarrely not to want the Union dividend that is offered and to not be seeking that additional funding. Let me finish on the Opposition amendment—

[Richard Thomson]

Will the right hon. Gentleman give way?

[Steve Barclay]

I will come to the points on devolution and happily give way at that stage, but let me just deal with the Opposition amendment, which requests a distributional impact assessment. As we have covered, that has been set out today. The Government have already published a document on the impact of our health and social care plan on households, looking at the impact of the new spending and the levy, with a full distributional analysis being published at the Budget and spending review.

As for the impact on businesses, businesses will play their part in funding this plan. However, existing national insurance contribution reliefs and allowances will also apply to the levy. This means that 40% of all businesses will not be affected due to the employment allowance, and it allows eligible employees to reduce their national insurance liability by up to £4,000. Again, that point was brought out by my right hon. Friend the Member for South West Wiltshire (Dr Murrison), who highlighted the impact on business and the fact that businesses, with 1% of the highest turnover, will cover 70% of the cost.