National Insurance Contributions (Secondary Class 1 Contributions) Bill

Sarah Dyke Excerpts

2nd reading
Tuesday 3rd December 2024 Commons Chamber

[Sarah Dyke (Glastonbury and Somerton) (LD)]

I rise to share my concerns about the unintended consequences of this tax hike on small businesses, GPs, social care providers and farm businesses. The arguments about the damage that the previous Government left are well rehearsed, and significant effort is needed to rebuild public services and repair public finances, but this measure will do just the opposite. As GPs and the vast majority of care providers are private, they will not benefit from the compensation that the Chancellor will give to the NHS and other public sector employers to cover the cost of this tax increase.

Langport surgery in my constituency told me that it faces an additional cost of £45,000 a year, due to the national insurance rise. It said:

“at a time when general practice is facing workforce shortages, higher costs could make it even harder to hire and retain staff, directly impacting patient access”

to good-quality care. The impact on social care providers could also be severe; six in 10 of the UK’s care home beds are provided by companies that could go bankrupt if they experience even a mild economic shock. I have been discussing these difficulties with Wincanton Cares, a support and advice group for people needing care in south-east Somerset. It is concerned that care home closures may well happen, as the funding model is so precarious.

I am also worried about the impact that the measure could have on small businesses, which are the foundation of the Government’s growth agenda. In advance of Small Business Saturday, I have spoken to many businesses in Glastonbury and Somerton, including Topline Glass based in Ilton. It described the Budget as a triple whammy of increased NICs, wage rises and business rate increases. The OBR has estimated that the increases to employer NICs will reduce potential output by 0.1%, while the costs to businesses will lead to lower wages and profits. The Government should have instead listened to Liberal Democrat calls to raise money through fairer tax changes, such as reversing the Conservative tax cuts handed to big banks, increasing the digital services tax to 6%, doubling the rate of remote gaming duty paid by online gambling companies, and fair reform of capital gains tax, so that the 0.1% of ultra-wealthy individuals pay their fair share.

Many farming and agricultural businesses will also be hit by this tax rise. In addition, farming businesses will now be subject to increased NICs, further stretching their budgets. The CEO of the Nature Friendly Farming Network has stated that the increase in national insurance will be a big concern for businesses that rely on a large workforce to pick, process and package food. As farming yields very slim returns, those added costs will likely be passed on to consumers, pushing up food prices and disproportionately affecting those least able to afford high-quality, UK-produced food.

The likely increase in the cost of UK food would inevitably lead to a reliance on cheaper imports, particularly from countries with lower production and welfare standards, undermining UK farmers and potentially increasing climate-related harm elsewhere. Driving down food security and pushing up prices is damaging to national security. The Government have an opportunity to look again at these measures that damage British farming. If they will not, they will not be forgiven.

Economy, Welfare and Public Services

Sarah Dyke Excerpts

Monday 22nd July 2024 Commons Chamber

[Sarah Dyke (Glastonbury and Somerton) (LD)]

It is an honour to return to the House and to represent residents of this new constituency.

Constituents tell me that the issues that matter to them most are health and social care, rural affairs, housing and local services. About 2.5 million people are out of work with long-term sickness, so the challenge for this Government is to fix the health and care crisis, because a healthy economy requires a healthy NHS. This new Parliament presents an opportunity to work collaboratively to fix many of the issues plaguing my constituents.

There is a dental provision cavity in Somerset. There are no dentists in Glastonbury and Somerton taking on new NHS patients. One practice in Street has not had an NHS dentist in post for 18 months, although the job has been advertised continuously. I am sure that all Members have heard many heartbreaking stories from people suffering in dental agony. I recently spoke to Ian from Langport, who told me that he was unable to access the crucial NHS healthcare that he needs. His only option is private dental treatment, which will cost him more than £3,000. For Ian and for so many others, this is simply unaffordable. It is no wonder that residents are left open-mouthed when they hear that £8 million was underspent on NHS dentistry in Somerset last year alone. NHS dental contacts need reform urgently, and the recruitment crisis must be unblocked.

People are also waiting longer to see a GP. Last year the number of four-week waits rose by 49% in Somerset. The number of GPs must increase in order to guarantee patients the right to see a GP within a week, or within 24 hours if the situation is urgent. By improving local frontline services, we will reduce pressure on our hospitals. I was delighted to visit a rural health hub during the last Parliament, and I call on the Government to maintain support for such hubs because they have proved that they offer flexible and accessible healthcare provision for our rural and farming communities.

This week is Farm Safety Week, and it marks the 10th anniversary of the Farm Safety Foundation, an organisation that I am proud to work alongside to highlight the key challenges faced by farmers and farm workers every day. People working in agriculture are 21 times as likely to be injured at work compared with the national average, while 95% of farmers under 40 agreed that poor mental health was the biggest problem facing the industry today. The agricultural sector is crucial to the rural economy, and farming is vital to UK food security, but inflationary pressures continue to damage farm businesses, and the mismanaged transition from the basic payment scheme to environmental land management schemes is forcing many farmers out of business.

Food security also requires fair access to international markets, but the last Government’s botched trade deals damaged that. Those deals undermine our nation’s health and our environmental and animal welfare standards, and they must urgently be renegotiated. To protect the rural economy, there needs to be fairness in the food chain, and the groceries code adjudicator needs more teeth. That would support our farmers and protect consumers from unfair price rises.

Glastonbury and Somerton is home to some of the lowest-lying land in the country, so a serious commitment to food security requires a robust approach to flood management. Of course, agricultural land will always play a vital role in preventing flood damage to urban areas, but this cannot be at the expense of agricultural businesses, which need to be properly compensated for the sacrifices they make. Ensuring that water is managed correctly also means managing the nutrient load of rivers and lakes. We require legislation to ensure that nutrients enrich and improve our soils, rather than being leeched away into our rivers, which adds to the pollution crisis.

Making such reforms would unlock the 18,000 homes in Somerset that already have planning permission and are currently waiting to be built. The new Government have pledged to make that possible, and I welcome the new Secretary of State for Housing’s recent commitments on this issue. I eagerly wait to hear the Government’s plans, because there is a serious shortage of homes and a solution is desperately needed. However, I am clear that homes must be built in the right places and to the best possible environmental standards, and they must be delivered with the infrastructure that communities so desperately need. After years of an out-of-touch Conservative Government taking us all for granted, I am looking forward to having the opportunity to work together to deliver the ambitious changes we desperately need.