Question to the HM Treasury:

To ask His Majesty's Government what assessment they have made of the Bank of England Monthly Decision Maker Panel data for December 2024, which show that, of the businesses surveyed, 54 per cent expect to raise prices, 53 per cent expect lower employment, and 39 per cent expect to pay lower wages than they otherwise would have, following the increase in employer National Insurance contributions; and what action they plan to take as a result of that data.

Business surveys provide an indication of the range of ways businesses might respond to the increase in employer NICs, which varies business to business. Overall, once the impact of all budget measures are taken into consideration, the OBR expect the employment level to increase from 33.1 million in 2024 to 34.3 million in 2029. Further details are set out in the OBR’s Economic and Fiscal Outlook, which was published in October 2024.

A Tax Information and Impact Note (TIIN) was published alongside the introduction of Bill containing the changes to employer NICs. The TIIN sets out the impact of the policy on the exchequer; the economic impacts of the policy; and the impacts on individuals, businesses, civil society organisations and an overview of the equality impacts.