House of Commons · General Debate
04 February 2025 · 8 other contributors
Opened by James Murray Con Exchequer Secretary to the Treasury
Summarised by AI from the official record, so it can contain mistakes.
James Murray raised concerns about national insurance contributions 2025-02-04 in the House of Commons. A government minister responded. Other MPs also contributed.
Key points
MPs spoke in turn to share their views and ask questions. Here's what each person said.
Opened the debate
The draft Social Security (Contributions) Regulations set national insurance contribution rates, limits and thresholds for the 2025-26 tax year. They also provide a Treasury grant of up to 5% of estimated benefit expenditure into the National Insurance Fund and extend veterans' employer relief. Child Benefit and Guardian’s Allowance will increase by CPI (1.7%) in line with inflation.
Welcomes the extension of national insurance contributions relief for veterans but urges the Minister to ensure wider awareness among employers to incentivise employing veterans.
Asks about the planned figure for the Treasury grant, receiving an answer that the provision is precautionary with a forecast of no need for it in 2025-26.
Welcomes continuity in regulations but notes the exception of the secondary threshold which will be changed by another Bill to reduce from £176 weekly to £96 with a rise in the NICs rate.
The hon. Member for Treforest talked about the double impact on workers from both tax measures and proposed Employment Rights Bill, which is estimated to cost £5 billion more. He raised concerns that this could lead to job losses and make it harder for people to find employment.
The hon. Member for Torbay expressed his concern about the impact of national insurance increases on tourism and high-tech industries in his constituency, citing examples such as Paignton pier, Paignton zoo, Splashdown, and Bay Care social care business. He highlighted that these changes could lead to reduced working hours, offshoring of manufacturing jobs to places like Taiwan, and challenges for the voluntary sector.
The hon. Member for Caithness, Sutherland and Easter Ross echoed concerns about job losses in the hospitality industry, emphasising that this is particularly devastating given the low employment levels in his region.
The hon. Member for Torbay spoke about a Bill rather than the regulations being debated, expressing concerns that may not be directly related to the current topic.
The Chancellor emphasised her commitment to boosting growth by removing barriers such as onshore wind turbine bans and reforming pension investments. She also highlighted the importance of stable public finances for investment and growth, stating that difficult decisions were necessary to restore public finances while supporting public services.
Government Response
With the leave of the House, Madam Deputy Speaker, I responded to the comments of hon. Members, noting that while we had to take difficult decisions such as increasing employer national insurance contributions and lowering secondary thresholds due to the fiscal situation inherited from previous governments, the Office for Budget Responsibility (OBR) predicts an increase in employment levels from 33.1 million to 34.3 million between 2024 and 2029.
Shadow Response
NoneThe hon. Member for Grantham and Bourne set out the official Opposition’s response, but largely focused on impacts of a different piece of legislation (the Employment Rights Bill) rather than the statutory instruments under discussion. He supported our extension of veterans relief until April 2026.