Commons Sense

House of Commons · Ministers' Questions

National Insurance Contributions

Tuesday 3 December 2024 · 9 questions

Summarised by AI from the official record, so it can contain mistakes.

Read the full transcript on Parliament.uk

At a glance

Answered 1 Partly answered 7 Not answered 0

Key points

  • Government has set aside 4.7 billion for 2025-26 to support public sector organisations with the additional cost of employer national insurance contributions.
  • Funding includes support through the Barnett formula for the public sector in Scotland.
  • The Government have taken tough decisions to increase national insurance contributions to fund public services and fix finances.

Topics (select to filter)

Questions & Answers

Q1 Rebecca Smith Con South West Devon
Economy Taxation
Context

An assessment is requested regarding the potential impact of an increase in employer national insurance contributions.

Question

What assessment has been made of the potential impact of the proposed increase in employer national insurance contributions on public sector organisations?

Answer from James Murray

The Government have set aside funding to support the public sector with the additional cost of employer national insurance contributions. The amounts are £4.7 billion in 2025-26, £4.7 billion in 2026-27, £4.8 billion in 2027-28, £4.9 billion in 2028-29 and £5.1 billion in 2029-30.

Answered
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Q2 Chris Law SNP Dundee Central
Taxation Scotland
Context

Labour's increase in national insurance will cost Dundee city council a minimum of £7.3 million and an additional £500 million across Scotland.

Question

Will the Minister confirm that the full cost of the national insurance contributions increase to the delivery of public services in Scotland will be reimbursed?

Answer from James Murray

The funding includes support through the Barnett formula. If there is a higher cost in Scotland, it may relate to decisions about the size of the public sector.

Partly answered

Not addressed: Confirmation of full reimbursement was not given.

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Q3 Rebecca Smith Con South West Devon
Taxation Housing
Context

A major housing association in the constituency will have to shoulder three quarters of a million pounds in increased national insurance contributions.

Question

How will the Minister reassure my constituents patiently waiting for much-needed social housing when they realise that they will have to wait longer because of the Chancellor's decisions?

Answer from James Murray

The decision was necessary, but we are committed to building 1.5 million homes over this Parliament, focusing on social and affordable housing.

Partly answered

Not addressed: Reassurance for delays in social housing was not provided.

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Q4 Bill Esterson Lab Sefton Central
NHS Taxation
Context

The shadow Chancellor toured TV studios stating the Conservative party did nothing wrong in government.

Question

Will my hon. Friend confirm that the reason for the changes to national insurance is precisely to plug the £22 billion gap caused by the Conservatives?

Answer from James Murray

The problem with Conservative Members is that they are happy to say they want more funding for the NHS but not prepared to pay for it. We have taken tough decisions to ensure public services and fix finances.

Not addressed: Confirmation of changes necessity was evaded by criticizing opposition.

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Q5 Neil Duncan-Jordan Lab Poole
NHS
Context

Hospices such as Julia's House are concerned by the planned increase in national insurance contributions.

Question

What reassurance can the Minister give to hospices such as Julia's House, which serves my constituents?

Answer from James Murray

Many hospices are independent charities and can access employment allowance of £10,500 per year, business rates relief, and gift aid. Hospices with statutory obligations should discuss contracts with their integrated care boards.

Partly answered

Not addressed: Specific reassurance for hospices was not provided.

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Q6 Gareth Davies Con Grantham and Bourne
Taxation
Context

The House will vote on the Government's £25 billion national insurance tax hike.

Question

Will the Minister confirm exactly which public sector organisations will be compensated?

Answer from James Murray

Public sector organisations are defined by the Office for National Statistics. Departments and other public sector organisations will be reimbursed.

Partly answered

Not addressed: Exact names of compensated organisations were not provided.

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Q7 Gareth Davies Con Grantham and Bourne
Employment
Context

The Office for Budget Responsibility, Institute for Fiscal Studies, and Resolution Foundation all agree that the tax hike will affect working people.

Question

Why is it that Labour always leaves office with unemployment higher than when it entered?

Answer from James Murray

The employment level is predicted to rise from 33.1 million to 34.3 million by 2029 according to the OBR, indicating an increase in employment over this Parliament.

Partly answered

Not addressed: Specific reasons for higher unemployment under Labour were not provided.

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Q8 Daisy Cooper Lib Dem St Albans
Taxation Employment
Context

Citizens Advice in St Albans reports that changes to national insurance contributions will negatively affect their part-time staff and increase costs despite the rebate not covering all expenses.

Question

Citizens Advice in my constituency says that the changes to national insurance contributions will hit hard because they employ mostly part-time staff, going from paying nothing to the full amount. The increased rebate does not cover this impact. Will the Chancellor look again at the effect on part-time workers?

Answer from James Murray

We recognise that we have taken a tough decision to increase the rate and broaden the base through changes to the secondary threshold. Public services need support, but these decisions are necessary for funding public services.

Partly answered

Not addressed: Reviewing the impact of national insurance contribution changes on part-time workers specifically

How: Welcome The Work Done By The Organisation Mentioned, Public Services Need To Be Stronger

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Q9 Daisy Cooper Lib Dem St Albans
NHS Taxation Housing
Context

Hightown Housing Association estimates that the national insurance contribution changes will cost £860,000 per year, affecting their ability to pay interest on a loan for social homes.

Question

The extra costs of national insurance contributions will be £860,000 annually for Hightown Housing Association. This money would have covered the interest on a loan for around 60 social homes. Will the Chancellor conduct an impact assessment to see how these changes affect the number of social homes?

Answer from James Murray

We have taken tough decisions for funding ambitious plans in NHS, education, and housing. The impact of these changes is detailed in the tax information and impact note published alongside legislation.

Partly answered

Not addressed: Conducting a specific impact assessment on social homes due to national insurance contribution changes

How: Not All Are Prepared To Pay For Public Services, Impact Assessments Are Published In Tax Information And Impact Notes

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