Commons Sense

House of Commons · Ministers' Questions

Employer National Insurance Contributions: Business Impact

Tuesday 4 November 2025 · 3 questions

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

Read the full transcript on Parliament.uk

At a glance

Answered 0 Partly answered 3 Not answered 0

Key points

  • The government states that 43 percent of employers will pay no employer national insurance this year due to changes in the employment allowance.
  • The response to a question about the impact on retail cites improvements in NHS waiting times as a result of tax changes, rather than addressing retail sector concerns.
  • The number of people waiting more than 18 weeks for an NHS appointment in certain constituencies has decreased according to the government, attributed to tax changes made.

Topics (select to filter)

Questions & Answers

Q1 Wendy Morton Con Aldridge-Brownhills
Economy Business & Trade
Context

The previous government left a £22 billion deficit, prompting the Chancellor to implement tax changes in last year's Budget. Family businesses are concerned about the impact of increased employer national insurance contributions and restrictions on business property relief.

Question

I am not convinced that the answer went anywhere near my question. Family businesses are the lifeblood of communities and constituencies like mine. Last week, I met Family Business UK to discuss how the government's national insurance hike and restrictions to business property relief are forcing businesses to pause investment, think twice about taking on more staff and in some cases even close their doors. Ahead of the Budget, will the Chancellor meet me and representatives from family businesses to seek ways in which the Government will work with, not against these really key businesses?

Answer from The Chancellor of the Exchequer (Rachel Reeves)

I thank the right hon. Lady for that question, and 43% of employers—almost 1 million—will pay no employer national insurance this year. That is an increase because of the changes we made to the employment allowance. Over half of employers with NIC liabilities will see no change, or will gain overall, and businesses can employ younger people—those aged under 21 and apprentices under 25—without NICs. However, the Conservatives must decide whether they will stick with this change to national insurance. If they are not going to, they will have to admit that they will not be able to put the money into the national health service.

Partly answered

Not addressed: Meeting representatives from family businesses

How: Sticking With This Change To National Insurance

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Q2 Joe Robertson Con Isle of Wight East
NHS Economy Employment
Context

The British Retail Consortium claims the Chancellor's last Budget caused a £7 billion cost to retail, leading to shop closures and job losses. Joe Robertson is concerned about these impacts.

Question

According to the British Retail Consortium, the Chancellor’s last Budget caused a £7 billion cost to retail, leading to shop closures, declining high streets and job losses. If the Chancellor will not acknowledge the damage she has caused, how will she go about rectifying it? Can I recommend that she starts with the 100% business rate relief put forward by the shadow Chancellor?

Answer from The Chancellor of the Exchequer (Rachel Reeves)

I thank the hon. Gentleman for that question. In his own constituency in the Isle of Wight, the six-monthly waiting list figures show that 5% fewer people are waiting for 18 weeks or longer. That is only possible because of the money we put into the NHS because of the tax changes we made. On retail sales and the impact on shops, retail sales have increased for the last four months in a row, with the most recent numbers for August and September outpacing expectations.

Partly answered

Not addressed: Addressing damage to retail caused by Budget

How: Improvement In Nhs Waiting Times

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Q3 Gareth Bacon Con Orpington
NHS Economy Taxation
Context

Inflation has risen steadily under this government, reaching almost twice its recommended level. Gareth Bacon is concerned about the productivity decline in the NHS despite increased tax on businesses.

Question

It was always blindingly obvious that increasing employer national insurance would lead to an increase in business costs, which would lead to higher prices hitting working people directly and rises in inflation. Sure enough, inflation has risen steadily under this Government, and it is now at almost twice its recommended level. At the last Budget, we were told it was necessary to raise taxes on businesses by £25 billion to pay for the NHS, but just yesterday the Office for National Statistics announced that NHS productivity had fallen by 1.5% since Labour took office. Can the Chancellor explain what exactly my Orpington businesses are paying more tax for?

Answer from The Chancellor of the Exchequer (Rachel Reeves)

In the hon. Gentleman’s constituency, the number of people waiting more than 18 weeks for an appointment has also fallen. That is exactly what that money is being used for. He needs to be clear, and so do those on the Opposition Front Bench: if they want to reverse the increase to national insurance, they must also accept that there will be less money for our national health service.

Partly answered

Not addressed: Explaining impact of increased taxes on business costs

How: Improvement In Nhs Waiting Times

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