MP's concerns over rising National Insurance contributions for self-employed
Conservative MPs have voiced concerns about rising National Insurance contributions for the self-employed as they pressed ministers to stay on the side of “white van man”.
Conservative MPs have voiced concerns about rising National Insurance contributions for the self-employed as they pressed ministers to stay on the side of “white van man”.
Former minister Andrew Murrison called for reassurance from the Government that electricians, plumbers and plasterers would not be disadvantaged by the changes.
Backbencher Nigel Mills added that it would be unwelcome news among workers “who are probably struggling and not getting all the rights they ought to”.
Chancellor Philip Hammond has hit almost 2.5 million self-employed people by an average £240 a year with a hike in National Insurance contributions (NICs) in his first Budget.
Speaking during a debate on Budget resolutions, Mr Murrison (South West Wiltshire) said he has some “concerns” around the National Insurance rise.
He said: “It's very important to ensure that we don't disadvantage self-employed people.
“This party on this side always has been, I hope always will be, the party that supports white van man and, may I say on this particular day (International Women's Day) also white van woman.”
He added: “I hope very much we can have some reassurance from the Treasury frontbench later, on that plumbers and electricians and plasterers and people of that sort are not going to be disadvantaged.”
Amber Valley MP Mr Mills also said he had “some concerns” about the proposals, adding that the proposed increase would not totally level the gap in contributions paid by those in employment.
“Clearly any tax rise that discourages any kind of activity is not an attractive one, especially when we are quite reliant on self employment,” he said.
“I think that will be unwelcome news to those people who are probably struggling and not getting all the rights they ought to.”
Fellow Tory Charlie Elphicke had earlier defended the changes.
Dover MP Mr Elphicke said: “I heard the remarks from the Leader of the Opposition and the SNP saying isn't it appalling, but actually there should be a level playing field, surely, for the self-employed and for the employed.
“That's something about which I feel quite strongly and I think the Chancellor was right to bring in measures.”
Mr Elphicke said it was a matter of pragmatism and fairness, adding: “It's a matter where the playing field has skewed so much that social justice, fairness and the right thing to do must come first.”
Jacob Rees-Mogg (North East Somerset) sounded a note of caution over the changes to National Insurance contributions, noting part of the reason for low unemployment since 2008 is due to the “great flexibility” in the labour market.
He added this is something self-employment contributes to.
Mr Rees-Mogg said: “Though I very much doubt increasing (self-employed) National Insurance contributions by 1% and subsequently by 2% is going to change this balance fundamentally, often things economically happen at the margins rather than being an easily identifiable inflection point when you are starting out.
“So I'd be very cautious about this change and would actually urge the Government to look at the whole question between National Insurance and income tax in the round because National Insurance is #130 billion of revenue.
“It's an enormously important source of funding for what the Government wishes to do but its relationship to income tax is one that creates confusion and distortions within the system, and this is just one of those distortions.
“I'm not sure making a minor change at the edges is the right way to go about changing the relationship of taxation between the self-employed and the ordinarily employed.”