National Insurance (Hansard, 10 July 2003)

§ 4. Mr. David Amess (Southend. West)
What plans he has to make further changes to the rates of national insurance contributions; and if he will make a statement.[124645]

§ 11. Bob Spink (Castle Point)
What plans he has to make further changes to national insurance contribution rates; and if he will make a statement.[124652]

§ The Paymaster General (Dawn Primarolo)
Any changes to national insurance rates are announced at the time of the Budget and pre-Budget report.

§ Mr. Amess
Following the loss of 200 jobs in the banking sector in Southend this week, will the Minister tell the House what plans she has to ensure that national insurance payers get value for money? Will she now admit that if the recent hikes are included, net taxes and social security contributions in the year 2003–04 will amount to £402.9 billion, but that that will not bring the improvements to public services that we would hope for? Will she admit that this rotten Government are taxing, spending and failing?

§ Dawn Primarolo
As the hon. Gentleman well knows, unemployment in his constituency has reduced dramatically since the Government were elected in 1997. He will also be fully aware that the national insurance rise is specifically to pay for the increased spending on the national heath service. He must answer the question of whether he is in favour of spending more on the heath service. If he is not, what will he say to his constituents about the services that he wants to cut?

§ Bob Spink
The whole country knows that the increases to national insurance so far and those that are further threatened by the Labour Government are destroying jobs and driving down the competitiveness of our economy because that must be the long-term natural result of such increases in taxation. Will the Paymaster General admit that the Labour Government are heading for a high-tax, low-efficiency economy—the old socialist piral?

§ Dawn Primarolo
Opposition Members will do anything to try to avoid the facts. There are 1.3 million more jobs in the economy. Britain's unemployment is at its lowest level since the 1970s. Opposition Members do not want to answer the question of whether they are in favour of increasing spending for the national health service. If they are not, why not, and how will they explain to their constituents the cuts, and the public services that they will not get?

§ Dr. Nick Palmer (Broxtowe)
Does my right hon. Friend agree that one of the difficulties is the measurement of progress in the health service? Those of us who have an interest in economic aspects are used to measuring such things as waiting list falls. However, some of the most important effects of our changes to national insurance and funding for the health service are non-measurable, such as the availability of statins for heart patients, which means that many thousands of 1358 people are walking around who would otherwise be dead. Does she agree that such non-measurable benefits are as important as those that we can weigh and count?

§ Dawn Primarolo
If my hon. Friend studies all the statistics, he will find out that in-patient and accident and emergency services, elective admissions and stations services offered by the national health service have increased. He is quite right that we need to increase spending on the national health service so that it provides the world-class service that our constituents want. National insurance is the fairest and best way to achieve that, and the spending results in improvements for his constituents and all our constituents.

§ Mr. Bill O'Brien (Normanton)
Does my right hon. Friend accept that the people in Yorkshire in particular, and throughout the country in general, think that a taxpayer-funded NHS is the best way forward for health provision, so that health care is provided on the basis of need, not on the ability to pay? Is the hospital building programme on target? Will the new hospital planned for my constituency go ahead on schedule?

§ Dawn Primarolo
My hon. Friend is a well known campaigner for the NHS, especially on the principle of availability to all on the basis of need. He is right to focus on the development of new hospitals. The Government have committed themselves to 110 new developments. Only 11 were undertaken under the previous Government. Those developments, including the hospital in my hon. Friend's constituency, are proceeding on time. I am happy to deal with more detailed questions that he may want to raise with me outside the Chamber if he wants to follow that point through.

§ Mr. Michael Howard (Folkestone and Hythe)
Is the Paymaster General really unaware of the difficulties that the Chancellor's tax on jobs and pay are causing for taxpayers, public services and businesses alike? Did she not see the announcement last week by HSBC of 1,400 job losses, with higher national insurance contributions and pension costs given as the cause? Does she think that HSBC does not know what it is talking about, or does she accept that the Chancellor's policies have directly led to the loss of those jobs? Will she rule out any further rise in employer national insurance contributions?

§ Dawn Primarolo
It is breathtaking to hear that from the right hon. and learned Gentleman, who was in a Government who increased national insurance, increased VAT and introduced 22 tax rises. He will not answer the question: does he support more spending in the national health service—yes or no?

§ Mr. Howard
The Paymaster General does not understand. She should answer questions—not ask them—on behalf of the Government.
So the Paymaster General refuses to rule out yet another rise in national insurance contributions for business. Is she not also aware of the pain that the Chancellor's rises in employee national insurance 1359 contributions are causing? Is that not a tax on income by another name? Does she realise that this year alone a typical couple on average full-time earnings are £568 a year worse off as a result of rising council tax, frozen allowances and the rise in national insurance contributions? If the right hon. Lady refuses to rule out another increase in employer national insurance contributions, will she now rule out a further rise in employee national insurance contributions? Will she rule out yet another breach in the upper earnings limit? If she cannot provide the reassurances people want—we know that the Chairman of the Treasury Committee recently cast doubt on her ministerial knowledge—perhaps she can take a minute to ask the Chancellor, who is sitting next to her, whether he can provide the answers that we all want?

§ Dawn Primarolo
That is very illuminating. The right hon. and learned Gentleman will do anything but answer the question normally, but he rose to the Dispatch Box on that specific point to say that he is not committed to spending that money in the NHS, which is what—

§ Mr. Speaker
Order. The shadow Chancellor has the luxury of not having to answer questions. He is entitled to ask them.

§ Mr. Howard
After those exchanges, we can all understand why the Chancellor does not like answering questions on tax at the Dispatch Box. This is a Government who said that they had no plans to increase tax at all, but who then introduced 60 new tax rises. This is a Government who said that people should not suppose that there would be rises in national insurance, but who increased national insurance in their very next Budget. Are there not growing fears of a black hole in the Chancellor's finances? After his record to date, is it not all too clear how that hole will be filled?
I ask for a third time: are the Government refusing to rule out yet further rises in employer national insurance contributions, employee national insurance contributions and the upper earnings limit? Is it not clear that the Leader of the House was right and that further tax rises are exactly what they have in store? After the promises they have made and the promises they have broken, is it any wonder that no one believes a word they say?

§ Dawn Primarolo
The right hon. and learned Gentleman cannot escape his own record. The British public are committed to and support increases in national insurance to pay for increases in spending in the national health service. It is fair and it is proper. He has confirmed today that he does not agree with that and that his party is not committed to that increased expenditure.