§ Dr. Glynasked the Secretary of State for Social Services what proportion of the national insurance contribution goes towards pensions and national health insurance; and what is the balance in each case which has to be made from general taxation.
§ Mr. WhitneyThe national insurance scheme is financed on a pay-as-you-go basis with the aim of achieving a broad balance between income and expenditure. Contributions are not allocated to specific benefits, but an approximate notional apportionment can be made. The proportion would be the same for all benefits paid from the NI fund.
For 1984–85 the figures are expected to be:
NI fund (per cent.) General taxation (per cent.) Retirement Pension 90 10 National Health Service 11 *86 * The remaining 3 per cent. is met by charges.
§ Mr. Gregoryasked the Secretary of State for Social Services what would be the total cost of eliminating class 4 national insurance contributions.
§ Mr. WhitneyThe estimated income to the national insurance fund from class 4 contributions in respect of 1984–85 is £280 million. Contributions are set so as to keep income in line with expenditure from the fund, so that if class 4 contributions were eliminated it might be necessary to make up the loss of increases elsewhere.