§ Mr. Simon Hughes
To ask the Secretary of State for Social Security if he will estimate(a) the cost of changing the national insurance threshold into a tax allowance in 1990–91 and (b) the savings of abolishing the national insurance ceiling in 1990–91.
§ Mrs. Gillian Shephard
Using the rates expected to apply in the 1990–91 year it is estimated that removing employees' liability for national insurance contributions on the first £46 of weekly earnings (that is earnings up to the lower earnings limit) would cost about £0.9 billion in a full year. If the upper earnings limit for employees' contributions were to be abolished, the additional income would be about £2.3 billion.