§ Mr. FlynnTo ask the Chancellor of the Exchequer what estimate he has made of the losses to the National Insurance Fund from the reductions of employers' contributions resulting from the introduction of the landfill tax, the climate change levy and the aggregates levy(a) separately and (b) in total, for each year from their introduction to 2010–11; and what proposals he has to compensate the Fund for that loss. [118934]
§ Dawn PrimaroloBudget 2000 confirmed that the climate change levy will be introduced from April 2001 and the aggregates levy from April 2002. The revenues from these levies will be recycled to business through cuts in employer NICS of 0.3 and 0.1 percentage points respectively. This is consistent with the Government's approach to shifting the burden of taxation from "goods" such as labour to "bads" such as environmental pollution.
The estimated costs of the reduction in employer NICS for each year until 2010–11 are shown in the table. This represents the costs of a 0.3 percentage point reduction in employer NICS from April 2001 and a 0.4 percentage point reduction from April 2002.
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£ billion Year Exchequer cost of reduction in employer NICS 2001–02 1.0 2002–03 1.4 2003–04 1.5 2004–05 1.6 2005–06 1.7 2006–07 1.7
£ billion Year Exchequer cost of reduction in employer NICS 2007–08 1.8 2008–09 1.9 2009–10 2.0 2010–11 2.1 The Treasury Grant provides a mechanism for the balances on the fund to be maintained at the level recommended by the Government Actuary as the appropriate minimum balance.