HC Deb 27 July 1976 vol 916 cc194-5W
Mrs. Wise

asked the Chancellor of the Exchequer what estimate he has made of the additional costs which will be incurred by the public sector in their purchases of goods from the private sector when the manufacturers increase their prices to compensate for the increase in the employers' share of the national insurance contribution.

Mr. Joel Barnett

If full advantage were taken of the provisions of the Price Code, the prices of goods and services purchased by public authorities could eventually rise by about 1 per cent. more as a result of the increase in the employer's national insurance contribution announced on 22nd July 1976.

Mrs. Wise

asked the Chancellor of the Exchequer how much revenue he estimates will accrue from the proposed increase in the employer's share of the national insurance contribution; and how much of this will come from the public and private sectors of employment, respectively.

Mr. Denzil Davies

The addition of two percentage points to the employer's national insurance contribution will yield about £1.03 billion in a full year and about £910 million in 1977–78. These figures exclude receipts in respect of employees in the non-trading public sector. The full-year yield in respect of all public and private sector employees would be about £1.3 billion of which about £900 million will be paid by private sector employers.

Mrs. Wise

asked the Chancellor of the Exchequer what is his estimate of the effect on employment of the increase in labour costs which will be caused by the proposed increase in the employers' share of the national insurance contribution.

Mr. Robert Sheldon

I shall let my hon. Friend have a reply as soon as possible.