§ Ms MahonTo ask the Secretary of State for Social Security what assessment he has made of the extent of anomalies in the benefit system caused by the extent of a person's NI contribution liability depending on the length of the pay interval or earnings period; and if officers are allowed to exercise discretion in cases when the person would have satisfied the qualifying conditions for benefit had the pay interval been different. [35266]
§ Mr. HealdWe have made no assessment of the effect of different earnings periods on the qualifying conditions for benefit. However, we are aware that cases can arise where someone just fails to qualify because he is not liable to pay national insurance contributions on earnings in a particular pay period.
Broad rules are inevitable in a national insurance scheme which must cater for a wide variety of methods by which earnings may be calculated and paid. The earnings period for national insurance contributions is the interval at which an employee is normally paid. The interval of payment depends upon the employee's contract of employment with the employer. When an employee starts work, the expected regular earnings period operates from the outset even if the employee starts work part way through that period. The Secretary of State has no discretionary powers to alter the earnings period in these circumstances.
Arrangements already exist within the national insurance system which may help someone to qualify for benefit in certain circumstances. For example, if an employee starts work towards the end of the tax year and the salary is paid after the end of the tax year, there are provisions which enable the Secretary of State to re-allocate primary (employee) class 1 contributions from one tax year to another.