§ Mr. GibbTo ask the Secretary of State for Social Security what estimate she has made of the cost of aligning the employee national insurance contribution lower earnings limit with the income tax personal allowance set out in paragraph 3.31 of the Financial Statement and Budget Report. [36310]
§ Mr. DenhamI refer the hon. Member to the reply I gave to the hon. Members for Northavon (Mr. Webb) and for Havant (Mr. Willetts) on 23 March 1998,Official Report, column 70.
§ Mr. FlynnTo ask the Secretary of State for Social Security what effect the changes announced in his Budget will have on the income of the National Insurance Fund for 1999–2000. [35922]
§ Mr. DenhamThe proposed changes to employer's National Insurance contribution from April 1999 are revenue neutral for employers as a whole. The changes to employees' contributions will reduce contribution revenue to the National Insurance Fund by £1.2 billion in 1999–2000; a £1.4 billion full year effect.
Source:
Government Actuary's Department.
§ Mr. WebbTo ask the Secretary of State for Social Security if it is her policy to maintain the contributory principle in the benefit system for the long term. [36022]
§ Mr. DenhamWe are modernising National Insurance contributions to encourage employers to take on staff and to make work pay for employees. My right hon. Friend the Chancellor of the Exchequer announced a series of changes to promote these aims in the Budget on 17 March. Changes to the National Insurance scheme provide an opportunity to update the contributory principle. We will examine the link between paying contributions and earning entitlement to benefits with a view both to simplifying further the administration of the scheme for employers, and emphasising the link between work and earning benefit entitlement.