§ Miss McIntoshTo ask the Chancellor of the Exchequer what estimate he has made of the number of employees whose liability for national insurance contributions will rise by 2001–02 as a result of the reforms to employees' NICs introduced in the (i) 1997, (ii) 1998 and (iii) 1999 Budgets. [94317]
§ Dawn PrimaroloThere were no measures in the 1997 or 1998 Budgets which increased the MC liability of employees. In fact, the 1998 Budget included the abolition of the 2 per cent. "entry fee", which would have cost all NIC payers about £1.40 per week in 2001–02 had it remained in place.
In the 1999 Budget, the Chancellor announced a number of changes for NICs. The point at which people start paying NICs and the upper earnings limit will be increased by more than indexation in April 2000 and April 2001, so those 16.6 million employees earning between £69 and around £540 per week will be liable to less NICs and 3.9 million employees earning more than around £540 per week will be liable to more NICs. The rise in the starting point for employees' NICs necessitates a rise in the upper earnings limit, to maintain the historical relationship between the two points and thus protect the base for such contributions.