It’s been a thorny issue. Covid-19 has cost billions, while social care has long been the Cinderella service. It is obvious that more money is needed to help both sectors; solutions are needed, but was this the right way forward? To increase National Insurance contributions for employers and workers?
Seems so as a majority of (Conservative) MPs voted yes on Health and Social Care Levy, including North Cornwall’s Scott Mann. There were 317 ayes and 248 ‘no’ votes, after it was rushed through the Commons which little chance for thought or discussion.
All Cornish MPs voted in favour of the levy. Whatever your thoughts on this extra tax, it is manifesto-breaking, which is important.
The Prime Minister has so far broken the following commitments he made pre-election:
- Reduced overseas aid
- Trashed the triple lock on pensions
- Broken his promise not to increase National Insurance contributions
In addition, he appears to have no ‘oven ready’ social care plan, as he declared.
You can read the parliamentary debate (much hot air, little quantification) here.
In summary, the Government has announced a new 1.25% health and social care levy based on national insurance contributions. MP, Jake Berry, asked the pertinent question of how much the rise will cost the NHS on top of its current payroll cost. It seems not to have been factored in.
For a couple of years this tax revenue goes to the NHS, not to care, to get the waiting lists down (not quantified). Care is left in the doldrums once again: care of the aged, and the vulnerable of all ages.
The levy will apply UK-wide to taxpayers liable to class 1 employee and employer, class 1A, class 1B and class 4 self-employed NICs. However, it will not apply where taxpayers pay class 2 NICs or class 3 NICs. It will be introduced from April 2022, and then from April 2023 the levy will also apply to those working over the state pension age. From April 2023, once HMRC systems have been updated, a formal legal surcharge of 1.25% will replace the temporary increase in NICs rates, which will return to their previous level.
Shadow Chancellor, Rachel Reeves, pointed out:
There are two tests for the package announced yesterday. First, does it fix social care? Secondly, is it funded fairly? The answer to both those questions is no. It is a broken promise, it is unfair, and it is a tax on jobs. At the general election less than two years ago, the Prime Minister said to voters:
“Read my lips, we will not be raising taxes on income or VAT or national insurance.”
“this Government are not going to raise the rates of income tax, national insurance or VAT…Nobody’s take-home pay will be less than it is now”.—[Official Report, 3 March 2021; Vol. 690, c. 256.]
The reality is that Scott Mann and others voted to break their own manifesto promises, once again.