National Insurance Contributions (Reduction in Rates) (No.2) Bill

Debate between Gavin Newlands and Tulip Siddiq

2nd reading
Wednesday 13th March 2024 Commons Chamber

[Tulip Siddiq (Hampstead and Kilburn) (Lab)]

Thank you, Mr Deputy Speaker.

Labour will always support policies that ease the burden on working people. Labour has said consistently that we want taxes on working people to be lower. That is why, two years ago, when the current Prime Minister wanted to increase national insurance, we opposed it. That is why we supported the cut to national insurance last autumn and why we will support these measures we are debating to bring down national insurance by a further 2p. Let us be clear, however, that the measures come in the context of the highest tax burden on working people since 1949—a tax burden that is continuing to rise. The British public face not just further tax rises, but stagnant growth and wages, prices still going up in the shops, and higher mortgages and rents. Indeed, this will be the only Parliament on record in which living standards have fallen.

Unwilling and unable to fix the economic mess that they have created, the Government have resorted to empty promises—pledge after pledge, but never a plan. Last week, the Chancellor made a £46 billion unfunded promise to abolish national insurance altogether, with no explanation of how he would pay for it. I look forward to the Minister explaining in his speech exactly how it will be paid for. The British people are sick and tired of Conservative spin.

Let us take the Government’s claim that a person on average earnings will be £900 better off as result of this national insurance cut, when combined with the changes made in January. That completely ignores the Chancellor’s own stealth tax rises. His decision not to increase tax thresholds in line with inflation means that the tax burden is forecast to rise by another £41.1 billion over the next five years. That fiscal drag will create 3.7 million new taxpayers by 2028-29. OBR figures show that for every 10p extra that working people pay in tax under this plan, they will get back only 5p as result of the combined cuts to national insurance contributions. As usual, the Conservatives give with one hand, and take with the other, and they expect the British public to be grateful.

Paul Johnson, the director of the Institute for Fiscal Studies, said after last week’s Budget that

“this remains a parliament of record tax rises”,

and that is before we consider the rising cost of bills, with food prices up by 25%, rents by 10% and mortgages by an average of £240 a month. Rather than people being £900 better off, as the Conservatives claim, household income is set to fall by £200 over the course of this Parliament.

A week ago, the Chancellor had the opportunity to deliver a Budget that would finally break our country out of the low-growth, low-wage, high-tax cycle that we have been trapped in because of 14 years of economic failure. The British people needed a Budget for the long term to bring prosperity and rebuild our public services, and yet the Chancellor ended his Budget with a £46 billion unfunded tax plan to abolish national insurance. That would leave a gaping hole in the public finances, put family finances at risk and create huge uncertainty for pensioners. I have not heard one attempt from the Government Benches to explain where that money will come from. I look forward to the Minister’s response, because I am sure he will break down exactly where that £46 billion will come from.

[Gavin Newlands]

If the measure is so bad, why is the hon. Lady not voting against it?

[Tulip Siddiq]

I will not take any lectures from a party that puts oil and gas companies ahead of working people. If the hon. Member wants to change his policy on oil and gas companies having priority over working people, he can intervene again, but somehow I do not think that it will change.

The last time the Conservatives implemented a proposal like this, just 18 months ago, they crashed the economy. In fact, the Chancellor’s plan to abolish national insurance contributions would cost more per year than the proposals in that disastrous mini-Budget. The Conservatives might deny it, but millions of people are still paying the price of their last ideological experiment: the typical family faces an extra £240 a month when remortgaging this year. The Chancellor’s commitment last week exposed a Conservative Government who are putting party first and country second.

Labour is under no illusions about the state of the public finances after 14 years of Conservative government. We know that if we are elected at the next general election, we will have to take tough decisions in government, but instead of the chaos and recklessness we have seen under the Conservatives, Labour will bring stability and security back to the economy. We will never make a commitment without first saying where the money will come from. We will always be honest with the public because that is the responsible approach.

I hope that the Minister, whom I like very much, will finally come clean with the British people in his response. I hope that he will finally break with his party’s irresponsible promises and endless spin. I hope that he will be honest and say that, as a result of decisions taken by his Government, the tax burden on working people is forecast to go up each year over the next five years, and that for every 10p extra that working people pay in tax under the Conservatives, they will get only 5p back. Most importantly, I hope that he takes the opportunity to be straight with the British people, as we have repeatedly asked him to do, by setting out exactly how his Government will pay for their unfunded £46 billion promise to abolish national insurance.

Rolls-Royce (Redundancies)

Debate between Gavin Newlands and Tulip Siddiq

Wednesday 10th June 2020 Commons Chamber

[Gavin Newlands (Paisley and Renfrewshire North) (SNP)]

I thought that we had just had the Adjournment debate, with the last petition from my hon. Friend the Member for North Ayrshire and Arran (Patricia Gibson); it has certainly eaten into the time available.

Following its announcement in May of a potential 6,000 job losses around the UK, Rolls-Royce last week proposed what it says is the first tranche. Some 3,000 posts across the UK are under threat, including 700 at the site in Inchinnan in my constituency. Inchinnan is a key site for the company’s maintenance, repair and overhaul—MRO—operations, as well as manufacturing compressors and seals. Such businesses provide parts and support for Rolls-Royce engines used around the world. Their output is world-class, and recognised throughout the business and the industry at large as first-rate. Under the proposals, Rolls-Royce will close the MRO business completely, and the rest of the plant will be downgraded. A total of 700 jobs are threatened, which is over half the total workforce in Inchinnan.

These plans would be a hard blow to the economy in my constituency and across the west of the Scotland. Its impact will also be felt across the supply chain, which goes right across Scotland and the UK. Just yesterday, Wyman-Gordon in Livingston announced 72 redundancies, blaming a drop in orders, including from Rolls-Royce. These are the high-value and highly skilled jobs that we are all fighting to secure for our constituencies—the jobs that Government Ministers promote so often it is almost a cliché. These jobs are the cornerstone of manufacturing in this country and have the potential to grow it further. Yet UK Ministers have been quiet—nay, silent—about what they intend to do to support the workforce and the high-value manufacturing that is so often the subject of press releases and photos of Ministers wearing hard hats.

[Tulip Siddiq (Hampstead and Kilburn) (Lab)]

The hon. Gentleman may be aware that the International Air Transport Association does not expect air travel to recover to last year’s levels until 2023. This sustained drop in demand is one reason why companies such as Rolls-Royce are considering large-scale redundancies. He may also be aware that British Airways has threatened to cut 12,000 jobs, citing reduced demand. Many of my constituents who have worked loyally for BA over many years have written to me about the fact that they are now being treated as expendable. I am deeply concerned about that. The hon. Gentleman is making a powerful argument; does he agree that we need an urgent Government intervention to ensure that jobs affected by reduced air travel are protected for the long term?

[Gavin Newlands]

The short answer is absolutely. I completely agree with the proposal that the hon. Lady outlines; in fact, it is a proposal that we have been making to the UK Government for months now. There are many estimates as to how long the industry will take to recover but, as I shall come on to say, there is no denying that the industry will face a long and slow recovery. The industry will face redundancies, but the issue is the nature of some of those redundancies. I shall certainly touch on British Airways a little later, although Rolls-Royce is the focus of my speech.