Employers

Graham Stuart Excerpts

Wednesday 11th November 2026 Commons Chamber

[Julia Lopez (Hornchurch and Upminster) (Con)]

I beg to move,

That this House believes that employers are working people and therefore condemns the Government for breaking the Labour Party manifesto commitment not to increase National Insurance by increasing employers’ National Insurance contributions; and calls on the Government to halve employers’ National Insurance contributions for under-25s.

Today, we debate a simple proposition: that employers are working people. One might have assumed it a blindingly obvious proposition, but it is one that Labour contorts itself to deny. But, then, Labour is not very good at answering obvious questions, like, “What is a woman?” or “Should someone identifying as a llama be taken seriously?”—remember that one?

Yes, the “working people” definition has really been flummoxing Labour Members. For two years, they have been bending themselves into funny shapes. The right hon. Member for Bristol North West (Darren Jones) said that a working person is

“anyone that gets a payslip, basically”.

The Secretary of State for Transport said that working people were “people on modest incomes”. The Chief Secretary to the Treasury confirmed that employers are not working people. Last week, the First Secretary cleared it all up by saying that working people

“do not have savings…and…rely on good public services.”—[Official Report, 4 November 2026; Vol. 792, c. 910.]

That might explain why the Budget hiked taxes on savers. It is a Cirque du Soleil of mental gymnastics—but why? Because in 2024 Labour decided, albeit briefly, that it would rather get elected to govern the country than continue its audition to lead the student union of Islington ring road university, so it made everyone a promise in its manifesto: no tax increases for working people. It got specific: there was to be no VAT hike and no extra rates of income tax, and Labour would not increase national insurance—no way. Just months later, up shoots national insurance to the tune of £25 billion a year. Suddenly, working people across the country are asking, “What the hell happened?”.

Labour told working people, “No, no, it’s all perfectly legit—it’s an increase in national insurance for employers, not employees.” I think that is what Labour MPs might normally call gaslighting, but since it is being done to people who contribute, work themselves silly and generally want the country to succeed, their feelings are of no concern to the Government.

[Graham Stuart (Beverley and Holderness) (Con)]

I am afraid that I must disagree with my hon. Friend. I do not think the Labour Government were gaslighting the nation. So little is their understanding of business and their ability to read an Office for Budget Responsibility analysis that they did not realise that the nearly £27 billion hit on the nation’s economy would lead to a nearly £20 billion reduction in the money that ordinary people get in their pay packets, and that the net receipt to the Treasury would be about half that—about £10 billion. They cannot add up. Perhaps my hon. Friend needs to acknowledge that they have that disability.

[Julia Lopez]

I ask for my right hon. Friend’s forgiveness. I buy into his theory more than mine; I have overestimated the Government’s capabilities.

The Conservatives’ motion says that the House believes that employers are working people, and that increasing national insurance broke Labour’s manifesto. If this was just a debate about semantics, maybe we could all move on, but the 2024 Budget has cast a shadow over every employer in every postcode, driving up unemployment and pushing up costs for everyone. It is time to start unravelling that damage, and in particular the damage that this tax increase has done to young people.

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[James Murray]

Of course they are. If the hon. Member wants to talk about defending the indefensible, I wonder how he ever stands up in this place to talk about the previous Conservative Government because that must be an insurmountable challenge. I hope that he would welcome what the Chancellor announced at the Budget to give breathing space to businesses because it will mean that more than 70,000 small retail, hospitality and leisure properties are taken out of paying business rates altogether, that pubs will have a 20% cut in their business rates from next April and that business rates for retail, hospitality and leisure premises of all sizes will either fall or be frozen in real terms. In addition to business rates, many firms will benefit from our freeze on red diesel duty and from the reduction in energy bills by up to 25% for more than 10,000 eligible businesses from next April through the British industrial competitiveness scheme. That is what breathing space for businesses looks like, alongside the breathing space for families.

As I said earlier, the bedrock of our approach—our lodestar—to the public finances is fiscal discipline. That is why the Budget set out how we will fully fund all new policy and breathing space measures for families and businesses. In deciding his approach, the Chancellor rejected broad-based tax rises, instead taking decisions about tax changes that are fair, proportionate and targeted. That included having banks help pay for the energy help for households this winter through a temporary increase to the bank surcharge and an increase in machine games duty for higher-stakes machines to help fund cuts for business rates.

[Graham Stuart]

Could the Minister confirm that, under the current regulatory regime, the £1.5 billion that will be taken over 15 months in this doubled bank tax could be lent out to a maximum of £25 billion? There is a risk that having withdrawn £1.5 billion from the banks’ equity, £25 billion—it is the maximum—in lending to the UK businesses we are talking about could be lost?

[James Murray]

I am sure the right hon. Gentleman will have been interested in our measures in the Budget for the British Business Bank, for instance, to increase access to finance, particularly for many of those businesses that are trying to scale up and increase. But I come back to this central point—I know what his position will be because he is a loyal member of the Opposition Benches and will follow what the Leader of the Opposition said on Budget day itself—which is that the Conservative party does not support our decision to require banks to pay a little more for a temporary period of time to fund household support across the country. We know that banks are coming from a strong position. It is a temporary increase. It is one that we believe is fair, targeted and proportionate. We are asking banks—requiring banks—to pay that extra amount, and they are therefore contributing towards the important support for households. What I think is sad about this debate is that the Opposition do not support that breathing space for households. I thought the right hon. Gentleman was loyal to his party leader, but if he would like to break ranks and intervene on me again to confirm that he supports our £100 household energy payment, that would be helpful.

[Graham Stuart]

The slavish loyalty of the Minister has already been remarked upon, along with the courage that goes with defending the indefensible quite as often as he has done—always with wit and good humour. Could he address this particular point? The truth is that banks are a popular target to hit with the public and with Labour Members, but if there is actually less money to go to the pubs, restaurants and small businesses in my constituency and elsewhere, can he not accept that that multiple should give people pause for thought before they go for the easy, popular target and take it out of the big, fat, rich banks, if it turns out the small business in trouble will actually lose the credit it desperately needs?

[James Murray]

I was listening carefully to the right hon. Gentleman, as I always do whenever he speaks in this Chamber, and I did not hear a response to the question I asked of him, which is whether he supports the household energy payment, which the Leader of the Opposition so clearly opposes. I invited him to intervene to clarify his position given there seems to be some confusion on the Opposition Benches around the household energy payment and whether they support it or not. I would have thought that given the Leader of the Opposition was so clear in not supporting the household energy payment, the hon. Gentleman—

[Graham Stuart]

Right hon. Gentleman.

[James Murray]

I would have thought that the right hon. Gentleman—excuse me—would have no difficulty in rowing in behind her, but he seems to be struggling with that somewhat, so I will make some progress.

I was speaking about the fiscal discipline that underwrites everything we are doing as a Government. Through the approach that we took in the Budget, we have maintained our fiscal rules while making no changes to rates of income tax or national insurance on income from employment or self-employment, or to the rate of national insurance that employers pay on wages or salaries for their staff.

--- Later in debate ---

[Daisy Cooper]

The hon. Gentleman will, I hope, accept that growth in one country is not equivalent to growth in another country. When we tear down barriers between countries, we increase growth. Plenty of modelling has been done by the national economic social research unit in America, and by other bodies in this country. I am not sure, but I believe it is PwC that has talked about the amount of growth we would gain from the single market. We believe that joining the single market and the customs union would bring in about £29 billion and that the cost would probably be about £2 billion, so the growth that we would gain would massively exceed the cost of joining.

[Graham Stuart]

Does the hon. Lady agree that the Liberal Democrats are a singularly special party in this place, because they can believe passionately in something and then not vote for it?

[Daisy Cooper]

I am sure that if I had more time to speak in this debate, I could point to a number of examples of the Conservative party saying one thing and doing another. It is, of course, a party that is trying to claim, after the mini-Budget, that it is reclaiming the brand of fiscal responsibility, but even in the Conservatives’ recent spending plans there is, according to my calculation, a £33 billion hole between their funding pledges—or the things they want to fund—and the tax cuts that they want to make. It looks like Trussonomics 2.0.

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[Dr Sandher]

I apologise, Madam Deputy Speaker.

[Graham Stuart]

rose—

[Dr Sandher]

I will give way, because the right hon. Member has been very patient.

[Graham Stuart]

. The hon. Member is being most generous in giving way. He is a fair-minded man, so, on outcomes, I am slightly surprised that he picks this figure of 1 million more people in work; the numbers from His Majesty’s Revenue and Customs show that the payroll has reduced by 165,000 people since July 2024, and that the number of unemployed people has gone up by 225,000. In fairness, would he make sure that he does not just pick the one statistic that he thinks helps his argument?

[Dr Sandher]

I choose to use the labour force survey statistic because it includes both the self-employed and those who are low-paid and do not appear in the PAYE figures. I pick that figure because it is more comprehensive, and I believe it is more correct, as it includes everybody in work.

I want to briefly pick up the point about unemployment. The right hon. Member is right to say that both employment and unemployment have increased, but that in part is good news; it is because those who were economically inactive are now seeking work, so they are now in the category of “unemployed”, rather than “inactive”. We have more people in work, and more people looking for work.

Our argument is that, for businesses to create prosperity, they need not just lower taxes—I take the Opposition’s point on that—but the sales and the foundations to create prosperity. They need a healthy workforce. That is why we are investing in the NHS and waiting lists are falling. They need good skills, which is why the number of apprenticeship starts in this country is such a focus for this Government. They also need lower energy costs, which means providing home-grown, cheaper, cleaner energy. Those things help employers produce more in this country, and help businesses hire more people.

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[Graham Stuart (Beverley and Holderness) (Con)]

It is a pleasure to take part in this debate, Madam Deputy Speaker.

I started my business at the end of my first year at university. By my third year, it was paying me more than I thought any employer sensibly would—that is, if anyone would be foolish enough to take me on in the first place—so I carried on building that business, with no business experience and no knowledge of how to do anything. I had to learn everything from scratch. Lloyds became my business bankers, and although they were supportive, the sight of the black horse on an envelope was enough to make my palms sweat from sheer stress. All it takes is for the bank to withdraw its support, and your whole business—all your hours, hopes and dreams—are gone.

The Minister is unusual in having some feeling for and understanding of private business. One of the problems is that Government Front Benchers in particular, and the parliamentary Labour party overall, do not. If you do not understand the dynamics of a business—the pressure and the reality of trying to build a business—you will not understand why people were outraged by the Chief Secretary to the Treasury’s remark about employers not being working people. That outrage is not fake; it is real and visceral. Their sense of disappointment in their Government is so strong. Many of them will have voted for this Government, based on their promise that growth would be the No. 1 thing, and that tax would not be put up. It sounded great in the manifesto. Those people feel betrayed by the lack of understanding and empathy for the fact that they are risking everything, including the home that they share with a spouse, who has to sign up as well. They have put all that on the line to create a business. That is the only way to create wealth. The state facilitates—through the rule of law, decent health services, education and the rest of it—but it does not deliver wealth. That can only come from the private sector, and that failure of understanding and personal experience has led to this desperate situation.

The previous Chancellor, the right hon. Member for Leeds West and Pudsey (Rachel Reeves), made a manifesto pledge that must have been made because some public relations person told Labour, the weekend before the election, that if it did not make that pledge, it might not win, and not to be complacent: “Let’s promise not to put tax up on working people.” The Government then broke that pledge by coming up with the clever wheeze of putting tax up on employers, with no understanding of what that would do.

The arithmetic is really depressing. The £26 billion hit to the economy meant that there was not £26 billion to spend on the NHS. It turned out that the increase did not even raise the £16 billion that, according to the OBR, it should have, once the cut in corporation profits and so on was accounted for. The Government then had to compensate the public sector, which brought the figure down to £11 billion or £10 billion. Then they said, “Oh, no, hospices and GPs are not technically part of this,” so they had to find more money. Single-digit billions is all that the Government got for putting a £26 billion or £27 billion brake on the economy. It is utterly insane.

It is noticeable that smaller and smaller numbers of Labour MPs want to come to the Chamber to defend that decision. I congratulate those who have, on their party loyalty if nothing else, but when I talk to Labour colleagues outside this Chamber—if I have a chat with them in the bar, for example—I struggle to find any Labour MP who says, “That was a really good idea. That was the best way of raising money.” They will defend the need to raise money to stick into the health service, repair the “dreadful 14 years” and so on. They buy into that still, but they do not think that putting tax up on employers was a clever way of raising money, because it did not raise very much, it was an enormous brake on the economy, and it has been devastating. It has been most devastating for young people.

[Alistair Strathern (Hitchin) (Lab)]

indicated dissent.

[Graham Stuart]

If the hon. Gentleman wants to intervene on me, I would be delighted to let him come in.

Yesterday, the deputy governor of the Bank of England said that one of the reasons why youth unemployment has gone up faster than unemployment generally—remember, because of that gigantic brake on the economy, overall unemployment has gone up by 250,000 under this Government—was the cost of employing young people, including because of the minimum wage, the jobs tax and so on.

[Dr Luke Evans]

Would my right hon. Friend care to comment on the state of the graduate market, too?

[Graham Stuart]

The situation is affecting all young people, is it not? I have used this quote in the Chamber before, but it is worth repeating, even for the tiny number of Labour MPs who were prepared to come here, to vaguely try to support the Government. Ronald Reagan said about the left:

“If it moves, tax it. If it keeps moving, regulate it. And if it stops moving, subsidise it.”

Labour taxed it with a jobs tax; then it regulated it with the Employment Rights Act 2025 until it stopped moving. Then young people were not getting employed anymore. Labour said, “Yippee!” Labour MPs were literally going around the TV studios saying, “Look at us—there is a jobs guarantee.” They have taxed it; they have regulated it until no one is getting employed; and now they will say, “We will subsidise it.” They have absolutely no conception of how private enterprise works, or how the economy works. They are letting the country down, and they increasingly know it, albeit that they do not say so in the Chamber quite yet.

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[Blair McDougall]

We recognise that and, as was mentioned, we are providing additional resources throughout the NHS and hospices to help with that.

On relief for employers, hon. Members will know that the employment allowance was estimated to be worth £7.4 billion in 2025-26. That provides eligible employers with up to £10,500 a year towards their national insurance contribution bills.

That is obviously not the only help that we gave to businesses in the Budget. As my hon. Friend the Member for Norwich North (Alice Macdonald) noted, we have lifted tens of thousands of businesses out of business rates. Several hon. Members raised concerns about youth unemployment.

[Graham Stuart]

Will the Minister acknowledge, because he not only has the ear of business but is a very honest Member of this House, that, notwithstanding the talk about support for business and the 70,000 businesses that have been mentioned, overall the Budget raised the tax on business by another £2.2 billion, on top of the £66 billion that came in the two previous ones?