Employers

John Hayes Excerpts

Wednesday 11th November 2026 Commons Chamber

[Julia Lopez]

The hon. Gentleman has no doubt been to his constituency and been denied access to pubs, salons and all the rest of it, and that has suddenly changed his mind about what constitutes “a working person”. I should ask: are his constituents seeing those better public services? Certainly, mine are not, and they wonder where all that money has gone because it has not gone on more stable public finances or better public services.

Let us start by acknowledging what it takes to be an employer. It takes someone who saved money to start a business of their own and who took a risk to expand it gradually to take on that first member of staff, then over time building a team. It takes long hours, personal sacrifice, financial peril, time away from their family.

[Sir John Hayes (South Holland and The Deepings) (Con)]

My hon. Friend characterises a picture that might be seen in every constituency among small and medium-sized enterprises. Sometimes, people imagine business as consisting wholly of globalist corporate plutocrats, but the backbone of our economy is made up of those small and medium-sized firms of exactly the kind that she describes. On the issue of public services, why does the Labour party not focus on productivity? It is not wholly about what we spend; it is what we get for what we spend.

[Julia Lopez]

I agree with what my right hon. Friend says. That characterisation of employers is why Labour gets itself into such problems in the first place. He talks about the issues relating to national insurance and public services. The NHS also has to pay a higher national insurance bill because of the changes that the Labour Government have made, and that has caused all kinds of challenges across the public sector.

--- Later in debate ---

[Julia Lopez]

The hon. Gentleman is absolutely right to point that out. It is inconceivable that the Government would not have been told about the impact that this policy was likely to have.

Labour likes to point out that employers do not pay national insurance on workers under 21, but that misses the point. Employers are making decisions about their entire workforce, and when the cost of employing people rises and the risks associated with taking on a new starter increase, the first opportunity to disappear is the one that will no longer be created. Rather than take on an extra employee at junior level, employers are squeezing the staffing resource they have, but they are shedding younger workers, too. By 2027, employing a full-time minimum wage worker over the age of 21 will cost a business 20% more than it did when Labour entered office. For an 18 to 20-year-old, it is 31%.

Labour knows that there is a problem, but rather than tackle it at source, it offers up the youth guarantee, a bung to employers to take on a young person for six months. How about making it cheaper and easier to employ that young person in the first place? Soon we will get details of an unlimited youth mobility scheme with the EU to add to this mix, which will see young Britons competing for available work with peers from 27 other nations.

The cost of all this must be absorbed somewhere. Higher national insurance, soaring energy bills and a growing burden of regulation all feed through into the price of doing business and, ultimately, the price we all pay. The weekly shop costs more, a meal out costs more, getting your hair done costs more, activities with the kids cost more, as does going away for a few days. This is just one of the reasons that household finances are going backwards. Whether Labour is talking about employer national insurance or employee national insurance, everybody pays at the end of the day.

We Conservatives want more working people, because work is dignity, contribution, resilience and confidence, and we want that opportunity for as many young people as possible. We want to end the waste of a generation unable to showcase its talents, and we want to reduce the cost on a generation of workers that can bear no more tax on its shoulders. That means returning to some of the policies that are driving this destruction. Not only would we repeal the job-destroying provisions of the unemployment Act; we Conservatives would halve employer national insurance for under-25s. Our policy would permanently reduce the cost of employing young people and give businesses a real incentive to take them on. For an employer, it would be a saving of around £1,500.

This is part of a wider plan to tackle Labour’s youth jobs emergency. Our “Get to Work” scheme would stop young people leaving education and drifting straight on to welfare. It would create 100,000 new apprenticeships, cut red tape to save the Saturday job and reduce high street business rates to support the businesses that give young people their first step on the jobs ladder—a policy that would benefit not 70,000 high street businesses, as Labour’s policy would, but 250,000.

Aside from old prejudices about employers as the oppressors of workers, the reason that Labour contorts itself on the definition of working people is that it knows it has taxed them silly. In doing so, it has not just broken its manifesto commitment but completely undermined what Keir Starmer and his sparkling new Chancellor used to say was Labour’s No. 1 priority: growth. The consequences are there for all to see in the unemployment figures and the living despair of young people unable to secure a good job.

[Sir John Hayes]

My hon. Friend is making a fundamental point about the structural effects of this policy: of course, it affects profitability year by year, but it also undermines the capacity of businesses to reinvest and ensure structurally that they are fit for the future. A butcher in my constituency, Andrew Parsons of Bennetts Butchers, is closing the shop in a couple of weeks after more than 100 years of trading, because, as a result of the costs lumped on him by successive Governments but particularly by this one, he does not have the money to reinvest.

--- Later in debate ---

[James Murray]

I will come to that later in my remarks. Employers do not pay national insurance contributions for under-21s, because of the relief that already exists, or for apprentices under the age of 25. That goes some way towards supporting the objective that the hon. Lady mentions, which is to ensure that employers are supporting young people into work. I agree with her comments about the state in which the Conservatives left high streets across the country, having not done what was necessary to support them over 14 years.

Businesses across the country are the ones who drive economic growth, and every employer across the country knows the importance of fiscal discipline. It is crucial in enabling them to succeed, just as it is the crucial bedrock of economic stability for the country and the foundation that we need to support confidence and long-term growth.

[Sir John Hayes]

Will the Minister give way?

[James Murray]

I will give way one more time, then I will make a bit of progress.

[Sir John Hayes]

The Minister is being immensely generous in taking interventions. Employers in my constituency include many farmers and growers and related food firms and hauliers, yet much of the land in my constituency is threatened with immense solar developments, which will take that land out of production. That threatens the country’s food security, and we risk making energy security the enemy of food security. That is bound to undermine our economy in the long term, as we import more and more of what we need to feed the nation. Will he take a look at that, discuss it with colleagues across Government and see how we can reverse that trend? It puts our national economic resilience at risk.

[James Murray]

While I agree with the right hon. Gentleman drawing attention to the importance of food security as part of our national security, he and I take a different approach to energy security. The reforms that we are implementing as a Government, including through investment in home-grown, independent sources of energy to increase our energy security and make us more independent from fossil fuel prices around the world, are crucial to bringing bills down over time and ensuring greater energy independence and energy security. That is what the Government are doing, and that is how we see ourselves responding to one of the greatest pressures that many households and businesses face: the immediate and long-term costs of energy.

I was talking about employers recognising the importance of fiscal discipline in their own businesses, just as the Government recognise the importance of fiscal discipline for the country. We know that this Government inherited a crisis in our public services, our public finances and the cost of living. NHS waiting lists were at record levels, children worked in portacabins as school roofs crumbled, and rivers were filled with polluted waste. Billions of pounds of spending commitments had not been funded or even properly disclosed to the Office for Budget Responsibility. Faced with that reality, any responsible Government would have to act. We kept our manifesto commitment to working people not to increase their income tax, their national insurance or VAT, and we went further by freezing fuel duty and raising the national minimum wage.