Question to the HM Treasury:

To ask the Chancellor of the Exchequer, with reference to line 26 on page 118 of the Autumn Budget 2024, HC 295, published on 30 October 2024, if she will disaggregate the measures of (a) changing the Secondary Threshold to £5,000 and (b) increasing the employer National Insurance rate by 1.2% for each financial year to 2029-30.

The static revenue of increasing the Employer National Insurance rate from 13.8% to 15%, and reducing the Secondary Threshold to a £5,000 annual equivalent are set out below.

This is a subset of the static costing published in table 5.1 of the HMT Budget documents, and table 3.2 of the OBR Economic and Fiscal Outlook, October 2024, and does not account for direct or indirect effects from the wider package. The cost of increasing the rate is calculated before any other parts of the announced package of Employer NIC changes have been calculated – and so assumes the Secondary Threshold and Employment Allowance remain unchanged. The cost of reducing the Secondary Threshold accounts for the higher rate of Employer NICs, but does not account for changes to the Employment Allowance.

In addition to the changes outlined above, the Government has protected the smallest businesses from the impact of the increase to Employer National Insurance by increasing the Employment Allowance from £5,000 to £10,500, which means that 865,000 employers will pay no NICs at all next year, more than half of employers will see no change or will gain overall from this package, and all eligible employers will be able to employ up to four full-time workers on the National Living Wage and pay no employer NICs.