Johnson wins vote on National Insurance tax increase

The Conservative government has unveiled their latest plan to tackle the problems facing the NHS (National Health Service) and the English Social Care system. The government intends to fund this plan via an increase in the National Insurance contributions paid by working people, which will begin at the start of the new financial year, April 2022. The increase will apply to the whole of the UK.

The plan was passed by 319 votes to 248 in the House of Commons on 8 September 2021, aided by the Conservative party's current majority in the House. However, there were several Conservative MPs who went against the party by abstaining or voting against the bill.

What are the details of the government plan?

Speaking in the House of Commons, Prime Minister Boris Johnson referred to the plan as ‘the biggest catch-up programme in NHS history,’ aiming to tackle the lengthy treatment waiting lists which have been worsened by the Covid-19 pandemic.

Johnson stated that the plan would raise £36 billion over three years, with the money being reserved for the NHS. This would go towards ‘better screening equipment… designated surgical facilities… faster GP access to specialists…’ amongst other services and equipment required by healthcare facilities. The Covid-19 pandemic has highlighted the importance of the NHS and the workload facing healthcare workers in these times. The increase in funding for the NHS would help to reduce the strain on workers and help patients access better quality of care.

The National Insurance Increase

The Conservative manifesto for the 2019 GE explicitly stated that the party would not be increasing taxes, including National Insurance. However, this has clearly been overridden by the recent proposal. Johnson has justified breaking the manifesto promise with the Covid-19 pandemic, something which could not have been predicted when the manifesto was written in 2019.

Many people have criticised the decision to increase National Insurance contributions, as these are not paid by people who have retired from work. This means that younger working people will be paying more across the UK as a result.

Back-Bench Rebellions and The Opposition

Labour Leader Sir Keir Starmer criticised the government proposal, stating that it would impact ‘working people’ the most. Starmer linked the increase in National Insurance with the £20 decrease in Universal Credit payments set to take place, asking ‘Why is the prime minister insisting on hammering working people?’

Five Conservative MPs voted against the bill, including Jake Berry, who warned that the extra money could easily go to waste. Berry also criticised the use of National Insurance to fund the increase, describing the ‘great sacrifices’ made by young people and workers during the Covid-19 pandemic.

What you can do

Get in touch with your local and national representatives to have your views heard.

Sources

Conservatives (2019) ‘Our Plan | Conservative Manifesto 2019’ Available at: https://www.conservatives.com/our-plan

Sky News (2021) ‘PM announces 1.25% National Insurance hike to pay for social care in England’ Available at: https://news.sky.com/story/pm-announces-1-25-national-insurance-hike-to-pay-for-social-care-in-england-12401278

Prime Minister’s Office, 10 Downing Street (2021) ‘PM statement to the House of Commons on health and social care: 7 September 2021’ Available at: https://www.gov.uk/government/speeches/pm-statement-to-the-house-of-commons-on-health-and-social-care-7-september-2021

Financial Times (2021) ‘Boris Johnson brushes off Tory rebels to pass health and social care bill’ Available at: https://www.ft.com/content/033c1e21-f7d9-4495-b840-da3c625c3996

Independent (2021) ‘Johnson faces Tory backlash over ‘stupid’ plan to increase National Insurance’ Available at: https://www.independent.co.uk/business/johnson-faces-tory-backlash-over-stupid-plan-to-increase-national-insurance-b1914878.html

Sky News (2021) ‘PMQs: Starmer says Johnson’s National Insurance hike for social care reform will see care workers receive tax rise but no pay increase’ Available at:https://news.sky.com/story/pmqs-starmer-says-johnsons-national-insurance-hike-for-social-care-reform-will-see-care-workers-receive-tax-rise-but-no-pay-increase-12402081