New clause 4 - Self-employed
State Pension Credit Bill [Lords]
2:45 pm
Professor Steve Webb (Northavon, Liberal Democrat)
Only to a point, in that I do not disregard the employer. Clearly an individual makes a choice to become an employee with an employer who effectively knocks the 10 per cent. off his wages. In a sense, the employee is paying the combined amount, so there might be some convergence. However, I would still argue that the difference between 7 per cent. class 4 and 20 per cent. class 1 in terms of employee plus employer is hugely relative to the difference in benefit. While I agree that the state second pension should be the province of the self-employed, there might need to be an offsetting national insurance rise. However, the new clause is quite proper. It is important that the Government respond to concerns about the pension position of the self-employed and I welcome the opportunity to debate it this afternoon.