Only a few days to go: We’re raising £25,000 to keep TheyWorkForYou running and make sure people across the UK can hold their elected representatives to account.

Donate to our crowdfunder

Social Security

Part of Ways and Means – in the House of Commons at 10:55 pm on 20th December 1983.

Alert me about debates like this

Photo of Dr Rhodes Boyson Dr Rhodes Boyson , Brent North 10:55 pm, 20th December 1983

I shall be short and sharp. Hon. Members on both sides of the House have put the arguments backwards and forwards. I am not sure that we have convinced one another, but at least we now know where the arguments lie.

The hon. Member for Roxburgh and Berwickshire (Mr. Kirkwood) mentioned the cost of the national insurance contribution scheme. Its running costs have increased by about 8 per cent. this year as there are more demands on staffing and general costs. The balance in the fund at any time is really enough for only about 10 weeks' expenditure on benefits. That seems reasonable. Most businesses run on larger balances but that is what the Government Actuary has accepted and we work with him.

My hon. Friend the Member for Mid-Kent (Mr. Rowe) mentioned helping the self-employed. I received his message. Like the hon. Member for Birkenhead (Mr. Field), he mentioned the work traps. I remain in political sympathy on that matter with my hon. Friend who reminded our party of the direction which we should take. I am not sure that I find myself completely in sympathy with the hon. Member for Birkenhead although I respect his views. I appreciate the point about the regressiveness of taxation.

Under the Labour Government, the employer's contribution was increased from about 8·5 per cent. to 12·6 per cent., while the employee's contribution increased by only 1 per cent. We have balanced those contributions up, although that might not be popular with some Opposition Members. The incentive to work concerns both sides of the House. The Exchequer contribution to the fund is not the total extent of Government expenditure. If we reached a stage when 44 per cent. of the fund was paid for by the Government, it would be a burden.