It is a pleasure to serve under your chairmanship, Dr McCrea. I welcome all Committee members to this afternoon’s deliberations, particularly my hon. Friend the new Member for Heywood and Middleton. I hope that she will get a flavour of proceedings on finance matters, although the amount of time that we take might not reflect the length of other debates in which the Minister and I have been engaged in the past few weeks and months.

I suspect that this afternoon’s deliberations will be as efficient as those on Second Reading. To that end I am grateful to the Minister, his officials and all the other witnesses who gave evidence this morning in what was a very useful and helpful oral evidence session that dealt with many of the technical points about the legislation that were raised by various stakeholder groups, including the Chartered Institute of Taxation and the Low Incomes Tax Reform Group. They were concerned about some of the effects of the simplification measures; we heard  good clarification on those points. I am grateful to the Minister for his introduction to Clause 1 and schedule 1, along with the Government’s amendments.

For self-employed people—the Office for National Statistics believes there to be about 4.6 million of them—the existence of two separate systems for the collection of class 2 and class 4 NICs is undoubtedly an administrative burden that they could do without. Most self-employed people are already juggling a huge number of balls, so we welcome proposals that aim to make their business lives easier. This is not a new area of debate, and the proposed changes we are discussing today follow a change in April 2011 that sought to ease the administrative load by aligning the dates on which payment of class 2 NICs is due with the dates for tax under self-assessment—moving them to 31 January and 31 July. The changes before us build on what has gone before.

The particular change that we are discussing today was raised by the Office of Tax Simplification in its review of small business taxation. In various work in 2011-12, the OTS noted the advantages of making the simplification change, the foremost of which was that reforming how class 2 NICs were assessed and collected would alleviate problems for many self-employed persons who find that they are obliged to apply for a refund of overpaid national insurance at the end of the tax year. The OTS also found that there could be simplification and cost reductions for HMRC and small businesses in combining the collection process and the self-assessment return. HMRC estimates that collecting class 2 NICs in that way should cut the administrative burden on businesses by around £19 million a year, thereby directly benefiting 4.6 million self-employed people.

After the legislation was published, a number of concerns were raised, particularly by taxation stakeholder groups, about the maternity allowance and the interplay between the changes and universal credit. I am very grateful to the Minister for dealing with all the points that were raised on Second Reading, some of which came up this morning in the oral evidence session. He provided some helpful clarification on the issues raised, including some reassurance that pregnant women will not miss out and that people will not find themselves disadvantaged, particularly in relation to universal credit. The point that remains outstanding from our discussions this morning relates to how these changes will be communicated, both to the wider group of the self-employed, who will have to get used to doing things differently—it is simpler, but they will still have to have the impact of the change communicated to them—and to pregnant women and people on very low incomes, who will have to think about the impact this will have on universal credit.

Witnesses who gave evidence this morning all pointed out that the rules can seem quite complex and are not well understood by members of the public, including, sometimes, the rules on eligibility for different types of benefits from voluntary contributions under class 2 and class 3. As we heard from Mr Hubbard, it is not immediately obvious what the different voluntary payments entitle people to. The Minister’s officials helped us out with that, but it shows that even the experts struggle to navigate this landscape. It would be helpful if the Minister would build a bit on some of what we heard this morning in relation to communication.

Ms Edwards, the DWP official who attended the session this morning, provided some information in outline about how these changes will be communicated to those on very low incomes and those on benefits. I was a little worried that some of what she referred to related to online communications. We know that self-employed people on very low incomes and those on benefits are often digitally excluded. Online communication is a method of choice in the modern age, but it means that those who are excluded might not be able to access the information they need. I was not completely convinced that the helpful oral advice that is sometimes necessary will be available, rather than just something in writing or on the internet. It would be helpful if the Minister would set out some further thinking and more practical information about what is going to happen for the people who will be affected in that way.

Similarly, I am very grateful for the clarification about the working of the maternity allowance as a result of these changes. It would be helpful to hear more detail from the Minister on communication to pregnant women. There is a wider point about communication to everybody who is going to be affected. Mr Whiting from the Office of Tax Simplification suggested that his dream scenario for communication of these changes would involve at least three separate letters to all self-employed people by HMRC. Is that something that the Minister is planning? Have letters already been prepared? Has anything gone out already to tell people that these changes are coming? Will he take steps to ensure that people understand some of the complexity around voluntary contributions and what they entitle people to? As the rules engage a bit more, we do not want people to miss out because they fail to understand the impact of the simplification.

As I say, it would be helpful to hear more detail from the Minister, particularly on communication, but he has helped on many technical issues, for which I am grateful, and we support the simplification measures in the Bill.