National Insurance Contributions (Increase of Thresholds) Bill — House of Commons, 2022-03-24
Topic: Macroeconomics
Matthew Raymond Western (Labour, Centre-left): It is a pleasure to speak today, having been unable to get in yesterday Clearly, as we have heard from across the Chamber, a lot of people are hurting right now. Some might suggest that Warwick and Leamington would be deemed a relatively prosperous community, but there is real deprivation in all our communities. It is those who are on the lowest incomes, the pensioners and those on welfare, who will be—who are being—hit hardest While I can see the Chancellor is an ambitious individual, what was most disappointing about his statement yesterday was that, with the exception of the removal of VAT on solar panels and renewable heat systems and the 5p reduction in fuel duty, there was very little in it. That is particularly disappointing because we are in the middle of a cost of living crisis, and he could have been seen to be more obviously looking to support others. It must be difficult, being a relatively wealthy individual, to be able to see what is going on in the households of ordinary working people and the hardship that they are currently facing I was really surprised about the windfall tax because, to me, it seems like an open goal—an obvious thing to do. I have heard the comments of Conservative Members about the windfall tax and the need for large oil and gas companies to reinvest profits—of course, and those businesses will be doing that. Their profit forecasts were looking fairly good this past 12 months anyway, but they have risen significantly because of the dramatic rise in the international price of a barrel of oil. That is terrific for the businesses in that sector. It is fortunate for them to be there at this time, but it has significant consequences for the households of our constituents— our hard-working families who are trying to make ends meet We have heard the comments about those businesses having to reinvest profits, and of course they would be doing that. I sincerely want them to look at new hydrogen facilities and electric vehicle charging infrastructure, and they are, but we need to rapidly upgrade those plans, and I am sure the Government will be looking at that and talking about it in the coming days. That needs to be done, and I hope the companies and the Government will be much more ambitious than they have been to date. The upsurge in profits from the increase in the price of oil has essentially equated, as the chief exec of BP said, to a cash machine for those businesses that they have then used to increase dividends, understandably, but also to go on to a very aggressive plan of share buy-backs. That is what a lot of corporates do—I get that—but, as my Front Benchers and I have been saying, that money could have been put back in and used to alleviate the very real, very immediate pressures on households up and down the country The IFS says that yesterday’s announcements were really like the Chancellor giving with one hand yet taking away with the other. Paul Johnson said that the decision to raise national insurance contributions and cut income tax drives a "further wedge between taxation of unearned income and earned income." That relates to my point about the dividend increases that we have seen in other parts of the economy.