I am delighted by the Chancellor’s statement today to abandon the proposed increase to Class 4 NICs. I met with him to stress the voice of Wiltshire’s self-employed and he listened. The self-employed do not have an auto enrolment pension scheme, benefits such as sick pay and holiday pay or security of income. These issues need addressing first before there are any changes to NICs for the self- employed.
The changes would have only meant that the average self-employed person pays 60p more a week but I was not convinced by the change. Originally the self-employed paid less National Insurance because they received lower state pensions, this has now changed and was a key reason to change NICs. However there is still not parity in pensions because the self-employed are not eligible for auto enrolment (something I have campaigned for over the last 2 years) and thus must still seek to take out a private pension. I met with the Chancellor to stress this because we need to either address this or keep NI lower for the self-employed so that they can take extra pension provisions. The second argument used is that the self-employed can claim more against their tax, yes but they do not get sick pay, holiday pay and they do not have any security of income.
The Chancellor listened and announced today that there will be no increase to Class 4 NICs in this Parliament and that we will still abolish the regressive Class 2 National Insurance Contributions. This was a great win – one for my local residents and will mean the majority of local self employed will now take home more money.
We do need to recoup more money to pay for things like the adult social care bill but I think the answer lies with the international tax avoiding corporations rather than the self-employed. I stressed this in my meeting with the Chancellor because so far we have done a great deal to clamp down on large international companies who have avoided paying tax in the UK but we need to go further so they pay their full fair share. I will continue to be a strong voice for the hardworking local people of my constituency and that includes the self-employed.