National insurance rise: MPs vote through plans to raise taxes

Despite the plans passing easily, MPs from across all parties clashed over the measures to fund social care and the NHS in England.

During a debate on the reforms this evening, SNP MPs have said the charges are an unfair tax on Scottish workers and argue there are better ways of raising funds.

Labour will not support the measures, which are set to raise £12bn a year in their first three years, while Conservative MP Jake Berry was among the Tories who said they cannot back the plans either.

However the Scottish Conservatives are to back the plans, arguing they will deliver £1.1bn a year for the NHS in Scotland.

Papers setting out the plan said the new tax will operate UK-wide, and that "there will be a legal requirement to allocate the levy revenues for spending on health and social care" in Scotland.

This has been seen by SNP MPs as an attempt to impose measures on the Scottish Parliament in the devolved area of health.

Dr Philippa Whitford, nationalist MP for Central Ayrshire, said the UK Government’s “obsession with outsourcing” did not “match the Scottish vision for health and social care” and said ministers were “taking power away from the Scottish Government”.

Alison Thewliss, the SNP’s finance spokeswoman, said the Conservatives were “absolute masters of illusion and deflection” and added: “Very few people would dispute the need for action on health and social care in England. However, an increase to national insurance contributions is not the fairest way to go about it.”

Ms Thewliss, MP for Glasgow Central, cited research which claims the policy would benefit the south-east of England the most, and added that the effects would be “compounded in Scotland”.

She said: “The Prime Minister is proposing that Scottish tax contributions be used to fund England-only policies. My constituents and people across Scotland are generous people, and I am sure that very few of them would begrudge the principle of funding the NHS and fixing social care after the pandemic, if indeed they had any faith that this Government were capable of fixing anything.

“But as things stand, the Scots, Welsh and Northern Irish stand to be taxed twice.”

She said the priorities of the UK government were not the same as those in Scotland, Northern Ireland or Wales, and added: “SNP Members cannot support measures that are so manifestly unfair to our constituents and whose financial consequences amount to a pig in a poke.”

John Lamont, Scottish Conservative MP, challenged Ms Thewliss over her claims and suggested she did not want the policy to go ahead as the SNP had not asked for extra funds.

He said: " We have heard much over the past few days and the past few hours from those on the Scottish National party Benches about how horrified they are by these proposals to increase funding for Scotland’s NHS.

"Astonishingly, they seem to oppose the billion pounds of extra funding that Scotland’s NHS will benefit from this year. It is astonishing. I just do not understand how they can possibly explain that to their constituents and justify such an irrational decision."

Labour’s Rachel Reeves said the Conservatives had broken their promises to voters over the plans.

The shadow chancellor said: “There are two tests for the package announced yesterday. The first, does it fix social care? The second, is it funded fairly? The answer to both of those questions is no. It is a broken promise. It is unfair and it is a tax on jobs.”

“At the general election less than two years ago the Prime Minister said to voters ‘Read my lips, we will not be raising taxes on income, on VAT, or national insurance ‘, the Chancellor the Exchequer – I am not sure where he is today – went further and solemnly said ‘Our plan is to cut taxes for the lowest paid through cutting national insurance.'”

She added: “They have broken their legally binding promise on international development, they are breaking it again on the triple lock and the country is now littered by Tory broken promises torn from the election manifesto of all the members opposite.”

Several Tory back benchers confirmed they would either abstain or oppose the plans.

It comes after reports of disquiet among the cabinet about the measures prior to their public unveiling on Tuesday.

Jake Berry, who chairs the Northern Research Group of Tory MPs, said the tax will “never go down, it can only go up” and he would oppose it.

He explained: “It is fundamentally un-Conservative and in the long term it will massively damage the prospects of our party because we will never outbid the Labour Party in the arms race of an NHS tax and that’s why I don’t think this is the right way to do it.”

Fellow conservative Dehenna Davidson MP said she would be abstaining as she did not think enough scrutiny had been done.

She said: “She said: “My main concern is about the fact we haven’t had a great deal of time to consider these proposals, and to consider alternatives as well.”