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National Insurance Contributions Bill

I do not think that the argument for abolishing the ratio has been made; at least, it has not been advanced not terribly persuasively. I shall come in a moment to the detail of our amendments, in which we have attempted to outline alternative ways to address that concern. I am not saying that I am necessarily wedded to the idea of a ratio, but that is how Parliament's position has been protected for the past 33 years, and it may be the best way to protect it in future. We can examine other ways. My hon. Friend will recall that we considered the ratio argument in Committee. I understand that the Government are trying to align national insurance contribution rates and bands with those for income tax. Although I am concerned that their way of doing it is motivated principally by the aim of raising revenue, the objective of aligning the two is a perfectly respectable and honourable one to which we have no particular objection. It is fair to say that publications such as the Forsyth report were instrumental in encouraging the Government to go down that route or at least to place greater emphasis on simplification. We do not have any problem with that, so we are keen to be helpful to the Government, notwithstanding our concerns about the revenue-raising element. We are willing to help the Government achieve their objective while providing some protection for Parliament; that is the basis of the amendments that we have tabled in Committee and today. Various calculations were done on widening the bands. For the first time in some while, I got out my calculator and tried to work out what ratio would be needed, given that the upper point is seven and a half times what is now the primary threshold. It is a difficult sum to calculate in some respects, because one must look at future years and so on, but it is clear that if the existing ratio is breached, it will be breached by only a relatively small amount. One idea, which I think the hon. Member for Taunton (Mr. Browne) proposed, was that the primary threshold could always be increased a little if the ratio would be breached only by a small margin. One of our proposals in Committee was to widen the bands, as my hon. Friend the Member for Cities of London and Westminster (Mr. Field) mentioned, so that eight would be the top point rather than seven and a half. Quite possibly Treasury officials have done the calculations—if so, I should be interested to hear what the Minister says about it—but I do not think that there is any doubt that a ratio of eight times the primary threshold as the maximum point would cause the Government any difficulties in achieving their stated objective. One approach would be to consider that ratio. We debated and voted on that proposal in Committee, so it could not be brought back on Report, but it is an idea to which we are sympathetic.