Lord Warner – 2015 Parliamentary Question to the HM Treasury

The below Parliamentary question was asked by Lord Warner on 2015-11-11.

To ask Her Majesty’s Government what estimate they have made of the additional national insurance contributions that will be made in the first year of the introduction of the National Living Wage; and what assessment they have made of whether that source of revenue could be used to fund the extra cost of publicly-funded social care.

Lord O’Neill of Gatley

As set out in Table B.3 in of their July 2015 Economic and Fiscal Outlook, the Office for Budgetary Responsibility estimate that, by 2020-21, the National Living Wage will increase income tax and NICs receipts by around £0.1bn. They assume that, by 2020-21, the overall impact of the policy on the public finances is to reduce public sector net borrowing by £0.2bn.

The Chancellor will set out full plans for public expenditure at the Spending Review on 25th November.