TGLP is continuing to lead calls for the Government to reverse its decision to exclude London and the South East from a National Insurance holiday for new businesses, which will benefit firms across the rest of the UK, but not in the Thames Gateway.

TGLP provided a written submission to the Bill Committee, which met over a series of sessions in the first weeks of December and to discuss potential amendments.

As the Bill stands, new businesses will not have to pay the first £5,000 of Class 1 employer National Insurance contributions due in the first twelve months of employment for each of the first ten employees hired in their first year of business.  However, TGLP is asking Government to reconsider the exclusion of London and the South East from the ‘holiday’, and is concerned that it demonstrates a failure to understand the diversity of London and the South East’s economy.

Proposed amendments that would have seen the rules regarding regional exclusion changed were defeated at this stage, but Thames Gateway MPs pressed the Government representatives hard on the impact of excluding London and South East boroughs from the measure, and remain hopeful that a new approach to the targeting of the National Insurance ‘holiday’ will be considered.

Shadow Treasury Minister David Hanson MP, used the TGLP briefing to make the case for the proposed changes during the committees consideration of the Bill.

He told the committee:

“At a time of massive public spending cuts, very difficult challenges and real issues of regional development ahead of us. If those regions are excluded from the payment holiday, there is no opportunity for those deprived boroughs to access that scheme.

However, do not just listen to me—as ever, I am a bigoted Labour politician, I have my views, stood for election and opposed the Government, and this is me, speaking as a Labour politician. I have stretched the hand of friendship out to the Minister and said that we support the Bill, but do not just listen to me; look at the evidence that has been presented to the Committee. As paragraph 1 of the written evidence from the Thames Gateway London Partnership states:

“The Thames Gateway London Partnership (TGLP) believes that the National Insurance contributions holiday should be extended to cover London and the South East.”

It is the first thing that the TGLP said, and the evidence continues with this damning statement, which is the important part:

“A failure to do so demonstrates a lack of understanding about the diversity of the London Thames Gateway’s economy and the importance of the London Thames Gateway as the driver for the UK economy. The exclusion of London and the South East from the Bill is inconsistent with the intention”.

To read the full text of the Bill Committee session, click here (David Hanson’s contribution is on page 68).

The Evening Standard covered TGLP’s efforts to have the National Insurance holiday measures expanded to include the whole of the UK.  Click here to see the article on the Evening Standard website.