“It is excellent that we will be reversing one of Labour’s tax rises and reducing the National Insurance tax on jobs which both employers and employees have to pay. This will give people real confidence that we can deliver on what we say we and rely primarily on spending cuts and not extra taxes to close the deficit.
Well done George, and congratulations on your excellent and reassuring contribution to the debate against Darling and Cable last night.”
Stopping the planned increases in National Insurance Contributions will result in 7 out of 10 working people being better off.
A Conservative Government will take immediate action to start cutting Government waste, in order to spend £6 billion less in 2010-11 than Labour’s plans.
“The re-election of a Labour Government under Gordon Brown – with more debt, waste and taxes – will bring us a new recession”, George Osborne said, speaking alongside Ken Clarke and Phillip Hammond.
“Labour will kill the recovery with their tax on jobs. We will cut Labour waste to stop it.”
Former Government advisers Sir Peter Gershon and Dr Martin Read, now members of the Conservatives’ Public Sector Productivity Advisory Board, advise that savings of £12 billion across all departmental spending are possible in-year without affecting the quality of front line services.
Having identified these savings the Conservatives can now commit to stop Labour’s tax rise on working people and jobs at the same time as reducing the deficit faster:
Labour are planning to raise Employees National Insurance Contributions (NICs) for everyone earning over £20,000. We will stop this increase altogether for everyone earning under £35,000 by raising the primary threshold at which people start paying NICs by £24 a week, and raising the Upper Earnings Limit by £29 a week.
Relative to Labour’s plans everyone liable for Employees NICs earning between £7,100 and £45,400 – which is 7 out of 10 working people – will be up to £150 better off a year under the Conservatives. Lower earners will get the greatest benefit as a percentage of their earnings. Nobody will be worse off.
Labour are also planning to raise Employers NICs for everyone earning over £5,700. This is a tax on jobs that will undermine the recovery. We will raise the secondary threshold at which employers start paying NICs by £21 a week, saving employers up to £150 for every person they employ relative to Labour’s plans. This will reduce the cost of Labour’s tax rise on employers by more than half.