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At a time when both the economy and household budgets are slowly recovering from a pandemic which is not yet over, the UK Tory Government is contemplating increasing national insurance (NI) contributions.

The move will disproportionately hit lower and middle-income earners, a large proportion of whom have already been affected by a decade of Tory austerity, Brexit and COVID-19.

As Boris Johnson himself said in 2002, in the House of Commons while a young MP when Labour proposed such a hike: “increases are regressive and someone earning £32,000 will pay exactly the same as someone earning £132,000.”

Now he is Prime Minister, Mr Johnson appears to have forgotten that fact.

NI is paid by employees who are below state pension age on earnings of £9,568 per year or above, whereas income tax is paid on earnings of £12,570 or more. NI is also paid by employers and so is, in effect, a “jobs tax,” and rises dissuade them from taking on new workers. This is hardly the message to send out as furlough ends and unemployment threatens many.

As NI is paid for the time an individual is employed, rather than over a full year like income tax, it impacts young, part-time and zero-contract employees disproportionately. These workers also tend to be lower-paid and younger. Middle-income earners will also have to pay more.

Clearly, the Chancellor of the Exchequer is in some difficulty. The pandemic has understandably led to huge public borrowing to keep the economy alive at this difficult time.

Needless to say, the Tories’ incompetent handling of the economy did not help. Through Brexit and constant dithering over COVID-19 and economic mismanagment, the UK economy has shrunk by 6.1% compared to a year ago, as illustrated in this week’s Economist.

To put that in perspective, the collective economy of the 27-member European Union shrank by 1.3%, whereas economies ranging from the United States to Australia to China actually grew. Embarrassingly for Tory claims of economic competence, the UK economy had the fastest decline amongst the world’s 42 largest economies. And we all have to pay the price!

A clear strategy is needed if the economy is to recover.

Whilst VAT, NI, interest rates and fuel, alcohol and tobacco duties etc remain under UK control, the SNP Government is determined to do all it can to revive Scotland’s economy with the powers it has.

The Advisory Council on Economic Transformation, chaired by Economy Secretary Kate Forbes MSP, met for the first time on 22 July. These experts will help shape an ambitious 10-year national strategy that prioritises investment in the industries of the future and delivers new, green jobs.

Entrepreneurs, business people, trade unions and economists will work together to deliver a focused plan of actions and projects that will help transform our economy.

Citizens are encouraged to share their views on how best Scotland can work together to rebuild our economy. Suggestions should be emailed to: by 27 August.

Further information is at:


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