£26 billion national insurance ‘grab’ could dent police front line, warns MP

A £26 billion national insurance “grab” could dent police forces’ front lines, a Conservative former minister has warned.

Esther McVey accused the Government of “financial illiteracy”, ahead of a change to employers’ national insurance contribution rates.

Policing minister Dame Diana Johnson promised that “no force” will be “left out of pocket”.

Organisations pay a rate of 13.8% on employees’ earnings above a £9,100-a-year threshold.

Chancellor Rachel Reeves announced last year that a new rate of 15% will come in from April, with the threshold reduced to £5,000.

Ms McVey told MPs in Westminster Hall that the move would cost Cheshire Police in her Tatton constituency £3.7 million per year, based on freedom of information requests which her office sent.

She said the bill in Greater Manchester rises to £11.9 million.

The MP said: “This Government is fiscally illiterate.

“It made a £25 billion grab in employers’ national insurance contributions at the budget, not really thinking where it would come from.”

John Slinger, the Labour MP for Rugby, had earlier intervened in Ms McVey’s speech and said: “She’s making a very entertaining speech, as is often the case, but I would in the midst of all these words about tax, I would merely point out that after her party’s two unfunded national insurance tax cuts, after a £22 billion black hole based upon unfunded spending pledges and kicking the can down the road, what is (Ms McVey’s) suggestion for how to fill that devastating black hole?”

The Conservative MP replied that her party would not have spent money on the Government’s flagship Great British Energy renewables company, adding: “Foreign aid we would not have increased and I’ll tell you one thing we would not have done, collapsed to the rail unions, collapsed to them, find money for those railway workers without modernisation whatsoever.”

Ms McVey continued: “There is a real risk that we will have to, or the police forces will have to, scale back on recruitment, not entertaining.

“This is a real impact that these police forces will have to cut back on vital training, not entertaining, or reduce operational spending in other areas of the police force, again, not entertaining.”

Conservative former minister Wendy Morton also intervened, asking: “If you keep squeezing and squeezing, that money has to come from somewhere, so does that mean reduced public services, fewer, in this case, police officers, or is the burden going to come back on the taxpayer?”

Ms McVey said: “The burden could well come back onto the taxpayer, but remember, it is tax, it is money that will be going on tax, a bill put on by the Government.

“It means, however you look at it, it has deprived from the front line.”

Conservative shadow policing minister Matt Vickers warned budget pressures could see 1,800 fewer officers patrolling the streets in England and Wales.

He pointed to the police inspectorate’s decision to rate Cleveland Police in his Stockton West constituency as “inadequate” for investigating child abuse, neglect, and exploitation.

“These children deserve better,” Mr Vickers said.

“Does the minister agree that creating a shortfall in funding for a force could lead to more failures in responding to and investigating child abuse, neglect, and exploitation in Cleveland?”

Dame Diana said: “We are providing compensation of £230.3 million to support forces with the cost of changes to national insurance and ensure that no force is left out of pocket as a result.”

She added: “We are compensating for the national insurance increases to ensure forces have the resources they need to protect visible neighbourhood policing.

“Our position could not be clearer, we will work in lockstep with the law enforcement system, in our shared effort to keep people safe.”

According to Government figures, changes to national insurance will raise £25.7 billion by 2030.