22 September 2021
Andrew Mitchell MP calls for greater scrutiny and accountability over new Health and Social Care Levy

Following the Government’s announcement on social care and NHS funding, Andrew Mitchell MP spoke in a debate in the House of Commons about the new health and social care levy.

The Prime Minister recently announced tax changes to help better fund the NHS and social care across the UK. National Insurance contributions (NICs) will increase by 1.25% for one year for employees, employers and the self-employed from April 2022. This will cover both Class 1 (employee and employer), Class 1A and 1B and Class 4 (self-employed) NICs. Those above State Pension Age are not impacted by the April 2022 changes. From April 2023, a new ringfenced Health and Social Care Levy of 1.25% will be introduced which will apply to those who pay Class 1 (employee and employer), Class 1A and 1B and Class 4 (self-employed) NICs. When the new levy comes into effect, National Insurance rates will revert back to current levels.

The new levy will also apply to individuals above State Pension age with employment income or profits from self-employment above £9,568. The levy will be administered by HMRC and collected through the current reporting and collection procedures for NICs – Pay As You Earn and Income Tax Self Assessment. As with National Insurance, levy contributions will apply across all four nations of the UK. From 2023-24, levy contributions will appear as a separate item on payslips. The Government will also increase by 1.25% from April 2022 the rate of income tax which is paid by people who receive dividend income from shares.

Andrew Mitchell said:

“Our new £36 billion funding package will help to tackle NHS backlogs - providing an extra 9 million checks, scans, and operations, and increasing NHS capacity to 110 per cent of its pre-pandemic levels by 2023-24 – whilst reforming adult social care by introducing a lifetime cost cap of £86,000, covering care costs for anyone with assets under £20,000, and increasing the threshold above which state support stops to £100,000.

“It is vital that we ensure that taxpayers know exactly how the additional revenue is being spent to improve the NHS and social care. During the debate on the levy, I asked the Treasury to update the House of Commons every six months on exactly how the money is being spent. In addition, I have tabled two written parliamentary questions to the Department of Health and Social Care, asking the Secretary of State to publish on a six-monthly basis the value for money calculations made on the additional health and social care expenditure and the additional results achieved by the NHS as a result of the levy.”