Ministers resist Jacob Rees-Mogg's call to scrap National Insurance hike

Ministers were resisting calls to scrap the National Insurance hike to protect struggling households after Commons Leader Jacob Rees-Mogg argued to the Cabinet the rise should be shelved.

Jacob Rees-Mogg has reportedly called for the National Insurance rise to be cancelled.
Jacob Rees-Mogg has reportedly called for the National Insurance rise to be cancelled.

Transport Secretary Grant Shapps insisted on Thursday the decision has been made collectively as there is a “very good case” for the 1.25 percentage point increase to support the backlog in the NHS from coronavirus and overhaul social care.

A significant number of Tory MPs oppose the hike being imposed in April, as does Labour, and Lord Frost resigned from the Cabinet citing high taxation as one of his major concerns.

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It was understood Mr Rees-Mogg told Chancellor Rishi Sunak at Wednesday’s Cabinet meeting that the increase should be scrapped to stem the cost of living crisis engulfing the Government as inflation and energy bills rise.

Mr Shapps declined to comment on the specifics of discussions in Cabinet but told BBC Radio 4’s Today programme: “We’ve made our decisions. We have a collective responsibility.

“There’s a very, very good case, I think everybody will agree, for both catching up with the backlog coronavirus has created in NHS operations and procedures and for solving a historic, rather unforgivable situation where if you happen to come down with certain types of illnesses, particularly things like dementia, you can end up losing your home because social care doesn’t look after you.

“We made the decision as a Government to look after those things and we set out how we’ll do it, which is a National Insurance increase.”

Labour also increased the pressure on the Government during Prime Minister’s questions on Wednesday, with deputy leader Angela Rayner accusing Boris Johnson and the Chancellor of having “presided over economic mismanagement, low growth and neglect of our public services”.

“And their resolution to fix this? Whacking more taxes on working people,” she said.

“Combine the tax rise with soaring energy prices and the average family faces a hit of £1,200 – this is an iceberg right ahead, so will he finally stop and change course… or will he plough on to what will be a disaster for thousands of families?”

The head of the Resolution Foundation think tank said last month that families would face a £1,200 hit by April “from soaring energy bills and tax rises”.

Chief executive Torsten Bell said: “So large is this overnight cost-of-living catastrophe that it’s hard to see how the Government avoids stepping in.”

But Downing Street suggested on Wednesday that there are no imminent plans to help keep energy prices down for customers.

The Prime Minister’s official spokesman said: “I’m not aware of any further changes at the moment, but obviously we keep it under review, we are listening to those most affected.”

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