Hunt says plan to scrap employee national insurance could ‘take more than a decade’

Chancellor Jeremy Hunt has acknowledged that his plan to eliminate employee national insurance contributions may take over a decade to implement, hinging on substantial economic growth to avoid cuts in public services or increased borrowing.

Facing questions from the Commons Treasury committee, Hunt emphasized that the initiative would not be realized within a single parliamentary term but remained a long-term goal.

Last week's budget revelation, which forms a key part of the Conservative party's upcoming election manifesto, has sparked caution from economists and the Labour party.

They have expressed concerns that abruptly removing the national insurance charge could significantly strain the budget by over £40 billion, potentially leading to tax hikes, service cuts, or higher borrowing if not managed correctly.

Hunt compared the ambition to past Conservative increases in the tax-free allowance executed over 12 years, while refusing to set a timeline for the insurance cut. He insisted that the plan would not resort to borrowing or reduce public services funding.

Amid critiques from Labour, suggesting the Conservatives haven't learned from past financial missteps, Hunt defended the proposal and challenged Labour to clarify their financial strategies, mentioning Labour's prior support for national insurance cuts.

While admitting the long-term nature of his proposal, Hunt dodged inquiries regarding blending national insurance with income tax—an idea that could imply income tax hikes. He reaffirmed the Tories' commitment to their goal, dependent on economic growth.