National Insurance contributions

36.21To the extent that they are payable into the National Insurance Fund (see para 35.9 ), contributions paid by earners, employers and others under the provisions of social security legislation are not regarded as charges upon the people or as subject to the rules of financial procedure. An increase in the rate of contributions, therefore, does not by itself require authorisation by a Ways and Means resolution. However, an amount known as the National Health Service allocation is deducted from National Insurance contributions and retained by the Secretary of State before the residue of the contributions is paid into the National Insurance Fund.1 A Ways and Means resolution is accordingly required to authorise any increase in the proportion of contributions to be deducted by way of National Health Service allocation, even though that allocation does not pass through the Consolidated Fund.2

When a National Insurance surcharge was introduced, payable directly into the Consolidated Fund, the bill imposing it was founded upon a Ways and Means resolution.3 A bill to increase National Insurance contributions and to apply the increases towards the cost of the National Health Service was likewise founded upon a Ways and Means resolution.4