23 March 2022

National Insurance increases as planned, but the threshold rise will help most vulnerable

5 min read

Reacting to the Chancellor's Spring Statement Royal London's director of policy and external affairs, Jamie Jenkins, said:

"The Chancellor undoubtedly faced some difficult decisions as he delivered his Spring Statement. Few would argue with the view that improving growth in the economy and reducing taxes should lead to better living standards over the long term, but it’s a fine balance when people are facing such a dramatic cost of living rise in the short term. 

“There were strong calls to defer or cancel the National Insurance increase, but the Chancellor has focused instead on reducing the impact for those on the lowest incomes by significantly increasing the level of the earnings threshold at which it applies. Other announcements included a 5p per litre cut in fuel duty, removal of VAT for those upgrading homes to renewable energy and some further funding to help the poorest households with the impact of rising inflation.

“Whether this proves to be enough will largely depend on whether inflation continues to rise, and to what extent. Many households will be faced with stark choices if high costs persist – or worsen – as we approach next winter.”

About Royal London

Royal London is the largest mutual life insurance, pensions and investment company in the UK, with assets under management of £150 billion, 8.8 million policies in force and 4,262 employees. Figures quoted are as at 30 June 2022. Learn more at royallondon.com

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