Chancellor Rishi Sunak has argued it would be irresponsible to “duck difficult decisions” after Commons Leader Jacob Rees-Mogg called for the national insurance hike to be scrapped to relieve pressure on households struggling with the soaring cost of living.
Amid a Cabinet rift, Mr Sunak said on Thursday he understands “people’s anxiety and concern about rising prices and inflation” but defended the increase of 1.25 percentage points as necessary to tackle the backlog in the NHS from coronavirus.
It was understood Mr Rees-Mogg told the Chancellor during Wednesday’s Cabinet meeting that the increase should be scrapped to stem the cost-of-living crisis as inflation and energy bills rise.
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.
Speaking during a visit to a vaccination centre in Haywards Heath, West Sussex, Mr Sunak told broadcasters: “I have enormous respect for all my colleagues and if you take a step back and look back at why we’re in this situation, it’s because we’re facing an unprecedented level of backlogs in the NHS and we as a Government don’t think it’s acceptable, we don’t want families to be waiting years and years to get the treatment they need.
“It’s always easy to duck difficult decisions but I don’t think that’s the responsible thing to do.”
Boris Johnson used the strain being placed on hospitals due to the massive wave of Omicron cases to argue the case for the raise, which he calls the Health and Social Care Levy.
Speaking to broadcasters during a visit to a vaccination centre in Moulton Park, Northampton, the Prime Minister said it is important to maintain increased support for hospitals as the NHS faces “very difficult circumstances”.
“That’s why we’ve invested massively through the Health and Social Care Levy – that’s very, very important for the NHS to clear these backlogs, enable them to deal with Covid right now and to catch up,” he added.
The Prime Minister’s official spokesman suggested the hike would not be scrapped.
“There are no plans to do that, no,” he told journalists.
“The Cabinet collectively agree with that approach and recognise the priority of the public in ensuring our NHS has the funding it needs to tackle the backlog, which has been exacerbated by Covid.”
Transport Secretary Grant Shapps said the decision has already been made collectively as there is a “very good case” to combat the backlog in the NHS and overhaul social care.
Mr Shapps declined to comment on the specifics of discussions in Cabinet but argued that the decision had already been done and dusted.
“We’ve made our decisions. We have a collective responsibility,” he told BBC Radio 4’s Today programme.
“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.”
Mr Rees-Mogg did not deny calling for the increase to be scrapped when appearing in the Commons for business questions.
Shadow Commons leader Thangam Debbonaire had asked him: “Perhaps he turns out to be more socialist than he has hitherto let on. Given that, according to the Financial Times, he is now asking his own Government to scrap the national insurance tax rise, something we have been calling for since it was announced…
“I wonder – is he about to cross the floor? There is space.”
Mr Rees-Mogg replied: “She thinks that I may be converted to her way of thinking. I think this is wishful thinking, it has to be said, because as her question went on and on it became clearer and clearer that not only is she now referring to taxpayers’ money – a good Tory principle, we always call it taxpayers’ money because we recognise there is no money from anywhere else – but also she is becoming Eurosceptic.
“She has become a staunch Brexiteer because the only way our socialist friends can advocate cutting VAT on fuel is by having left the European Union. If we were still in the megalithic state that she used to so campaign for… we would not be able to cut VAT on fuel.”
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.”