Queen's Speech: Employers' NICs to be frozen for five years

The government will introduce new business and benefits reforms focusing on employer taxation and a doubling of free childcare as part of the Queen’s Speech.

The Speech contained 26 bills including reforms to trade union laws as expected and the potential for employers to perform background check on whether an employee is considered an extremist.

However, it did not include any reference to the volunteering election pledge or reform of the Human Rights Act which would impact workplace discrimination.

Employers will benefit from legislation blocking tax rises which will include class one employer and employee national insurance contributions for the length of the parliament.

The government also aims to save business at least £10bn over the parliament by cutting red tape as part of its new Enterprise Bill.

An increase to free childcare was a key pledge in the Conservative manifesto. Under the proposed reforms, access to free childcare for three to four-year-olds is set to double to 30 hours a week.

Prime Minister David Cameron said that the £350m-a-year cost would be funded through reductions in tax relief on pension contributions.

Currently, all three and four-year-olds in England are entitled to 570 hours a year of free early education or childcare at nurseries, play and pre-school groups, Sure Start children's centres, or with childminders. This works out as 15 hours each week for 38 weeks of the year.

Employment checks enabling employers to check whether an individual is an extremist and bar them from working with children will be proposed as part of the Extremism Bill.

The government also announced it will freeze the main rates of the majority of working-age benefits, tax credits and child benefit as part of the Full Employment and Welfare Benefits Bill.

Under the bill, the level of the benefit cap will be reduced from £26,000 to £23,000.

Personal allowance will be increased to £12,500 to ensure people working 30 hours a week on the National Minimum wage do not pay income tax.

Posted: Mon 28 May 2018
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