Chancellor Rachel Reeves was left agitated when questioned by Laura Kuenssberg on the first Labour Budget this week.
Rachel Reeves clashes with Laura Kuenssberg on Employer Nation Insurance (Image: BBC)
Rachel Reeves was left clearly agitated when questioned by Laura Kuenssberg on the first Labour Budget in a fiery television clash this morning.
Pressing on the rise in National Insurance (NI) for employers, the BBC presenter quizzed the Chancellor on whether she would rethink this move.
Ms Reeves responded “I’m not immune to their criticism… but we’ve got to raise the money to put our public finances on a firm footing.”
From next April, the rise of 1.2% means employers will have to pay NI at 15% on salaries above £5,000, instead of 13.8% on salaries above £9,100 currently.
“Some of our viewers aren’t just upset about the decision you have made on National Insurance, they’re upset about the way you went about it,” expressed Kuenssberg.
The host went on to play a previous clip of the Chancellor and what she had said on NI back in May when questioned by the BBC.
READ MORE: Rachel Reeves shamelessly admits she was wrong to promise no Labour tax hikes
Rachel Reeves quizzed by Laura Kuenssberg on National Insurance
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Ms Reeves clearly stated in the clip from six months ago that she will “certainly not be increasing Income Tax or National Insurance if we win the election”.
However, the Chancellor quickly came to her own defence off the back of this video, saying: “In our manifesto we were clear. We said we would not increase key taxes that working people pay.”
Kuenssberg interrupted by snapping back: “I’m sorry Chancellor but on this point, our viewers, some of them feel very strongly that they were misled on this.
“There was a caveat in your manifesto, some lines down…”
Ms Reeves squirmed in her chair as she is quick to interject this point.
She replied: “No, no, before, it was before the commitment in the manifesto.”
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The Chancellor swiftly moved on from her claim to say: “I’m not immune to the concerns that people have around the increase in Employer National Insurance.”
NI will be hiked up by 1.2 percantage points from April 2025.
The Treasury also announced a reduction in the secondary threshold, the level at which employers start paying NI, from £9,100 per year to £5,000 – a whopping 45% reduction.
Despite Ms Reeves claiming that she has left alone the ‘working people’ from tax hikes, millions of hardworking individuals will be indirectly affected by the budget.
Forecasts released by The Office for Budget Responsibility predict that real household disposable income is now set to be £300 lower following the budget, leaving the many ‘working people’ poorer by 2030.
