Meeting of the Parliament (Hybrid) 03 February 2022
I acknowledge that this is a very serious issue for many families who see their household bills going in only one direction, at the same time as they try to cope with all the other challenges of the pandemic, which is far from over. Today, that anxiety has been heightened with the news of the increase in the energy price cap.
I also acknowledge concerns about the national insurance rise, which I will come back to in a minute. In addition, I acknowledge anxieties about world markets and increasing political tensions between Russia and the Ukraine, which have potentially serious implications for energy costs and supply chains.
When we drill down into the detail of the inflation statistics, it is clear that producers and suppliers that are involved in international trade are telling us that much of the current level of inflation is a direct result of rising shipping and wholesale gas costs. Those involved in UK business tell us that it is also a result of shortages in labour markets. There are inflation issues in other countries: in Germany, inflation is up to 4.9 per cent; in America, it is up to 7 per cent; in France, it is up to 3.3 per cent; and there is underlying energy inflation in the eurozone, which is now averaging out at 28 per cent.
We know that the cost of the pandemic is well over £400 billion. We know that 6 million people are on NHS waiting lists and, whether we like it or not, we need to go ahead with the national insurance increase to pay directly into health and social care budgets. It is never popular to raise tax and I am not going to argue that the national insurance increase will not be painful but, when the decision was made some time ago, there was a reluctant acceptance that, in order to deal with the waiting lists and NHS crisis, that rise was necessary.