137-632: National Insurance ( NI ) is a fundamental component of the welfare state in the United Kingdom . It acts as a form of social security , since payment of NI contributions establishes entitlement to certain state benefits for workers and their families. Introduced by the National Insurance Act 1911 and expanded by the Labour government in 1948, the system has been subjected to numerous amendments in succeeding years. Initially, it
274-822: A "unified medical service" can be dated back to the Minority Report of the Royal Commission on the Poor Law in 1909. Somerville Hastings , President of the Socialist Medical Association , successfully proposed a resolution at the 1934 Labour Party Conference that the party should be committed to the establishment of a State Health Service. Following the 1942 Beveridge Report 's recommendation to create "comprehensive health and rehabilitation services for prevention and cure of disease", cross-party consensus emerged on introducing
411-719: A 13% increase from the previous year. In 2018 support for raising taxes to finance more provision on health, education and social benefits was the highest it had been since 2002 according to NatCen Social Research . Two-thirds of Labour supporters favoured tax rises and 53% of Conservatives also favoured that. In 2018 the House of Commons library estimated that by 2021, £37bn less would be spent on working-age social security than in 2010. Cuts to disability benefits , Personal Independence Payments (PIP) and employment and support allowance (ESA) are noteworthy, they will have fallen by 10%, since 2010. Over half of families with income below
548-542: A 3.4% increase in funding every year to 2024, which would allow it to receive an extra £20bn a year in real terms funding. [dead link] There is concern that a high proportion of this money will go to service NHS debts rather than for improved patient care. In June 2018, it was reported that there were calls for the government to write off the NHS debt. Saffron Cordery of NHS Providers said that hospitals needed help to do their work without being up in deficit, as two-thirds were in
685-512: A National Health Service of some description. Conservative MP and Health Minister, Henry Willink later advanced this notion of a National Health Service in 1944 with his consultative White Paper "A National Health Service" which was circulated in full and short versions to colleagues, as well as in newsreel. When Clement Attlee 's Labour Party won the 1945 election he appointed Aneurin Bevan as Health Minister . Bevan then embarked upon what
822-431: A comprehensive range of health services , provided without charge for residents of the United Kingdom apart from dental treatment and optical care. In England , NHS patients have to pay prescription charges ; some, such as those aged over 60, or those on certain state benefits, are exempt. Taken together, the four services in 2015–16 employed around 1.6 million people with a combined budget of £136.7 billion. In 2024,
959-611: A contributions record while not working, or to those applying for benefits whose contribution record is only slightly short of the requirements for those benefits. In the latter case, they cannot be used to fill "gaps" in past years in contribution records for some benefits. The benefit component comprises a number of contributory benefits of availability and amount determined by the claimant's contribution record and circumstances. Weekly income benefits and some lump-sum benefits to participants upon death, retirement, unemployment, maternity and disability are provided. Benefits for which there
1096-567: A lack of beds in the NHS and a lack of personal protective equipment (PPE). In the closing statement of the British Medical Association (BMA) in July 2023, it was noted that this lack of pandemic preparedness manifested in four key areas; failure to protect healthcare workers, lack of capacity and resources, failings of the test and trace system, and failings in government structures and processes. The statement also claimed that
1233-612: A lot of coverage in the media. The Welsh and UK governments announced a partnership on 23 September 2024 to reduce NHS waiting lists in England and Wales during the Labour Party Conference in Liverpool. This collaboration aimed to share best practices and tackle common challenges. Previously, Eluned Morgan rejected a Conservative proposal for treating Welsh patients in England. The Welsh Conservatives welcomed
1370-499: A percentage of net profits above a threshold, which is reviewed periodically. Individuals may also make voluntary contributions to fill a gap in their contributions record and thus protect their entitlement to benefits. Contributions are collected by HM Revenue and Customs (HMRC). For employees, this is done through the PAYE (Pay As You Earn) system along with Income Tax , repayments of Student Loans and any Apprenticeship Levy which
1507-405: A periodic basis, usually weekly or monthly depending on how the employee is paid, with no reference to earnings in previous periods. Those for company directors are calculated on an annual basis, to ensure that the correct level of NICs are collected regardless of how often the director chooses to be paid. There are a number of milestone figures which determine the rate of NICs to be paid. These are
SECTION 10
#17327660520261644-460: A qualifying contribution record for contributions-based Jobseekers Allowance , but do count towards Employment and Support Allowance . Class 3 contributions are voluntary NICs paid by people wishing to fill a gap in their contributions record which has arisen either by not working or by their earnings being too low. Class 3 contributions only count towards State Pension and Bereavement Benefit entitlement. The main reason for paying Class 3 NICs
1781-408: A result and unlike Income Tax , a weekly paid employee will face a charge in any week where earnings exceed 1/52 of the annual limit. It is therefore possible for a charge to arise on someone who earns below the limit on an annual basis but who has occasional payments above the weekly limit. A further complication is that an employee has an allowance per employer, unlike income tax where the allowance
1918-630: A widening of what was considered to be the state's responsibility. In addition to the central services of education, health, unemployment and sickness allowances, the welfare state also included the idea of increasing redistributive taxation, and increasing regulation of industry, food, and housing (better safety regulations, weights and measures controls, etc.) The foundation of the National Health Service (NHS) did not involve building new hospitals, but nationalisation of existing municipal provision and charitable foundations. The aim
2055-440: A year. If a self-employed worker earns £8,632 or more a year they will be categorised as Class 4. Class 2 contributions are charged at £3.00 per week and are usually paid by direct debit. While the amount is calculated to a weekly figure, they were typically paid monthly or quarterly until 2015. For future years, class 2 is collected as part of the tax self-assessment process. For the most part, unlike Class 1, they do not form part of
2192-493: Is a contribution condition: Historic benefits for which there was a contribution condition: To administer the National Insurance system, a National Insurance number is allocated to every child shortly after their birth when a claim to Child Benefit is made. People coming from overseas have to apply for a NI number before they can qualify for benefits; although holding a NI number is not a prerequisite for working in
2329-514: Is currently set at the figure at which the higher rate of Income Tax becomes chargeable for a person on the standard personal allowance for Income Tax in all parts of the UK except Scotland (which can set its own level for the tax threshold, but not for the NI upper limit). The 2019-24 government 's manifesto in the 2019 general election promised to restore the parity between the NI and Income Tax thresholds by
2466-404: Is expected that government health spending, which is the biggest element of public spending, will reach £176,200,000,000. Other welfare expenses include education, which is predicted to reached £81,400,000,000, and state pensions, for which expenditure will be £124,300,000,000. In the grammar of British social attitudes, an entitlement is something I get, a benefit is something you get, a handout
2603-469: Is often locally referred to as "the NHS". The original three systems were established in 1948 (NHS Wales /GIG Cymru was founded in 1969) as part of major social reforms following the Second World War . The founding principles were that services should be comprehensive, universal and free at the point of delivery—a health service based on clinical need, not ability to pay. Each service provides
2740-402: Is perpetuating welfare spending, and claim that a cultural change is required to reduce the welfare bill. Public opinion in the UK appears to support a reduction in welfare spending, however commentators have suggested that negative public perceptions are founded on exaggerated assumptions about the proportion of spending on unemployment benefit and the level of benefit fraud . Figures from
2877-545: Is regardless of whether they derive a salary or wage from the organisation, or receive any type of funding or assistance from the organisation for the purposes of working overseas. This is in recognition of the fact that most missionaries would be unable to afford private health care and those working in developing countries should not effectively be penalised for their contribution to development and other work. Those who are not ordinarily resident (including British citizens who may have paid National Insurance contributions in
SECTION 20
#17327660520263014-420: Is something they get, and taxpayers’ hard-earned money is something asylum seekers get. Stephen Daisley Conservative thinkers have debated the structural incompatibility between liberal principles and welfare state principles. Certain sectors of society have argued that the welfare state creates a disincentive for working and investment. Also suggesting that the welfare state at times does not eliminate
3151-479: Is split between employers via the person's tax code. So a person with two low paid jobs would pay less, possibly nothing, than someone who earned the same amount from one job. In addition, no deductions are allowable unlike with Income Tax. This means that NI becomes payable on a greater share of income (immediately after the threshold). Welfare state in the United Kingdom The welfare state of
3288-403: Is to ensure that a person's contribution record is preserved to provide entitlement to these benefits, though care needs to be taken not to pay unnecessarily as it is not necessary to have contributions in every year of a working life in order to qualify. Class 4 contributions are paid by self-employed people as a portion of their profits. The amount due is calculated with income tax at the end of
3425-544: The Department for Work and Pensions (DWP), the UK Government department that runs the welfare state in the UK. These include "increased debt and rent arrears, food poverty, crime and worsening physical and mental health . Statistics indicate that in the period of 2011 to 2015 benefit sanctions on people with mental health problems increased by 668%. 19,259 people with mental health problems had benefits stopped in
3562-469: The Department for Work and Pensions show that benefit fraud is thought to have cost taxpayers £1.2 billion during 2012–13, up 9% on the year before. This was lower than the £1.5 billion of benefit underpayment due to error. In some cases, relatives who bring up a child when the parents cannot bring up the child face sanctions and financial penalties, they can be left poor and homeless. There are also widespread complaints from church groups and others that
3699-509: The English Poor laws ) was subject to widespread abuse and promoted squalor, idleness and criminality in its recipients, compared to those who received private charity. Accordingly, the qualifications for receiving aid were tightened up, forcing many recipients to either turn to private charity or accept employment. Opinions began to be changed late in the century by reports drawn up by men such as Seebohm Rowntree and Charles Booth into
3836-491: The European Health Insurance Card . Those from other countries with which the UK has reciprocal arrangements also qualify for free treatment. Since 6 April 2015, non-EEA nationals who are subject to immigration control must have the immigration status of indefinite leave to remain at the time of treatment and be properly settled, to be considered ordinarily resident. People not ordinarily resident in
3973-583: The Institute for Fiscal Studies had stated a 5% real-terms increase was needed for real change. Paul Johnson of the IFS said the 3.4% was greater than recent increases, but less than the long-term average. In July 2016, health experts said the money would "help stem further decline in the health service, but it's simply not enough to address the fundamental challenges facing the NHS, or fund essential improvements to services that are flagging." In November 2018, it
4110-546: The National Health Services (NHS). However a small percentage is transferred from the funds to the NHS from certain of the smaller sub-classes. Thus the four NHS organisations are partially funded from NI contributions but not from the NI Fund. Less than half of benefit expenditure (42.1%) now goes on contributory benefits, compared with over 65% in 1978–79 because of the growth of means-tested benefits since
4247-486: The Office for Budget Responsibility said that "the rising trend in health and social care spending and pensions will be adding something like another £75 billion spending over the next five years, £150 billion, potentially over the next decade" as if treatments are available to keep people alive longer, then people will want them. In July 2022, The Telegraph reported that the think tank Civitas found that health spending
National Insurance - Misplaced Pages Continue
4384-505: The PAYE system, along with Income Tax and repayments of Student Loans and Postgraduate Loans. People in certain circumstances, such as caring for a child, caring for a severely disabled person for more than 20 hours a week or claiming unemployment or sickness benefits, can gain National Insurance credits which protects their rights to various benefits. National Insurance is a significant contributor to UK government revenues, with contributions estimated to comprise 18% of total revenue in
4521-481: The RPI . As indicated above, the rates at which an individual and their employer pay contributions depend on a number of factors. Consequently, there are many possible sets of employer/employee contribution rates to allow for all combinations of the various factors. HMRC allocate a letter of the alphabet, referred to as an 'NI Table Letter', to each of these sets of contribution rates. Employers are responsible for allocating
4658-465: The Second World War had encouraged the belief that the state might be able to solve problems in wide areas of national life. The Liberal government of 1906–1914 implemented welfare policies concerning three main groups in society: the old, the young and working people. The aftermath of the First World War boosted demands for social reform, and led to a permanent increase in the role of
4795-399: The "UK was bottom of the table on numbers of doctors, nurses, beds, intensive care units, respirators and ventilators", and that funding of healthcare has been inadequate since 2010, suggesting that the state the NHS found itself in at the outbreak of the pandemic had not been an overnight shift, but rather the effect of the past decade's funding issues. The UK has seen a drastic increase in
4932-476: The 'Centre for Health Economics' at the University of York found that between 2004/05 and 2016/17 the productivity of the NHS has increased nearly two and a half times as quickly as the larger economy. Between 2010 and 2017, there was a cap of 1% on pay rises for staff continuing in the same role. Unions representing doctors, dentists, nurses and other health professionals have called on the government to end
5069-467: The 1920s, a new perspective was offered by reformers to emphasise the usefulness of family allowance targeted at low-income families was the alternative to relieving poverty without distorting the labour market. The trade unions and the Labour Party adopted this view. In 1945, family allowances were introduced; minimum wages faded from view. The experience of almost total state control during
5206-426: The 2019/2020 financial year. National insurance contributions (NICs) fall into a number of classes. Class 1, 2 and 3 NICs paid are credited to an individual's NI account, which determines eligibility for certain benefits - including the state pension. Class 1A, 1B and 4 NIC do not count towards benefit entitlements but must still be paid if due. Class 1 contributions are paid by employers and their employees. In law,
5343-516: The EEA coming to the UK for a temporary stay of more than six months are required to pay an immigration health surcharge at the time of visa application, and will then be entitled to NHS treatment on the same basis as a resident. This includes overseas students with a visa to study at a recognised institution for six months or more, but not visitors on a tourist visa. In 2016 the surcharge was £200 per year, with exemptions and reductions in some cases. This
5480-519: The EU average and explains why some believe the welfare state is not so successful. It is also a fact that "The UK dedicates roughly one-fifth of its GDP to social spending. That places us 17th – roughly in the middle – of OECD countries" (Whiteford, 2022). Over the course of the COVID-19 pandemic , it became clear that there was a distinct shortage of provisions available to support public health, including
5617-560: The EU holding a valid European Health Insurance Card and persons from certain other countries with which the UK has reciprocal arrangements concerning health care can get emergency treatment without charge. The NHS is free at the point of use, for general practitioner (GP) and emergency treatment not including admission to hospital, to non-residents. People with the right to medical care in European Economic Area (EEA) nations are also entitled to free treatment by using
National Insurance - Misplaced Pages Continue
5754-451: The GP's health and that of their patients at risk. The Royal College of Physicians surveyed doctors across the UK, with two-thirds maintaining patient safety had deteriorated during the year to 2018: 80% feared they would be unable to provide safe patient care in the coming year while 84% felt that increased pressure on the NHS was demoralising the workforce. In June 2018, at a time when the NHS
5891-564: The Liberal Party, which advocated state intervention as a means of guaranteeing freedom and removing obstacles to it such as poverty and unemployment. The policies of the New Liberalism are now known as social liberalism . The New Liberals included intellectuals like L. T. Hobhouse , and John A. Hobson . They saw individual liberty as something achievable only under favourable social and economic circumstances. In their view,
6028-644: The Lower Earnings Limit (LEL), Primary Threshold (PT), Secondary Threshold (ST) and Upper Earnings Limit (UEL), though often the PT and ST are set to the same value. The cash value of most of these figures normally changes each year, either in line with inflation or by some other amount decided by the Chancellor . The PT is normally indexed to inflation using the CPI , while other thresholds remain indexed using
6165-698: The NHS England published the NHS Long Term Plan . The Guardian reported that data for 2020 suggests a change, and that the doctors' trade union and professional association , the BMA , say this was largely due to raised spending during the pandemic and the effect of Covid on the whole economy, since the GDP of the UK dropped more than that of all other G7 nations. The BMA also said in December 2022 that
6302-400: The NHS experienced "historical underfunding and under-resourcing" during the ten years before COVID. The King's Fund maintains The investment in services started in 2021 was badly needed, but despite it restoring key services and performance standards will require years. Shortages of workers and growing staff numbers experiencing burnout and thinking of leaving the NHS may stop progress. If
6439-446: The NHS has among the lowest numbers of doctors, nurses and hospital beds per capita in the western world. In May 2018, it was said that nurses within the NHS said that patient care was compromised by the shortage of nurses and the lack of experienced nurses with the necessary qualifications. In June 2018 it was reported that the NHS performed below average in preventing deaths from cancer, strokes and heart disease. In September 2018 it
6576-738: The NHS. The NHS is the largest employer in Europe, with one in every 25 adults in England working for the NHS. As of February 2023, NHS England employed 1.4 million staff. Nursing staff accounted for the largest cohort at more than 330,000 employees, followed by clinical support staff at 290,000, scientific and technical staff at 163,000 and doctors at 133,000. In June 2018, the Royal College of Physicians calculated that medical training places need to be increased from 7,500 to 15,000 by 2030 to take account of part-time working among other factors. At that time there were 47,800 consultants working in
6713-643: The NIRS/2 system from its inception when problems with the new system attracted widespread media coverage. Due to these computer problems, Deficiency Notices (telling individuals of a possible shortfall in their contributions), which had been sent out on an annual basis prior to 1996, stopped being issued; the Inland Revenue took several years to clear the backlog. As a result, many customers were unaware whether they had incomplete years of contributions towards their State Pension (including women affected by
6850-713: The NPS computer system ( National Insurance and PAYE Service ). This came into use in June and July 2009 and brought NIC and Income Tax records together on one system for the first time. The original National Insurance Recording System (NIRS) was a more archaic system first used in 1975 without direct user access to its records. A civil servant working within the Contributions Office (NICO) would have to request paper printouts of an individual's account which could take up to two weeks to arrive. New information to be added to
6987-442: The UK are in general not entitled to free hospital treatment, with some exceptions such as refugees . People not ordinarily resident may be subject to an interview to establish their eligibility, which must be resolved before non-emergency treatment can commence. Patients who do not qualify for free treatment are asked to pay in advance or to sign a written undertaking to pay, except for emergency treatment. People from outside
SECTION 50
#17327660520267124-464: The UK can use the NHS without being asked to pay the full cost of the service, though NHS dentistry and optometry do have standard charges in each of the four national health services in the UK. In addition, most patients in England have to pay charges for prescriptions though some patients are exempted. Aneurin Bevan , in considering the provision of NHS services to overseas visitors wrote, in 1952, that it would be "unwise as well as mean to withhold
7261-456: The UK had increased by more than any country despite the significant drop in national income due to the COVID pandemic. The Labour Government elected in 2024 stated that their policy was that the "NHS is broken". They announced an immediate stocktake of current pressures and the reasons for them led by Labour peer Lord Ara Darzi. This was to be followed by development of a new "10 year plan" for
7398-456: The UK of which 15,700 were physicians. About 20% of consultants work less than full-time. Brexit , in 2020, was predicted to affect medical practitioners from EU countries who worked in the NHS, accounting for more than 1-in-10 doctors at the time. A 2017 survey suggested 60% of these doctors were considering leaving, with a record 17,197 EU staff leaving the NHS in 2016. The figures led to calls to reassure European workers over their future in
7535-453: The UK welfare state does insufficient work to prevent poverty , deprivation and even hunger . In 2018, food bank usage in the UK reached its highest point on record, with the UK's main food bank provider, The Trussell Trust , stating that welfare benefits do not cover basic living costs. The Trussell Trust's figures showed that 1,332,952 three-day emergency food supplies were delivered to people from March 2017 to March 2018. This represented
7672-490: The UK, a tax code cannot be operated without one. An NI number is in the format: two letters, six digits and one further letter or a space. The example used is typically QQ123456C. It is usual to pair off the digits - such separators are seen on forms used by government departments (both internal and external, notably the P45 and P60 ). National Insurance contributions for all UK residents and some non-residents are recorded using
7809-491: The UK. A study by the Centre for Progressive Policy called for NHS trusts to become "exemplar employers" by improving social mobility and pay especially for those "trusts in poorer places where they can play a particularly large role in determining the economic wellbeing of the local population." They found the NHS to be " a middle ranking employer in comparison to other large organisations and falls short on social mobility and
7946-501: The United Kingdom began to evolve in the 1900s and early 1910s, and comprises expenditures by the government of the United Kingdom of Great Britain and Northern Ireland intended to improve health, education, employment and social security . The British system has been classified as a liberal welfare state system. Before the official establishment of the modern welfare state, clear examples of social welfare existed to help
8083-416: The account would be sent to specialised data entry operatives on paper to be input into NIRS. NIRS/2, introduced in 1996, was a large and complex computer system which had several uses. These included individual applications to access or update an individual National Insurance account, to view employer's National Insurance schemes and a general work management application. There was some controversy regarding
8220-449: The bedroom tax, the benefit cap and the rollout of universal credit push families deeper into poverty." Social security payments in 2019 were the lowest they had been since the welfare state was started and food bank use had increased. The Institute for Public Policy Research (IPPR) found £73 per week, (which is standard for Universal Credit that 2.3 million people claim) amounted to 12.5% of median earnings. When unemployment benefit
8357-473: The benefits which are related to the contributions, a National Insurance number is necessary. The current system of National Insurance has its roots in the National Insurance Act 1911 , which introduced the concept of benefits based on contributions paid by employed people and their employer. William Martin-Smith was issued with the First NI number A1. The chosen means of recording the contributions required
SECTION 60
#17327660520268494-747: The bills and buy adequate food. Likewise, an unknown number are unable to clothe their children properly before sending them to school where all too many of these children not only rely on free school dinners as a cornerstone of their diet, but on breakfast and supper clubs as well." In the financial year 2014/15, state pensions were overwhelmingly the largest governmental welfare expense, costing £86,500,000,000 followed by housing benefit , which accounted for over £20,000,000,000 Expenditure in 2015–16 on benefits included: £2,300,000,000 paid to unemployed people and £27,100,000,000 to people on low incomes, and £27,600,000,000 for personal tax credits. UK Government welfare expenditure 2011–12 (percent) In 2023/24, it
8631-467: The breadline have at least one relative with a disability. Cuts include, tax credits (£4.6bn), universal credit (£3.6bn), child benefit (£3.4bn), disability benefits (£2.8bn), Employment and Support Allowance and Incapacity Benefit (£2bn) and housing benefit (£2.3bn). Frank Field said, "A £37bn attack has been mounted on the living standards of many of our fellow citizens to such an extent that possibly millions struggle to keep on top of their rent, pay
8768-506: The breadline include at least one person with a disability. There are also cuts to tax credits Universal Credit child benefit disability benefits ESA and incapacity benefit and housing benefit . Alison Garnham of the Child Poverty Action Group said, "Cuts and freezes have taken family budgets to the bone as costs rise and there is more pain to come as the two-child limit for tax credits and universal credit,
8905-495: The cap on health service pay, claiming the cap is damaging the health service and damaging patient care. In 2017, the pay rise was likely to be below the level of inflation and to mean a real-terms pay cut. In 2017, the House of Commons Library research predicted that that real-terms NHS funding per head was to fall in 2018–19, and stay the same for two years afterwards. In January 2018, The Guardian reported that GPs faced excessive workloads throughout Britain and that this put
9042-501: The causes of individual contingencies and needs. Economically, the net losers of the welfare state are often more against its values and role within society. In 2010, the Conservative-Lib Dem coalition government led by David Cameron argued for a reduction of welfare spending in the United Kingdom as part of their programme of austerity . Government ministers have argued that a growing culture of welfare dependency
9179-499: The contemporary healthcare system of voluntary and private hospitals "more than that of a taxpayer funded healthcare" believing more people would access healthcare when they need it if they were voluntarily involved in their own healthcare. But it is key to note Beveridge still emphasised that healthcare should be accessible for everyone in the United Kingdom and that people should give what they can according to their means when receiving healthcare in voluntary hospitals. Beveridge himself
9316-481: The correct table letter to each employee depending on their particular circumstances. Each tax year, HMRC publish look-up tables for each table letter to assist with manual calculation of contributions, though these days most of the calculations are done by computer systems and the tables are available only as downloads. In addition, HMRC provide an online National Insurance Calculator. Class 1A contributions were introduced from 6 April 1991, and are paid by employers on
9453-599: The cradle to the grave." After the Second World War, the Attlee government pressed ahead with the introduction of the Welfare State , of which an expanded National Insurance scheme was a major component. As part of this process, in 1948, a single stamp was introduced which covered all the benefits of the new Welfare State. At that point, responsibility passed to the new Ministry of National Insurance; many of
9590-592: The department is making 4,000 training positions available for GPs every year, which help create an extra 50 million appointments annually. In 2023, a report revealed that NHS staff had faced over 20,000 sexual misconduct from patients from 2017 to 2022 across 212 NHS Trusts. Some of the claims included rape, sexual harassment, stalking, and sexualised remarks at staff from patients. In the report, female staff members were told by hospitals to continue caring for patients even after there were issues regarding abuse or harassment without further safeguards in place. Other parts of
9727-465: The economy. This Thatcherite consensus was characterised by policies such as Privatisation, driven by her belief in Individualism and Competition. Therefore, her main focus was to attempt to control public spending, privatisation, targeting and rising inequality, so much of the 1980s was focused on cutting public spending in the UK. Policies differ in different regions of the United Kingdom, but
9864-496: The employee contribution is referred to as the 'primary' contribution and the employer contribution as the 'secondary', but they are usually referred to simply as employee and employer contributions. The employee contribution is deducted from gross wages by the employer, with no action required by the employee. The employer then adds in their own contribution and remits the total to HMRC along with income tax and other statutory deductions. Contributions for employees are calculated on
10001-574: The employee rates are as shown below and the non-zero employer rates are 0.5% lower than those shown below. Class 2 contributions are fixed weekly amounts paid by the self-employed until 5 April 2024. They are due regardless of trading profits or losses, but those with low earnings can apply for exemption from paying and those on high earnings with liability to either Class 1 or 4 can apply for deferment from paying. As of January 2020, self-employed National Insurance Contributions (NICs) will be categorised as Class 2 when profits are between £6,365 and £8,631.99
10138-583: The employer is liable to pay. National Insurance contributions form a significant proportion of the UK Government's revenue, raising £145 billion in 2019-20 (representing 17.5% of all tax revenue). The benefit component includes several contributory benefits, availability and amount of which is determined by the claimant's contribution record and circumstances. Weekly income and some lump-sum benefits are provided for participants upon death, retirement, unemployment, maternity and disability. In order to obtain
10275-404: The employer meets the tax liabilities on certain benefits). Class 1B contributions are paid at the same rate as Class 1A contributions and do not provide any benefit entitlement for individuals. Contribution rates are set for each tax year by the government. The general rates for the tax year 2023/24 between 6 January and 5 April 2024 are shown below. For those who qualify for the mariners rates,
10412-564: The employer to buy special stamps from a Post Office and affix them to contribution cards. The cards formed proof of entitlement to benefits and were given to the employee when the employment ended, leading to the loss of a job often being referred to as being given your cards , a phrase which endures to this day although the card itself no longer exists. Initially there were two schemes running alongside each other, one for health and pension insurance benefits (administered by "approved societies" including friendly societies and some trade unions) and
10549-521: The end of their first term in office. The limits were harmonised on 6 July 2022. The limits and rates for the following tax year are normally announced at the same time as the autumn budget made by the Chancellor of the Exchequer. Current rates are shown on the hmrc.gov.uk website. The calculation of contributions for employees has to be made on each pay period (for non-directors of a company). As
10686-512: The first of many controversies over changes to the NHS throughout its history. From its earliest days, the cultural history of the NHS has shown its place in British society reflected and debated in film, TV, cartoons and literature. The NHS had a prominent slot during the 2012 London Summer Olympics opening ceremony directed by Danny Boyle , being described as "the institution which more than any other unites our nation". Everyone living in
10823-497: The former approved societies went into liquidation as a result. Stamp cards for class 1 (employed) contributions persisted until 1975 when these contributions finally ceased to be flat-rate and became earnings related, collected along with Income Tax under the PAYE procedures. Making NI contributions is still often described by people as paying their stamp . As the system developed, the link between individual contributions and benefits
10960-663: The free service from the visitor to Britain. How do we distinguish a visitor from anybody else? Are British citizens to carry means of identification everywhere to prove that they are not visitors? For if the sheep are to be separated from the goats both must be classified. What began as an attempt to keep the Health Service for ourselves would end by being a nuisance to everybody." The provision of free treatment to non-UK-residents, formerly interpreted liberally, has been increasingly restricted, with new overseas visitor hospital charging regulations introduced in 2015. Citizens of
11097-482: The general population of the UK. This argument does stand when you compare certain statistics with some of Europe's biggest nations. The UK has a tax revenue, as a share of GDP percentage of 12.55%... this is in this is simply incomparable when matched with France's (57%), Germany's (66.66%), and Italy's (75%). It was also found, in a 2021 study by The Health Foundation, that Britain spends the 6th most money on health care amongst "developed countries." This figure sits below
11234-659: The implementation of these suggested policies aimed to reduce income, health, and educational inequalities. However, the lack of real follow-through on Beveridge's recommended strategies meant that the Labour government ultimately failed to abolish poverty with their welfare reforms. Included among the laws passed were the National Assistance Act 1948 ( 11 & 12 Geo. 6 . c. 29), National Insurance Act 1946 , and National Insurance (Industrial Injuries) Act 1946 . This policy resulted in increased expenditure and
11371-522: The imposition of a training condition would be impractical if the unemployed were numbered by the million. After its victory in the 1945 general election , the Labour Party pledged to eradicate the Giant Evils, and undertook policy measures to provide for the people of the United Kingdom "from the cradle to the grave." While the original intention of the report was to abolish these Giant Evils,
11508-506: The introduction of family allowances. Many people welcomed this government intervention and wanted it to go further. The Beveridge Report of 1942, (which identified five "Giant Evils" in society: squalor, ignorance, want, idleness and disease) essentially recommended a national, compulsory, flat rate insurance scheme which would combine unemployment, widows benefit, child benefit and retirement benefits into one central government support scheme. In regards to healthcare Beveridge preferred
11645-604: The late 1970s. An actuarial evaluation of the long-term prospects for the National Insurance system is mandated every 5 years, or whenever any changes are proposed to benefits or contributions. Such evaluations are conducted by the Government Actuary's Department and the resulting reports must be presented to the UK Parliament. The most recent review was conducted as at April 2020, with the report being published two years later. The contributions component of
11782-558: The levels of poverty in Britain. These reports indicated that in the massive industrial cities, between one-quarter and one-third of the population were living below the poverty line . A 2022 study linked trade shocks during the first globalization (1870–1914) with increased support for a welfare state and reduced support for the Conservative Party. The late nineteenth century saw the emergence of New Liberalism within
11919-648: The needs of everyone, that it be free at the point of delivery, and that it be based on clinical need, not ability to pay. Three years after the founding of the NHS, Bevan resigned from the Labour government in opposition to the introduction of charges for the provision of dentures, dentists, and glasses ; resigning in support was fellow minister and future Prime Minister Harold Wilson . The following year, Winston Churchill 's Conservative government introduced prescription fees. However, Wilson's government abolished them in 1965; they were later re-introduced but with exemptions for those on low income. These charges were
12056-451: The new funding is to be efficiently used the NHS will need a comprehensive and fully funded workforce strategy to ensure future supply of staff. In March 2022, Rishi Sunak doubled the annual efficiency target for the NHS in England. The 2.2 per cent target would deliver annual savings of saving of £4.75 billion. At the same time the additional Covid funding is being removed in 2022–23. At the same time Sir Charles Bean , recently leader of
12193-592: The new partnership as overdue, while Plaid Cymru criticized it as insufficient for addressing deeper issues within the Welsh NHS. There was a concern that a disorderly Brexit might have compromised patients' access to vital medicines. In February 2018, many medical organisations planned for a worst-case Brexit scenario because "time is running out" for a transition deal to follow the UK's formal exit that occurred in March 2019. Pharmaceutical organisations working with
12330-496: The next forty years. The Liberal Party introduced multiple reforms on a range of issues, including health insurance , unemployment insurance , and pensions for elderly workers, thereby laying the groundwork for the future British welfare state . Some proposals failed, such as licensing fewer pubs, or rolling back Conservative educational policies. The People's Budget of 1909, championed by David Lloyd George and fellow Liberal Winston Churchill , introduced unprecedented taxes on
12467-467: The number of GPs has fallen by 1,622. Some family doctors have 2,500 patients each, forcing patients to attend A&E instead. Certain regions have fewer than 50 GPs per 100,000 people, while other regions have more than 70, presenting a challenge to the NHS's founding principle of equal treatment. A growing number of family doctors are reporting unsustainable workloads, and many have chosen to work part-time. A Health and Social Care spokesperson said that
12604-544: The official historian of the NHS, Charles Webster , called an "audacious campaign" to take charge of the form the NHS finally took. Bevan's National Health Service was proposed in Westminster legislation for England and Wales from 1946 and Scotland from 1947, and the Northern Ireland Parliament 's Public Health Services Act 1947. NHS Wales was split from NHS (England) in 1969 when control
12741-454: The other for unemployment benefit which was administered directly by Government. The Beveridge Report in 1942 proposed expansion and unification of the welfare state under a scheme of what was called social insurance. In March 1943 Winston Churchill in a broadcast entitled " After the War " committed the government to a system of "national compulsory insurance for all classes for all purposes from
12878-420: The past) are liable to charges for services. There are some other categories of people who are exempt from the residence requirements such as specific government workers and those in the armed forces stationed overseas. In 2016, the systems were 98.8% funded from general taxation and National Insurance contributions, plus small amounts from patient charges for some services. As of 2016, about 10% of GDP
13015-538: The patients. In wards which had not closed staff sometimes worked under stress due to staff shortages. It was also predicted then, that Brexit was likely to aggravate those problems. In November 2019, it was reported that due to the shortage of nurses the NHS was then relying on less qualified staff like healthcare assistants and nursing associates. For the period between 2010 and 2018 the Health Foundation funded research by Birmingham University said there
13152-489: The period of 2014 to 2015, compared to 2,507 people in the period of 2011 to 2012. In 2020, the UK Government admitted that it had made no assessment of the impact that benefit sanctions made on mental health. At the same point in time the Government also refused to assess the impact benefit sanctions have on people's mental health, which came after repeated warnings on the long-term damage they can cause to people that use
13289-425: The personal relationship between doctor and patient. Conservative MPs voted in favour of their amendment to Bevan's Bill to maintain local control and ownership of hospitals and against Bevan's plan for national ownership of all hospitals. The Labour government defeated Conservative amendments and went ahead with the NHS as it remains today; a single large national organisation (with devolved equivalents) which forced
13426-643: The poor and vulnerable within British society. A key date in the welfare state's history is 1563; when Queen Elizabeth I's government encouraged the wealthier members of society to give to the poor, by passing the Poor Act 1562 . The welfare state in the modern sense was anticipated by the Royal Commission into the Operation of the Poor Laws 1832 which found that the Poor Relief Act 1601 (a part of
13563-528: The poverty, squalor, and ignorance in which many people lived made it impossible for freedom and individuality to flourish. New Liberals believed that these conditions could be ameliorated only through collective action coordinated by a strong, welfare-oriented, and interventionist state. After the historic 1906 victory, the Liberal Party launched the welfare state with a series of major welfare reforms in 1906–1914. The reforms were greatly extended over
13700-630: The provision of a welfare state is still a basic principle of government policy in the United Kingdom today. The principle of health care "free at the point of use" became a central idea of the welfare state, which later Conservative governments, although critical of some aspects of the welfare state, did not reverse. Welfare spending on poor people dropped by 25% under the United Kingdom government austerity programme , cuts to benefits that disabled people receive were significant, Personal Independence Payments and Employment and Support Allowance have both dropped by 10%. Over half of families living below
13837-448: The real Living Wage", and ranked trusts using a 'good employer index'. Ambulance trusts were ranked worst. On 6 June 2022, The Guardian said that a survey of more than 20,000 frontline staff by the nursing trade union and professional body, the Royal College of Nursing , found that only a quarter of shifts had the planned number of registered nurses on duty. The NHS is facing a shortage of general practitioners . From 2015 to 2022,
13974-419: The remaining 20% split between buildings, equipment, training costs, medical equipment, catering and cleaning. Nearly 80% of the total budget is distributed by local trusts in line with the particular health priorities in their areas. When the NHS was launched in 1948 it had a budget of £437 million (equivalent to £20.07 billion in 2023). In 2016–2017, the budget was £122.5 billion. In 1955/56 health spending
14111-437: The report showed that staff were pressured into not reporting grievances. In June 2023, the delayed NHS Long term Workforce Plan was announced, set up to train more doctors and nurses and create new roles within the health service. In 2024, multiple NHS hospitals started mandating radiographers to ask all male patients aged 12 to 55 if they were pregnant. This policy was instated as part of an 'inclusivity' drive and received
14248-530: The rise in State Pension age ). As noted above, the employee contribution was a flat rate stamp until 1975. After this, the rates have been as follows: On 7 September 2021, the government announced an increase of NI rates by 1.25 percentage points for the 2022–23 tax year, breaking its 2019 manifesto promise. From 2023, a new health and social care levy charged at the 1.25% rate would be introduced with NI rates reverting to their previous rates. This move
14385-419: The same Labour government that had founded the NHS three years earlier, and prescription charges by the successive Conservative Government were introduced in 1952. In 1988, free eye tests for all were abolished, although they are now free for the over-60s. After 1979, Margaret Thatcher had laid the post-war Keynesian consensus to rest, in favour of an Individualist and Monetarist Welfare policy, guided by
14522-467: The same year the DWP were accused of a "cover-up" due to destroying approximately 50 reports connected to benefits being stopped. Officials blamed data protection laws for the actions, though the data watchdog denied there was any requirement to destroy the documents by any date. In March 2022, an academic study into whether benefit sanctions are linked to claimant ill-health, including mental illness and suicide
14659-523: The state in British society. The end of the war also brought a period of unemployment and poverty , particularly in northern industrial towns, that deepened into the Great Depression by the 1930s. During the war, the government became much more involved in people's lives via governmental organisation of the rationing of foodstuffs, clothing and fuel and extra milk and meals being given to expectant mothers and children. The wartime coalition, and
14796-538: The system, "National Insurance Contributions" (NICs) are paid by employees and employers on earnings, and by employers on certain benefits-in-kind provided to employees. The self-employed contribute partly by a fixed weekly or monthly payment, and partly on a percentage of net profits above a certain threshold. Individuals may also make voluntary contributions, in order to fill a gap in their contributions record and thus protect their entitlement to benefits. Contributions are collected by HM Revenue and Customs (HMRC) through
14933-519: The text: "based on statistics of weekly earnings, Employment and Productivity Gazette ." Housing National Health Service The National Health Service ( NHS ) is the umbrella term for the publicly funded healthcare systems of the United Kingdom , comprising the NHS in England, NHS Scotland and NHS Wales . Health and Social Care in Northern Ireland was created separately and
15070-590: The total health sector workforce across the United Kingdom was 1,499,368 making it the seventh largest employer and second largest non-military public organisation in the world. When purchasing consumables such as medications, the four healthcare services have significant market power that influences the global price, typically keeping prices lower. A small number of products are procured jointly through contracts shared between services. Several other countries directly rely on Britain's assessments for their own decisions on state-financed drug reimbursements. Calls for
15207-431: The transfer of ownership of hospitals from local authorities and charities to the new NHS. Bevan's principle of ownership with no private sector involvement has since been diluted, with later Labour governments implementing large scale financing arrangements with private builders in private finance initiatives and joint ventures. At its launch by Bevan on 5 July 1948 it had at its heart three core principles: That it meet
15344-550: The usage of foodbanks nationwide: 2.17m food bank users in 2021/22 in comparison to the 41,000 in 2009/10. During the COVID-19 crisis, food insecurity impacted 16% of the population, and some critics argue that government food aid was instigated too late for the elderly and vulnerable. There have also been criticisms of the food parcels given, as reports stated that the parcels lacked nutritional food and instead contained an abundance of processed foods. Note on source, as quoted in
15481-405: The value of company cars and certain other benefits in kind provided to their employees and directors, at the standard employer contribution percentage rate for the tax year. Class 1A contributions do not provide any benefit entitlement for individuals. Class 1B contributions were introduced on 6 April 1999 and are payable by employers as part of a PAYE Settlement Agreement (an arrangement whereby
15618-529: The wealthy in Britain and radical social welfare programmes to the country's policies. In the Liberal camp, as noted by one study, "the Budget was on the whole enthusiastically received." It was the first budget with the expressed intent of redistributing wealth among the public. It imposed increased taxes on luxuries, liquor, tobacco, high incomes, and land – taxation that fell heavily on the rich . The new money
15755-435: The welfare state and to these people's families. Also in 2020, it was reported that at least 69 suicides were linked to the DWP's handling of benefit claims. The National Audit Office (NAO) said the actual number of deaths linked to claims could be much higher than this. It was also reported that the DWP were not looking into information from coroners or families, nor investigating all the reports of suicide made aware to it. In
15892-413: The year to 2018. It was also said that some expressed doubt over whether May could carry out this proposed increase in funding. The next day, Health Secretary Jeremy Hunt backed the extra £20bn annual increase in NHS funding and responded to criticism by stating that taxation would be used to carry out the funding and that details would be revealed at the next budget. In June 2018 it was reported that
16029-1099: The year, based on figures supplied on the SA100 tax return . Contributions are based around two thresholds, the Lower Profits Limit (LPL) and the Upper Profits Limit (UPL). These have the same cash values as the Primary Threshold and Upper Earnings Limit used in Class 1 calculations. Class 4 contributions do not form part of a qualifying contribution record for any benefits, including the State Pension, as self-employed people qualify for these benefits by paying Class 2 contributions. People who are unable to work for some reason may be able to claim NI credits (technically credited earnings , since 1987). These are equivalent to Class 1 NICs, though are not paid for. They are granted either to maintain
16166-454: Was 11.2% of the public services budget. In 2015/16 it was 29.7%. This equates to an average rise in spending over the full 60-year period of about 4% a year once inflation has been taken into account. Under the Blair government spending levels increased by around 6% a year on average. Between 2010 and 2017 spending growth was constrained to just over 1% a year. A 2019 report said that a study by
16303-499: Was a contributory form of insurance against illness and unemployment, and eventually provided retirement pensions and other benefits. Currently, workers pay contributions from the age of 16 years, until the age they become eligible for the State pension. Contributions are due from employed people earning at or above a threshold called the Lower Earnings Limit, the value of which is reviewed each year. Self-employed people contribute through
16440-417: Was born out of the ideal that healthcare should be available to all, regardless of wealth. Although being freely accessible regardless of wealth maintained Henry Willink 's principle of free healthcare for all, Conservative MPs were in favour of maintaining local administration of the NHS through existing arrangements with local authorities fearing that an NHS which owned hospitals on a national scale would lose
16577-438: Was careful to emphasise that unemployment benefits should be held to a subsistence level, and after six months would be conditional on work or training, so as not to encourage abuse of the system. That was however predicated on the concept of the "maintenance of employment" which meant 'it should be possible to make unemployment of any individual for more than 26 weeks continuously a rare thing in normal times' and recognised that
16714-588: Was costing about £10,000 per household in the UK. This, they said, reflected the third highest share of GDP of any nation in Europe. This was said to show that the UK "has one of the most costly health systems – and some of the worst outcomes". The findings were made before the government increased health spending significantly, with a 1.25% increase in National Insurance , in April 2022. Civitas said this showed evidence "runaway" spending as health spending in
16851-482: Was increased to £400 in 2018. The discounted rate for students and those on the Youth Mobility Scheme will increase from £150 to £300. From 15 January 2007, anyone who is working outside the UK as a missionary for an organisation with its principal place of business in the UK is fully exempt from NHS charges for services that would normally be provided free of charge to those resident in the UK. This
16988-547: Was insufficient and falling NHS capital spending that put patient care and put staff productivity at risk. The Health Foundation said that £3.5 billion more a year would be required to get capital spending to the OECD average. Spending limits were effecting service efficiency, and patient care. Shortages of equipment and equipment failures had an impact as did relying on ageing diagnostic equipment. In 2018, British Prime Minister Theresa May announced that NHS in England would receive
17125-592: Was introduced in 1948 it amounted to 20%. Millions of people in 2019 were "excluded from mainstream society, with the basic goods and amenities needed to survive let alone thrive increasingly out of their grip". The IPPR urged all parties to add an emergency £8.4bn into the welfare system, which has become harder than previous systems because debt deductions are made from payments, there is increasing underpayment and strict sanctions are applied. One in three universal credit claimants are working. Numerous negative consequences have been attributed to benefit sanctions imposed by
17262-452: Was not to substantially increase provision but to standardise care across the country; indeed William Beveridge believed that the overall cost of medical care would decrease, as people became healthier and so needed less treatment. However, instead of falling, the cost of the NHS has risen by 4% annually on average due to an ageing population, leading to a reduction in provision. Charges for dentures, and spectacles were introduced in 1951 by
17399-699: Was passed to the Secretary of State for Wales . According to one history of the NHS, "In some respects the war had made things easier. In anticipation of massive air raid casualties, the Emergency Medical Service had brought the country's municipal and voluntary hospitals into one umbrella organisation, showing that a national hospital service was possible." Webster wrote in 2002 that "the Luftwaffe achieved in months what had defeated politicians and planners for at least two decades." The NHS
17536-551: Was reported that Cancer Research UK maintained that more NHS cancer personnel were needed to enable the UK to catch up The NHS in England was expanding early diagnosis services with the goal of increasing the proportion of cancers diagnosed early (at stages 1 and 2) from 53% to 75% in the decade to 2028. In September 2018, it was reported that the NHS was the first health service in Europe to negotiate coverage for novel CAR-T cancer therapy, with agreement reached within 10 days of its European marketing authorisation. On 7 January 2019,
17673-462: Was reported that death rates from breast cancer were falling faster in Britain than in any other of the six largest countries in Europe, and were estimated then to have improved beyond the European average. In October 2018, according to Breast Cancer Care , 72% of NHS trusts across the UK did not provide dedicated specialist nurses for patients with incurable breast cancer." In September 2019 it
17810-479: Was reported that staff shortages at histology departments were delaying diagnosis and start of treatment for cancer patients. In England and Scotland cancer wards and children's wards have to close because the hospital cannot attract sufficient qualified doctors and nurses to run the wards safely. In November 2018 it was reported that cancer patients and child patients were having to travel very long distances to get treatment and their relatives had to travel far to visit
17947-582: Was reversed by new chancellor Kwasi Kwarteng effective 6 November 2022. In the early 2000s the lower threshold for employee contributions was aligned with the standard personal allowance for Income Tax but has since diverged significantly, as illustrated in the following table. For 2015–16 there was therefore up to £304.80 payable by someone who has not reached the point where they are liable for Income Tax. This has risen to £352.80 for 2016–17, to £400.32 for 2017–18, to £411.12 for 2018-19 and to £464.16 for 2019–20. This fell to £360 for 2020–21. The upper limit
18084-480: Was short of doctors, foreign doctors were forced to leave the UK due to visa restrictions. A study reported in November 2018 found that a fifth of doctors had faced bullying from seniors in the previous year due to pressure at work. In May 2018 it was reported that the NHS was under-resourced compared to health provisions in other developed nations. A King's Fund study of OECD data from 21 nations, revealed that
18221-540: Was spent on health and was the most spent in the public sector. In 2019, the UK spent roughly 10.2% of GDP on healthcare compared to 11.7% in Germany and 11.1% in France. The money to pay for the NHS comes directly from taxation. The 2008/09 budget roughly equated to a contribution of £1,980 per person in the UK. Some 60% of the NHS budget is used to pay staff. A further 20% pays for pharmaceuticals and other supplies, with
18358-486: Was stopped after the DWP and Government ministers refused to release their recorded data on sanctions. From a contemporary perspective, in practice, social welfare in the United Kingdom is very different from the ideal version of the welfare state that people may carry. Coverage is extensive, but benefits and services are delivered at a low level. The social protection provided is patchy, and services are tightly rationed." This opinion appears to be growing in popularity amongst
18495-438: Was thought that inflation may erode the real value of this funding increase. As part of the 2018 funding increase the UK Government asked the NHS in England to produce a 10-year plan as to how this funding would be used. In September 2019, it was reported that cancer survival rates in the UK had been rising fast but probably still lagged behind the best results internationally, mainly because of late diagnosis. In March 2019 it
18632-513: Was to be made available for new welfare programmes as well as new battleships. In 1911 Lloyd George succeeded in putting through Parliament his National Insurance Act , making provision for sickness and invalidism, and this was followed by his Unemployment Insurance Act . The minimum wage was introduced in Great Britain in 1909 for certain low-wage industries and expanded to numerous industries, including farm labour, by 1920. However, by
18769-475: Was weakened. The National Insurance Funds are used to pay for certain types of welfare expenditure and National Insurance payments cannot be used directly to fund general government spending. However, any surplus in the funds is invested in government securities, and so is effectively lent to the government at low rates of interest. National Insurance contributions are paid into the various National Insurance Funds after deduction of monies specifically allocated to
#25974