Lord Livermore (Lab)

My Lords, Amendments 8 and 11, tabled by the noble Baronesses, Lady Kramer and Lady Altmann, seek to make commencement of the Act conditional on publication of estimates relating to the distributional impacts of the policy. The Government agree on the importance of transparency. However, we do not believe that additional publications are necessary to achieve that objective. A number of documents have already been published which set out the distributional impacts of this measure. The Government’s budget document sets out that 74% of basic rate taxpayers currently using salary sacrifice will be unaffected by this change. This means that 26% of basic rate taxpayers would pay more. Of those, half will face a modest annual additional NICs liability of less than £50. I have confirmed previously that 87% of pension contributions made via salary sacrifice above £2,000 are forecast to come from higher and additional rate taxpayers. The tax information and impact note was published alongside the introduction of the Bill. This sets out that an estimated 7.7 million employees currently use salary sacrifice to make pension contributions. Of these, 3.3 million sacrifice more than £2,000 of salary or bonuses. This means that 44% of employees using salary sacrifice for pensions would be impacted by this measure, while 56%—around 4.3 million people—are protected by the £2,000 threshold. The tax information impact note sets out the expected equality impact of the measure. It notes that employees with salary sacrifice contributions are estimated to be of typical working age. The 52% who are aged 31 to 50 are estimated to be overrepresented compared with the prevalence in the employee population in general, of 44%. It notes that men are estimated to be overrepresented in the population making salary sacrifice pension contributions compared with the prevalence in the UK adult population. The tax information impact note sets out the number of employers expected to be impacted by this measure—290,000; the one-off costs, including familiarisation with the change, the training of staff and the updating of software; and expected continuing costs, including performing more calculations, and recording and providing additional information to HMRC where salary sacrifice schemes continue to be used. This equates to a one-off £75 and an ongoing £99 per business per year.