Osborne makes right call on National Insurance contributions
Osborne makes right call on National Insurance contributions but immediate spending cut a gamble, says CIPD
Dr John Philpott, chief economic adviser at the Chartered Institute of Personnel and Development (CIPD) responds as follows to todays announcement that the Conservatives will scrap the 1% rise in NICs planned for April 2011:
"George Osborne's proposal to cut much of the government's hike in employer's national insurance contributions shows that he has wisely listened to British business. The CIPD welcomes Mr Osborne's move, accepting that it would be difficult for him to cancel the planned increase in full. The move will be good for jobs.
However, the shadow chancellor is perhaps less wise in proposing to cut 6 billion from Labour's spending plans in 2010-11. The case for and against immediate action to reduce the fiscal deficit may be finely balanced but with the economy recovery still very weak and potentially fragile, Mr Osborne is in this respect clearly taking a gamble on growth and employment."