To ask the Secretary of State for Social Security what representations he has received about the levying of employers' NI contributions on all earnings.

Employers' national insurance contributions are levied on all earnings except where an employee earns below the lower earnings limit. Following a consultation exercise, we have received representations from employers' organisations expressing opposition to proposals put forward by the European Commission which would result in contributions being levied on earnings below that limit.

Does my hon. Friend agree that the cost of abolishing the upper earnings limit would be severe for many middle income earners, such as doctors, teachers and the like, who are absolutely essential to the proper running of our society?

My right hon. Friend alludes to a very important point. He is absolutely right that people such as teachers and members of the nursing profession would be included in a proposal to increase national insurance above the upper limit, but let nobody imagine that would be just those people. Anyone with a wage of, say, £250 per week who received a Christmas bonus of a similar amount would find part of that bonus taxed under the Opposition's proposals. We have flushed out a tax on Christmas.