National Insurance Contributions (Employer Pensions Contributions) Bill: motion to disagree with Lords Amendment 5

What was this vote about?

This was a lords amendment on the National Insurance Contributions (Employer Pensions Contributions) Bill. The bill would bring salary-sacrificed employer pension contributions into National Insurance (NICs) when they exceed an annual cap, with the cap set by regulations. An initial £2,000 cap would apply from 2029, and any amount above the cap would be treated as earnings for NICs purposes (not affecting existing income tax relief). The Treasury would have powers to set and adjust the cap and related rules by regulations, with Parliament supervising those regulations.

• • establishes an annual cap on salary-sacrificed employer pension contributions for NICs purposes (initially £2,000, effective from 2029-30), with rules to determine how the cap works across Great Britain and Northern Ireland
• • the excess over the cap would be liable to NICs as earnings, while existing pension reliefs and income tax treatment remain unchanged
• • the bill relies on secondary legislation to set details (how the cap is calculated, when it starts, and how it applies); some regulatory changes would be subject to parliamentary procedures
• • Lords amendments proposed to raise the cap (to £5,000 or higher), uprate it (by CPI/RPI or other measures), allow carry-forward of unused amounts for up to three tax years, and create exemptions for SMEs and charities; there were also proposals on lifetime pension value projections, independent impact reviews, and broader scrutiny

The result

448 of 650 eligible MPs voted (69% turnout)

How each party voted

Who rebelled?

Why it matters

In a 281-167 division, the House of Commons backed the government and voted to disagree with Lords Amendment 5 to the National Insurance Contributions (Employer Pensions Contributions) Bill. The Lords amendment would have added several reporting clauses, requiring Treasury reviews on the bill’s impact on SMEs, recruitment and retention, and employees’ marginal tax rates, plus assessments of pension saving through salary sacrifice. Two MPs voted against their party whip in this division, reflecting ongoing debate over additional oversight alongside the bill’s reforms.

AI-generated context — may contain errors.

Turnout by party

What happens next?

The Lords amendment result is sent back to the other House for consideration.

Current stage: Consideration of Commons amendments and / or reasons