The Prime Minister has confessed that the Coalition Government’s scheme to exempt start-ups from paying National Insurance contributions had been disappointing in terms of job creation.
Introduced last September, the initiative was intended to encourage new companies to employ more people by allowing entrepreneurs in certain areas of the UK not to pay NICs when taking on their first 10 employees.
But speaking at an event at financial software provider Intuit‘s headquarters in Maidenhead today, David Cameron said: “The scheme has not worked as well as we hoped. It was too complicated and too targeted at specific businesses. It resulted in around 1,000 jobs but that was not enough. You can come up with all the schemes in the world, but there’s no scheme that’s as good as controlling spending and keeping taxes down. Just like every business needs to control costs, governments aren’t any different.”
Last October, Cameron told the House of Commons that only 7,000 small businesses had taken part in the initiative despite Government predictions that 400,000 would do so.
