Social Security Administration Act 1992

162 Destination of contributions

(1) Contributions received by the Secretary of State under Part I of the Contributions and Benefits Act shall be paid by him into the National Insurance Fund after deducting from contributions of any class, the appropriate national health service allocation in the case of contributions of that class.

(2) The contributions referred to in subsection (1) above include those paid over to the Secretary of State by the Inland Revenue under section 16(4) of the Contributions and Benefits Act and paragraph 6(8) of Schedule 1 to that Act, but subsection (1) above is subject to section 16(5) of that Act as respects contributions from Northern Ireland.

(3) The additions paid under section 1(5) of the Contributions and Benefits Act shall be paid, in accordance with any directions given by the Treasury, into the National Insurance Fund.

(4) The sums paid to the Secretary of State by the Inland Revenue under section 16(4)(b) of the Contributions and Benefits Act and paragraphs 6(8)(b) and 7(7) of Schedule 1 to that Act in respect of interest and penalties recovered by them in connection with contributions of any class shall, subject to section 16(5) of that Act, be paid, in accordance with any directions given by the Treasury, into the National Insurance Fund.

(5) In subsection (1) above “the appropriate national health service allocation” means—

(a) in the case of primary Class 1 contributions, 1.05 per cent. of the amount estimated to be that of the earnings in respect of which those contributions were paid at the main primary percentage rate;

(b) in the case of secondary Class 1 contributions, 0.9 per cent. of the amount estimated to be that of the earnings in respect of which those contributions were paid;

(c) in the case of Class 1A contributions, 0.9 per cent. of the amount estimated to be the aggregate of the cash equivalents of the benefits of the cars and car fuel used in calculating those contributions;

(d) in the case of Class 2 contributions, 15.5 per cent. of the amount estimated to be the total of those contributions;

(e) in the case of Class 3 contributions, 15.5 per cent. of the amount estimated to be the total of those contributions; and

(f) in the case of Class 4 contributions, 1.15 per cent. of the amount estimated to be that of the earnings in respect of which those contributions were paid.

(6) In subsection (5) above “estimated” means estimated by the Secretary of State in any manner which after consulting the Government Actuary or the Deputy Government Actuary he considers to be appropriate and which the Treasury has approved.

(7) The Secretary of State may, with the consent of the Treasury, by order amend any of paragraphs (a) to (f) of subsection (5) above in relation to any tax year, by substituting for the percentage for the time being specified in that paragraph a different percentage.

(8) No order under subsection (7) above shall substitute a figure which represents an increase or decrease in the appropriate national health service allocation of more than—

(a) 0.1 per cent. of the relevant earnings, in the case of paragraph (a) or (b);

(b) 0.1 per cent. of the relevant aggregate, in the case of paragraph (c);

(c) 4 per cent. of the relevant contributions, in the case of paragraph (d) or (e); or

(d) 0.2 per cent. of the relevant earnings, in the case of paragraph (f).

(9) From the national health service allocation in respect of contributions of any class there shall be deducted such amount as the Secretary of State may estimate to be the portion of the total expenses incurred by him or any other government department in collecting contributions of that class which is fairly attributable to that allocation, and the remainder shall, in the hands of the Secretary of State, be taken as paid towards the cost—

(a) of the national health service in England;

(b) of that service in Wales; and

(c) of that service in Scotland,

in such shares as the Treasury may determine.

(10) The Secretary of State shall pay any amounts deducted in accordance with subsection (9) above into the Consolidated Fund.

(11) Any estimate by the Secretary of State for the purposes of subsection (9) above shall be made in accordance with any directions given by the Treasury.

(12) The Secretary of State may make regulations modifying this section, in such manner as he thinks appropriate, in relation to the contributions of persons referred to in the following sections of the Contributions and Benefits Act—

(a) section 116(2) (H.M.forces);

(b) section 117(1) (mariners, airmen, etc.);

(c) section 120(1) (continental shelf workers),

and in relation to any contributions which are reduced under section 6(5) of that Act.