The National Grid has launched the Great Grid Partnership, a partnership of seven that intends to support the delivery of nine Accelerated Strategic Transmission Investment projects. The partnership aims to speed up the delivery of national electricity infrastructure by coordinating planning and execution, allowing suppliers and the National Grid to pool resources and expertise to deliver faster and more economically, driving value for money and benefits for consumers and local communities. The partnership, as part of the £9bn supply chain framework, will focus on network design and construction for nine major infrastructure projects in England and Wales. It aims to support supply chain capacity, collaboration, 220,000 jobs annually and contribute £18.4bn to GDP.

National Grid has published the RIIO-T3 business plan for its National Grid Electricity Transmission business, covering the period from April 2026 to March 2031. The plan outlines a £35bn investment, comprising £11bn in baseline investment to maintain existing networks and construct its first three Accelerated Strategic Transmission Investment projects, along with £24bn in pipeline investment. Key objectives include maintaining 99.9999% reliability levels, connecting 35 gigawatts of new generation and storage, developing and delivering major network reinforcement and expansion projects, and reducing emissions by 50% compared to the 2018/19 baseline. The plan is subject to Ofgem's review, with draft determinations expected in summer 2025 and final determinations in late 2025.

Energy analysis: As National Grid releases its 2018 ‘Future Energy Scenarios’ (FES) forecasts for the Great Britain (GB) energy sector, an end to most subsidies combined with question marks about electric vehicles (EVs) and decarbonised heat creates an outlook with both obstacles and opportunities. Lis Blunsdon, of Orrick in London, gives her view of some critical priorities as the UK grid enters a state of policy flux.

Payments deducted from pay or declared through self-assessment, used by the DWP to fund the state pension and other state benefits, ie paid or credited contributions to the National Insurance Fund.

The National Insurance Contributions (Employer Pensions Contributions) Act 2026 gives effect to the government’s decision to limit the amount of salary sacrifice pension contributions eligible for National Insurance Contribution (NIC) relief to £2,000 per year with effect from 6 April 2029. Pension contributions above £2,000 made via salary sacrifice will be treated for NIC purposes in the same way as other employee workplace pension contributions, ie primary and secondary Class 1 NICs charge will be applied on such contributions.

The Third Reading of the National Insurance Contributions (Employer Pensions Contributions) Bill took place in the House of Lords on 12 March 2026 following Report stage. Following debate, the Bill was passed at Third Reading with no further amendments made. The Bill implements the government’s decision to limit the amount of salary sacrifice pension contributions eligible for National Insurance Contribution (NIC) relief to £2,000 per year with effect from 6 April 2029.

The House of Commons (HoC) completed the Committee of the Whole House and Third Reading Stages of the National Insurance Contributions (Employer Pensions Contributions) Bill on 21 January 2026, assisting the progress of the introduction from 6 April 2029 of a £2,000 cap above which salary-sacrificed employer pension contributions will have a primary and secondary Class 1 National Insurance contributions (NICs) charge applied. At Committee stage, opposition parties sought to narrow or delay the measure and to require further scrutiny, but the government, represented throughout by Torsten Bell, the Parliamentary Secretary to the Treasury and Minister for Pensions, resisted all proposed changes and the Bill emerged unamended. On the same day at Third Reading, Torsten Bell said reform was inevitable because of the rising cost of pension salary sacrifice and defended the Bill as a pragmatic compromise that retained £2,000 of NIC-free saving with a long lead-in period.  Despite opposition MPs opposing the Bill on the grounds of complexity, distributional impact, and pension adequacy, the Commons passed the Bill unamended by 316 votes to 194 and it now proceeds to the House of Lords.

The House of Lords Grand Committee considered the National Insurance Contributions (Employer Pensions Contributions) Bill on 24 February 2026 when it completed its line-by-line scrutiny of the Bill in one sitting and reported the Bill without amendment. During the debate Clause 1 (Great Britain) and Clause 2 (Northern Ireland) were debated in detail. Opposition and cross-party peers tabled amendments to exempt basic rate taxpayers, address student loan interactions, exclude non-optional employer contributions, adjust or index the £2,000 cap, exempt small and medium-sized enterprises and charities and require reviews of impacts on employers and pension adequacy. All amendments were either withdrawn or not moved. No government amendments were tabled. The government maintained that the £2,000 cap appropriately targets higher earners while protecting most basic rate taxpayers and that existing published assessments were sufficient. The Bill now proceeds to the Report Stage in the House of Lords, where peers may re-table amendments for decision by the House. If amended at the Report Stage, it would return to the House of Commons for consideration of Lords amendments. If unamended through the remaining Lords stages, the Bill will proceed towards Royal Assent in the usual way.

Pensions analysis: The House of Lords considered the National Insurance Contributions (Employer Pensions Contributions) Bill at Report stage on 5 March 2026. The principal debates concerned non-government amendments to Clause 1, relating to employer pension contributions under optional remuneration arrangements in Great Britain, and Clause 2, which makes equivalent provision for Northern Ireland. The House of Lords agreed amendments increasing the cap from £2,000 to £5,000, exempting basic rate taxpayers, protecting student loan calculations, exempting small and medium-sized enterprises (SMEs) and charities, and strengthening parliamentary scrutiny of regulations, all of which the government had opposed on grounds of fiscal sustainability, fairness within the national insurance system, and administrative operability. Following the end of the Report Stage, a revised Bill was published on 5 March 2026 and it now moves to its Third Reading in the House of Lords on 12 March 2026.

The House of Lords gave the National Insurance Contributions (Employer Pensions Contributions) Bill a Second Reading on 4 February 2026, with debate focused on Clause 1, which would introduce a £2,000 annual cap on pension contributions made through salary sacrifice, that are currently exempt from employer and employee national insurance contributions (NICs), applying NICs above the cap from the tax year 2029–30. Lord Livermore, for the government, said the reform was necessary to address the projected growth in the cost of pension salary sacrifice to £8bn a year, which he said was driven largely by higher and additional rate taxpayers, while many lower earners and the self-employed could not access the relief. He said the cap would protect ordinary workers, give employers over three years to prepare, and preserve income tax relief on all pension contributions, with the Office for Budget Responsibility not expecting a material impact on overall pension saving. No amendments were moved during the Second Reading debate , the Bill was read a second time and committed to the Grand Committee, where peers indicated that detailed operational and behavioural issues would be examined further. The Grand Committee is currently scheduled to examine the Bill on 24 and 26 February 2026.

Credits of earnings awarded by the government in certain circumstances (for instance when someone has caring responsibilities). They cover periods when a person is not paying National Insurance contributions.

This Practice Note provides an introduction to National Insurance contributions (NICs), setting out the classes of NICs together with additional detail in respect of Classes 1 and 1A NICs, being those most relevant to employment situations. The stated purpose of National Insurance contributions (NICs) is to fund and enable eligibility for certain state benefits, such as the state pension, and other social security benefits, such as the Jobseeker's Allowance and the Maternity Allowance. NICs are administered by the National Insurance Contributions Office (NICO) which is part of HMRC. Individuals are required to have a National Insurance number. This ensures that any contributions made by them are accurately recorded against their name only. The number remains the same for life, and consists of two letters, followed by six numbers with a final letter. Individuals are sent their National Insurance number shortly before their 16th birthday. This number will be used on all tax-related documents (such as payslips, P60s, etc). An individual can apply to HMRC for a National Insurance number if they require one (for example, if they come