Section 165 | Adjustments between National Insurance Fund and Consolidated Fund

From legislation.gov.uk

26 October 2026

(1)There shall be made out of the National Insurance Fund into the Consolidated Fund, or by the Secretary of State out of money provided by Parliament to the Inland Revenue for payment into the National Insurance Fund^F1F2

(a)such payments by way of adjustment as the Secretary of State determines (in accordance with any directions of the Treasury) to be appropriate in consequence of the operation of any enactment or regulations relating to—^F1

(i)Repealed^F3F1

(ii)Repealed^F3F1

(iii)the repayment or offsetting of benefit as defined in section 122 of the Contributions and Benefits Act , universal credit, personal independence payment or other payments; and^F1F4F5

(b)such payments by way of adjustment as the Inland Revenue determine to be appropriate in consequence of the operation of any enactment or regulations relating to—^F1

(i)statutory sick pay; ...^F1F6

(ii)statutory maternity pay;^F1

(iii)... statutory paternity pay;^F1F7F8

(iv)Repealed^F9F1F7

(v)statutory adoption pay; ...^F1F7F10

(vi)statutory shared parental pay, ...^F1F11F12F13

(vii)statutory parental bereavement pay , and^F1F12F14

(viii)statutory neonatal care pay.^F1F14

(2)Where any such payments as are specified in subsection (3) below fall to be made by way of adjustment, then, subject to subsection (4) below,—^F15

(a)the amount of the payments to be made shall be taken to be such, and

(b)payments on account of them shall be made at such times and in such manner,

as may be determined by the appropriate authority.

(2A)In subsection (2) above “the appropriate authority” means—^F16

(a)the Secretary of State, in relation to payments falling to be made by him, or^F16

(b)in Inland Revenue, in relation to payments falling to be made by them;^F16

and any determination by the Secretary of State under that subsection must be made in accordance with any directions given by the Treasury.

(3)The payments mentioned in subsection (2) above are the following, that is to say—

(a)any payments falling to be made by way of adjustment by virtue of subsection (1)(a) and (b) above;^F17

(b)any payments falling to be made by way of adjustment in consequence of the operation of any enactment or regulations relating to child benefit—

(i)out of the National Insurance Fund into the Consolidated Fund, or

(ii)into the National Insurance Fund out of money provided by Parliament; and

(c)any payments falling to be made by way of adjustment in circumstances other than those mentioned in subsection (1) or paragraph (b) above—

(i)out of the National Insurance Fund either to the Secretary of State or another government department or into the Consolidated Fund; or

(ii)into the National Insurance Fund out of money provided by Parliament.

(4)In relation to payments falling within paragraph (a) or (c) of subsection (3) above, subsection (2) above only applies in such cases or classes of case as may be specified—^F18

(a)in relation to payments falling to be made by the Secretary of State, by the Secretary of State by order made with the concurrence of the Inland Revenue, or^F18

(b)in relation to payments falling to be made by the Inland Revenue, by the Inland Revenue by order.^F18

(5)There shall be paid out of the National Insurance Fund into the Consolidated Fund, at such times and in such manner as the Treasury may direct—^F19

(a)such sums as the Inland Revenue may estimate to be the amount of the administrative expenses incurred by them as mentioned in section 163(2)(a) above , or in carrying into effect any relevant legislation, excluding any expenses which the Treasury may direct, or any enactment may require, to be excluded from the Inland Revenue's estimate under this subsection, and^F19F20F21

(b)such sums as the Secretary of State may estimate (in accordance with any directions given by the Treasury) to be the amount of the administrative expenses incurred as mentioned in section 163(2)(a) or (aa) above by any government department other than the Inland Revenue, excluding the expenses specified in subsection (6) below.^F19F22

(5A)There shall be excluded from the estimate under subsection (5)(a) above any expenses attributable to the carrying into effect of provisions of this Act so far as relating to state pension credit.^F23

(5B)In subsection (5)(a) “relevant legislation” means—^F24

(a)legislation relating to ordinary statutory paternity pay, additional statutory paternity pay , statutory adoption pay , statutory parental bereavement pay or statutory neonatal care pay,^F24F25F26

(b)the National Insurance Contributions Act 2014, or^F24

(c)the National Insurance Contributions Act 2015.^F24

(6)The expenses excluded from the estimate under subsection (5)(b) above are—^F19

(a)expenses attributable to the carrying effect of provisions of the Contributions and Benefits Act or this Act relating to the benefits which by virtue of section 163(2) above , section 20 of the State Pension Credit Act 2002 section 27 of the Welfare Reform Act 2007 or section 148 of the Welfare Reform Act 2012 are payable out of the money provided by Parliament; and^F19F27F28

(b)any other category of expenses which the Treasury may direct, or any enactment may require, to be excluded from the Secretary of State's estimate under subsection (5)(b) above;^F19

but none of the administrative expenses of the Christmas bonus shall be excluded from that estimate by virtue of paragraph (a) or (b) above.

Notes

F1
S. 165(1) substituted (25.2.1999 for specified purposes, 1.4.1999 in so far as not already in force) by Social Security Contributions (Transfer of Functions, etc.) Act 1999 (c. 2), s. 28(2)(a), Sch. 1 para. 30(2); S.I. 1999/527, art. 2(b), Sch. 2
F2
Words in s. 165(1) substituted (1.4.1999) by Social Security Contributions (Transfer of Functions, etc.) Act 1999 (c. 2), s. 28(3), Sch. 3 para. 54(2); S.I. 1999/527, art. 2(b), Sch. 2
F3
S. 165(1)(a)(i)(ii) repealed (5.10.1999) by Tax Credits Act 1999 (c. 10), s. 20(2), Sch. 2 para. 26, Sch. 6
F4
Words in s. 165(1)(a)(iii) inserted (29.4.2013) by Welfare Reform Act 2012 (c. 5), s. 150(3), Sch. 2 para. 25(2); S.I. 2013/983, art. 3(1)(b)(ii)
F5
Words in s. 165(1)(a)(iii) inserted (8.4.2013 for specified purposes, 10.6.2013 in so far as not already in force) by Welfare Reform Act 2012 (c. 5), s. 150(3), Sch. 9 para. 25; S.I. 2013/358, art. 7(1)(2)(k), Sch. 3; S.I. 2013/1250, art. 2
F6
Word in s. 165(1)(b)(i) omitted (8.12.2002) by virtue of Employment Act 2002 (c. 22), ss. 6(2)(a)(i), 55(2); S.I. 2002/2866, art. 2(2), Sch. 1 Pt. 2
F7
S. 165(1)(b)(iii)-(v) substituted for s. 165(1)(b)(iii)(iv) (6.4.2010) by Work and Families Act 2006 (c. 18), s. 19(2), Sch. 1 para. 28(2); S.I. 2010/495, art. 4(d)
F8
Word in s. 165(1)(b)(iii) repealed (5.4.2015) by Children and Families Act 2014 (c. 6), s. 139(6), Sch. 7 para. 28(2)(a); S.I. 2014/1640, art. 7(l) (with art. 16)
F9
S. 165(1)(b)(iv) repealed (5.4.2015) by Children and Families Act 2014 (c. 6), s. 139(6), Sch. 7 para. 28(2)(b); S.I. 2014/1640, art. 7(l) (with art. 16)
F10
Word in s. 165(1)(b) omitted (18.1.2020) by virtue of Parental Bereavement (Leave and Pay) Act 2018 (c. 24), s. 2(2), Sch. para. 19(2)(a); S.I. 2020/45, reg. 2
F11
S. 165(1)(b)(vi) and preceding word inserted (1.12.2014) by Children and Families Act 2014 (c. 6), s. 139(6), Sch. 7 para. 28(2)(c); S.I. 2014/1640, art. 5(2)(j)
F12
S. 165(1)(b)(vii) and preceding word inserted (18.1.2020) by Parental Bereavement (Leave and Pay) Act 2018 (c. 24), s. 2(2), Sch. para. 19(2)(b); S.I. 2020/45, reg. 2
F13
Word in s. 165(1)(b)(vi) omitted (17.1.2025) by virtue of Neonatal Care (Leave and Pay) Act 2023 (c. 20), s. 3(3), Sch. para. 19(2)(a); S.I. 2025/41, reg. 2
F14
S. 165(1)(b)(viii) and word inserted (17.1.2025) by Neonatal Care (Leave and Pay) Act 2023 (c. 20), s. 3(3), Sch. para. 19(2)(b); S.I. 2025/41, reg. 2
F15
Words in s. 165(2) substituted (25.2.1999 for specified purposes, 1.4.1999 in so far as not already in force) by Social Security Contributions (Transfer of Functions, etc.) Act 1999 (c. 2), s. 28(2)(a), Sch. 1 para. 30(3); S.I. 1999/527, art. 2(b), Sch. 2
F16
S. 165(2A) inserted (25.2.1999 for specified purposes, 1.4.1999 in so far as not already in force) by Social Security Contributions (Transfer of Functions, etc.) Act 1999 (c. 2), s. 28(2)(a), Sch. 1 para. 30(4); S.I. 1999/527, art. 2(b), Sch. 2
F17
Words in s. 165(3)(a) substituted (25.2.1999 for specified purposes, 1.4.1999 in so far as not already in force) by Social Security Contributions (Transfer of Functions, etc.) Act 1999 (c. 2), s. 28(2)(a), Sch. 1 para. 30(5) (with Sch. 8); S.I. 1999/527, art. 2(b), Sch. 2
F18
Words in s. 165(4) substituted (1.4.1999) by Social Security Contributions (Transfer of Functions, etc.) Act 1999 (c. 2), s. 28(3), Sch. 3 para. 54(3); S.I. 1999/527, art. 2(b), Sch. 2
F19
S. 165(5)(6) substituted for s. 165(5) (25.2.1999 for specified purposes, 1.4.1999 in so far as not already in force) by Social Security Contributions (Transfer of Functions, etc.) Act 1999 (c. 2), s. 28(2)(a), Sch. 1 para. 30(6); S.I. 1999/527, art. 2(b), Sch. 2
F20
Words in s. 165(5)(a) inserted (8.12.2002) by Employment Act 2002 (c. 22), ss. 6(2)(b), 55(2); S.I. 2002/2866, art. 2(2), Sch. 1 Pt. 2
F21
Words in s. 165(5)(a) substituted (12.2.2015) by National Insurance Contributions Act 2015 (c. 5), s. 7(1)(a)
F22
Words in s. 165(5)(b) inserted (1.12.2000) by Welfare Reform and Pensions Act 1999 (c. 30), s. 89(1), Sch. 12 para. 27; S.I. 2000/1047, art. 2(2)(d), Sch. Pt. IV
F23
S. 165(5A) inserted (2.7.2002 for specified purposes, 6.10.2003 in so far as not already in force) by State Pension Credit Act 2002 (c. 16), s. 22(3), Sch. 2 para. 18(2); S.I. 2002/1691, art. 2(l); S.I. 2003/1766, art. 2(a)
F24
S. 165(5B) inserted (12.2.2015) by National Insurance Contributions Act 2015 (c. 5), s. 7(1)(b)
F25
Words in s. 165(5B)(a) substituted (18.1.2020) by Parental Bereavement (Leave and Pay) Act 2018 (c. 24), s. 2(2), Sch. para. 19(3); S.I. 2020/45, reg. 2
F26
Words in s. 165(5B)(a) substituted (17.1.2025) by Neonatal Care (Leave and Pay) Act 2023 (c. 20), s. 3(3), Sch. para. 19(3); S.I. 2025/41, reg. 2
F27
Words in s. 165(6)(a) substituted (27.10.2008) by Welfare Reform Act 2007 (c. 5), s. 70(2), Sch. 3 para. 10(26); S.I. 2008/787, art. 2(4)(f)
F28
Words in s. 165(6)(a) substituted (29.4.2013) by Welfare Reform Act 2012 (c. 5), s. 150(3), Sch. 2 para. 25(3); S.I. 2013/983, art. 3(1)(b)(ii)