Lewlew, You're right that the NHS is funded from general taxation. NI is supposed to be allocated to a defined range of pensions and benefits. However, the way the Treasury works all the money goes into a big 'pot' and the link with how everything is funded is fuzzy. The government receives almost as much in NI contributions as it does in income tax. For years, it's been a government trick to keep down the income tax rates, because they make headlines, while the rate of NI has crept up. People never build up a personal 'pot' with NI and there is almost no link with what people pay over a lifetime and what they receive. I would be happy to have a system similar to Germany, where people pay into central bank-backed insurance schemes for illness, unemployment and pensions, related to means. Although they pay more, they receive more back. It would, of course, mean that people would pay for illness cover throughout their lives, not just when they're working.