More than 1,000,000 self-employed people left out of any government help again
More than 1 million people will have to fend for themselves after the Chancellor failed to plug holes in his support for the unemployed, a trade body has warned.
In Parliament today Rishi Sunak unveiled a winter rescue plan for the economy, bringing an end to the furlough scheme and replacing it with a Job Support Scheme, topping-up wages of employees on shorter hours than usual.
When the Government announced an unprecedented economic intervention in March, vowing to cover 80% of at-risk workers’ wages to a maximum of £2,500 per month, self-employed people across the country felt left behind.
The self-employment income support scheme (SEISS) was launched in May, covering 80% of average profits in the form of a one off grant capped at £7,500 and then at £6,570 from July.
As the Treasury tries to gradually wind down its support while more businesses are able to operate, it has now said it will cover just 20% of self-employed people’s earnings.
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Sunak also promised to defer income tax self-assessment, a measure that will be ‘of particular importance’ to people who work for themselves.
But the help misses out around 1.5 million people who have been given far too little support through the crisis, said director of policy at the Association of Independent Professionals and the Self-Employed (IPSE) Andy Chamberlain.
He added: ‘Although it is right for the Chancellor to extend Seiss, the support announced today still excludes one in three self-employed people.
‘Limited company freelancers and the newly self-employed almost entirely missed out on support in the last lockdown and have faced bleak months of financial devastation.
‘Now they face a dark winter ahead unless the government does more for them.’
He added that the 20% cap on support is likely to prove insufficient for many.
These concerns were echoed by MPs after the Chancellor made his statement in the House of Commons.
Head of the influential Treasury Select Committee Mel Stride welcomed the latest measures, but said many self-employed workers had fallen through the gaps the first time around.
He asked Sunak to say whether the new measures will improve or iron out these problems, but the Chancellor did not give an answer.
Instead he said: ‘With regard to the self-employed, I’m glad he welcomes the extension and the existing support grant.
‘This is something that virtually no other country in the world has done, and it comes on top of the most generous support to our self employed out of almost any country throughout their response to this crisis.
‘Of course I will be happy to meet with him, but I know he will also be pleased to learn that the measures today to defer income tax self assessment will be of particular importance to our self employed small businesses.’
When questioned at a Downing Street press conference this afternoon, Sunak said ‘95% of people who are majority self-employed have received support’.
He said in the past the Treasury hasn’t been able to support people ‘who we don’t know about because they haven’t filed a tax return’.
But many freelancers who have paid tax through PAYE contracts say they still received no or very little support.
Already self-employed people have been emailing their MPs calling on them to raise the maximum amount of income support provided.
Musician and producer Simon Goulding tweeted: ‘Do YOU think 20% is fair?? Honestly?? How are we supposed to live?’
Sharing a link inviting people to send an email to their MPs, actor Thomas Coombes said: ‘If self employed & feel shafted.. Or just feel for the shafted self employed.. Give a sign, ta!’
Singer and songwriter Eliza Lawson added: ‘Are you f*****g kidding?! 20% is an absolute complete and utter p**stake.
‘The amount of tax and revenue generated by the untold amounts of self employed professionals is worth more to our economy than this. Absolute s**t show.’
The chief executive of the Creative Industries Federation warned many self-employed workers may still ‘fall through the gaps in Government support’.
Caroline Norbury said: ‘We welcome the emergency measures announced by the Chancellor today, which will support many organisations, workers and freelancers in our sector that are still unable to operate at full capacity due to the pandemic.
‘However, the eligibility criteria of the Self Employment Income Support Scheme remains unchanged, which means that many of the sector’s two million self-employed workers – including limited company contractors, PAYE freelancers and the newly self-employed – will continue to fall through the gaps in Government support.
‘Many of these people have seen all of their work dry up overnight and it remains vital that they are supported as a matter of urgency.’
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