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What the self-employed need from a Rishi Sunak government
- 27 Oct 2022
After weeks of turmoil in Westminster, Rishi Sunak’s appointment as Prime Minister provides an opportunity for the return of some political and economic stability (which would be good news for everybody). But many solo business owners may take some convincing that a government led by the former Chancellor is in their corner.
Freelancers are searching for a political home
With a general election now on the horizon, political parties will need to fight for every vote in what is likely to be a very closely contested election. The Conservatives, as the self-proclaimed party of business, might count on the support of the self-employed. But as Chancellor, Rishi Sunak oversaw policy decisions that were detrimental to swathes of people who work for themselves.
Hundreds of thousands of company directors, and many other pockets of the self-employed sector, were not adequately catered for in pandemic support schemes, forcing many to close their businesses and others to turn to borrowing to get by.
And the extension of IR35 reforms to the private sector in 2021 continues to hammer contractor earnings, forcing thousands into unregulated umbrella companies and convincing others to take their services abroad or retire early, exacerbating the ongoing labour shortage.
The result is that before his tenure even began, the new PM’s relationship with large cohorts of the self-employed – many of whom one would expect to be natural Conservatives – has been fractured. If other parties bring forward clear, attractive manifesto offers for the self-employed, retaining their support could prove difficult for the Conservatives.
Supporting the self-employed
Winning back the support of the self-employed is possible, but to do so the Prime Minister will need to bring forward a suite of policies catered to the needs of the self-employed – from clamping down on late paying clients, improving freelancers’ access to key financial products, regulating umbrella companies, and of course, serious reform of IR35 legislation.
Having overseen the rollout of the off-payroll reforms to the private sector just last year, the PM (and indeed the new Chancellor, who recently saved the reforms from the scrapheap) may be reluctant to consider further changes to the rules in the short term.
But government’s acknowledgement of the disruption these reforms have caused – by a former Chancellor no less – leaves a crack that the new office holders will struggle to paper over.
IPSE will be writing to the new Prime Minister and other members of the cabinet over the coming days, to impress upon them the need to bring forward new, targeted measures for the self-employed, if they are to reassure them that this government supports those who take on the risk of working for themselves.
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