CEO update November: Important wins on Universal Credit and IR35 in one of our busiest months

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For IPSE, the second lockdown coincided with one of our busiest months of the year. And so, just as we found ourselves once more locked in our homes, we were also working harder than ever to champion the self-employed in these difficult times. I’m also glad to say that this led to some important wins – on Universal Credit and IR35 (which I explained in a post earlier this month).

Through November, we have also been working to provide more and better support than ever with My Money, our month of free financial guidance webinars – covering everything from new support guidelines to protecting your business from cybercrime.

A hard winter for the self-employed

We may have had wins for the cause, but there’s no denying the self-employed face a hard winter. At the start of the month, with many regions slipping into higher tiers and a new lockdown looming, the government finally extended SEISS through the winter. As we raised across the media, however, the government continues to exclude 1.5 million self-employed from this vital support.

We saw the consequences of this failure this month, too, as labour market statistics showed the number of self-employed continues to decline. The number of self-employed in the UK has now dropped from 5.1 million at the end of 2019 to 4.56 million, wiping out the growth of the last 5 years. These excluded freelancers are being pushed both into PAYE work or even into the benefits system.

We shed light on this with shocking research published in the Times, the Independent and elsewhere that the number of self-employed on Universal Credit has risen by 341 per cent since the start of the pandemic.

There are other drastic, long-term financial consequences for many freelancers too. Research we conducted with Starling – which was published in the Times and the Telegraph – found that 1.05 million self-employed have been forced into debt by the pandemic and 1.23 million have burned through their savings to get by.

We are acutely aware of the financial struggles of our members and all the self-employed community, and we will continue to press hard both to raise awareness about this awful situation and to shame the government into finally resolving it. 

My Money: financial guidance in tough times

We are lobbying on policy solutions to support hard-hit freelancers, but we also doing what we can directly. To that end, in November we ran My Money, a month of free financial guidance aimed just at freelancers.

My Money is an annual event for us, to help a sector that was already financially volatile for many even before the pandemic. In this deeply unusual and unsettling situation, however, we saw there was even more of a need for freelancer financial guidance and support. Therefore, we stepped up the event series, running at least two webinars each week, with a particular focus on urgent support and guidance during the pandemic.

I’m glad to say all our My Money events were very well attended – and if you’re a member you can listen back to all of them now in our Webinar Library.

Hard graft and policy wins

As we enter this hard winter, it’s true we have not got everything we want from government. But in my experience, lobbying is not about quick wins: it is about hard graft and the long-term, and we are making progress. This month, we pushed the government into extending the Minimum Income Floor (MIF) for Universal Credit, which means tens of thousands of self-employed who haven’t been able to access other support will still be able to claim this vital benefit. It’s not everything we want, but it’s an important start.

Then, as I wrote to you earlier in the month, we have also made some inroads with IR35. As our Policy Director Andy Chamberlain explained in a blog, there is a very serious flaw in the wording of the IR35 legislation, which could lead to enormous problems for umbrella companies, agencies and contractors themselves.

HMRC claimed they were resolving this, but we noticed that in the statutory instrument going through Parliament, the wording is the same. Now, working with Lord Forsyth, we have brought about a debate on it in the House of Lords. It’s not ground-breaking, but it’s something and, what’s more, it shows that when we press the case for the self-employed, government and politicians are listening.

In fact, one of the most heartening things we have seen in recent months is that, at every turn – on IR35, on forgotten freelancers – the government is faced by MPs and Lords who are pushing our case. This week, the Chancellor could not get through his Spending Review without MP after MP quizzing him on the gaps in support. We have had valuable wins this month but, most of all, we know now that when we champion you and the rest of the self-employed, our messages are getting through and being taken up by politicians at every level.

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IPSE is the leading association for contractors, consultants, interims, freelancers and the self-employed. We strive to bring our members the most comprehensive and useful range of information and services and all the latest news about what affects your business.
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Derek Cribb