Government told of eight ways to boost the flagging self-employed

An emergency life raft of 'freelance-friendly' measures is being called for to minimise what has already become a significant slump in the confidence of sole traders.

In fact, at least eight proposals to shore up the position of self-employed people have been urgently tabled to the government by the Federation of Small Businesses (FSB).

And the federation says it is a position which is flagging. According to its index, the confidence of the self-employed fell to +2.8 between April and June 2018.

That represents a substantial drop from the two-year high of +9.7, recorded by the FSB a little over a year ago, and based on its quarterly polling of more than 1,000 people who are their own boss.

In practical, everyday terms, the currently low confidence reading equates to almost a third of sole traders forecasting that their business performance will worsen over the coming three months.

Although marginally more believe that their business performance will improve (31%), more than four in ten say they are not expecting a "meaningful" improvement.

So eight emergency measures designed to 'arrest the collapse in self-employed confidence across the UK' should be taken, the federation said. The eight are:

1.    Introduce two weeks of statutory paternity pay and an Adoption Allowance for the self-employed; and make amends to the Parental Bereavement Bill to ensure sole traders are included in the potential legislation
2.    Reform Universal Credit (UC) to protect sole traders from losing out due to fluctuating incomes; and extend the UC ‘start-up period’ to ensure claimants have at least two years to get businesses 'off the ground.'
3.    Seal a Brexit deal that works for sole traders -- "one which allows them to cross European borders without administrative burdens and additional costs."
4.    Use the self-assessment process to nudge the self-employed towards saving more for the future; as FSB says only 17% of self-employed people have a private pension (compared to 78% of employees)
5.    Ensure that lessons are learned from the impact of changes to IR35 legislation in the public sector before rolling them out to the private sector
6.    Begin closer working between government and financial services firms to help the self-employed overcome barriers faced when applying for mortgages, loans and insurance products
7.    Introduce tax relief on training courses for the self-employed that provide them with new skills to ensure they can compete in a rapidly changing economy
8.    Provide Local Enterprise Partnerships with comprehensive information on the number of self-employed people in their area so they can target small business support effectively.

“The UK’s self-employed community contributes more than £270billion to the economy annually yet they’re still treated as an afterthought by policy makers," said FSB National Chairman Mike Cherry.

He added: “The self-employed need to be front of mind for Brexit negotiators. We must avoid a future scenario where our contractors have to fill out burdensome paperwork when completing jobs in Europe.

"The delays caused could well mean losing out to competitors already based in the EU. Any Free Trade Agreements struck after 2020 need to include dedicated small business chapters to ensure firms of all sizes, including sole traders, benefit from new arrangements.” The Flesch Reading Ease gives a text a score between 1 and 100, with 100 being the highest readability score. Scoring between 70 to 80 is equivalent to school grade level 8. How the Flesch Reading Ease Test can help to increase your Readability Score? This means text should be fairly easy for the average adult to read.

The federation will be spending the coming months lobbying the government to "change the status quo" for the self-employed, equipped with a 'Think Self-Employed' agenda (containing the eight proposals) to focus the minds of policymakers.


11th July 2018

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