Chancellor lobbied to extend income protection for self employed

MPs and business groups have called for the extension of the UK government’s support scheme for the self-employed.

More than 100 MPs have signed a letter to Chancellor Rishi Sunak saying: “This scheme is a lifeline for millions of locked-down workers right across the country. There are already significant holes in the support, but removing what is already in place would pull the safety net from under the feet of millions of self-employed workers . . . How can it be right for the furloughed scheme to continue but this scheme to not?”

The Association of Independent Professionals and the Self-Employed [IPSE] has also sent a letter to Sunak, warning that people fear a financial cliff edge if the scheme is not extended.

It says: “We recognise that the scheme cannot run indefinitely and there needs to be a reasonable debate over how it will be unwound over time. However, we believe that given the employee Job Retention Scheme will now run until October 31 2020, a similar principle should be adopted for SEISS – it should also be extended. Now is not the time to withdraw vital support, particularly when so many of the sectors that contain a large self-employed workforce – from the creative industries to hospitality and leisure – are likely to be the last to reopen.”

The Federation of Small Businesses also expressed concern, noting that the likes of “hairdressers . . . event organisers, caterers and B&B owners” are unlikely to be able to resume work for many weeks.

The Self-Employment Income Support Scheme has so far provided £6.8bn to 2.3m people, and is due to end this weekend.

Meanwhile, Sunak is expected to announce a change in the furlough scheme for employed workers that could see employers required to pay a portion of the wages of their furloughed staff from August. The government currently pays 80% of wages for workers, but the Treasury is set to announce that employers will be required to put forward 20% of furloughed workers’ wages as of August – as well as covering their national insurance and pension contributions.

The move would mean furloughed staff receive the same amount while the government’s share of the burden is reduced. Reports suggest that the scheme will also be closed to new entrants from the end of June.

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