The headlines might say there was a £500m boost and more protection for self-employed workers hit by coronavirus in today’s Budget but look underneath and there’s little to crow about.
The Budget stopped short of meeting demands to extend statutory sick pay to all, including the self-employed, which Community was calling for. The self-employed can apply for other benefits to cover any sickness and it’s the changes in this area that have contributed to the headline numbers.
There was a welcome lift on the requirements to the minimum income floor (MIF) for Universal Credit, which Community had highlighted as a problem some time ago. If you are gainfully self-employed and your business has been running for more than 12 months, the MIF applies. The major problem with the MIF is that it does not account for fluctuating incomes for the self-employed, and tends to penalise workers with low income who if they earn less than the MIF they will not be offered more money to top up their losses.
Another one of the new measures is that there be quicker payments for Employment Support Allowance, which will now be payable from day one. This is another step in the right direction but it’s disappointing that it’s taken a pandemic to bring about some much-needed change. All the changes proposed today should be maintained beyond the immediate threat of coronavirus.
In the end, easier access to benefits is not the answer for the low paid self-employed because Universal Credit could take up to 5 weeks before payment, especially with increased demand. Most self-employed workers cannot afford to wait and so will have to choose between paying their bills or their health (and the health of others).
There is still a need to review how government policy and support works and provides protection for self-employed workers.
This isn’t just around the government’s approach to benefits. There was no mention of IR35 during the announcement and the issues surrounding the tax reforms needed for the self-employed, which are an ongoing concern that affects so many.
The statutory sick pay changes do not go far enough for other low paid workers either, because the current level of just £94.25 is simply not enough to live on.
This is especially true for social care workers – one of the most vulnerable sectors, where there is no plan to support those who will be impacted by coronavirus in need of care and working in the sector. The fact that there was no mention of social care in today’s Budget is also of great concern for a system already in crisis.
Low paid workers, including the self-employed and those in the care sector, have been let down by the government in today’s Budget and in their response to supporting workers who will be impacted by COVID-19.
All workers need better support from the government and from our benefits system. Without fair treatment for all workers then too many people will continue to struggle to make ends meet and support their families.
Community will continue to make the case for a better working world for our members.
Kate Dearden is Community’s Head of Research, Policy & External Relations