Tag Archives: self-employed

Coronavirus: Tories threaten tax increase on self-employed after non-offer of help

Rishi Sunak: his promises are worthless – but you can bet he’ll follow through on his threats.

Typical Tories: they make a long list of promises that get broken within a week and then try to charge us a fortune for them.

So, with the self-employed, they’ve offered to pay 80 per cent of normal profits (not wages, as with employees).

But they won’t even start providing this until some time in June.

And self-employed people will be taxed for receiving that money.

And in the meantime, they want any of us whose income stream dries up to claim Universal Credit, joining an online/telephone queue of tens of thousands, as the Department for Work and Pensions is completely unable to cope.

This is the (bad) deal that Chancellor Rishi Sunak has offered – to 85 per cent of self-employed people.

And now, days later, he’s telling us he’ll increase National Insurance paid by all self-employed people because he says this excuse for a bailout makes it impossible to justify them paying less than others.

It’s a con.

Chances are that self-employed people won’t get anything – or will receive next-to-nothing; certainly not enough to cover their outgoings.

And they will be made to pay many times more than they receive in the years to come.

That is what’s “harder to justify”.

We don’t have a government – we have a gang of thieves. And they are using an epidemic to justify their daylight robbery.

Source: Coronavirus: Chancellor warns self-employed they face tax hike after crisis – Mirror Online

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Chancellor’s ‘jam tomorrow’ package for the self-employed is worse than useless now

Rishi Sunak: still discriminating against the self-employed? Why not just bring in Universal Basic Income? Then we can all relax.

How kind of Rishi Sunak to announce aid for self-employed workers who are likely to lose money because of the coronavirus crisis – except he didn’t did he?

He made a vague promise that we (This Writer is self-employed) might be able to get a grant of up to 80 per cent of our profits, which is taxable, up to a maximum of £2,500 per month – but not until at least the beginning of June, more than two months from now.

Oh, but we can claim Universal Credit in the meantime – except we can’t, because thousands upon thousands of people are queuing online and on the phone and the Department for Work and Pensions simply can’t cope with the deluge. We will lose valuable time just trying to announce that we want to claim, and even more in the processing of that claim.

Employees of companies who signed up to the government’s scheme for them can get their money straight away. Why not the self-employed?

Is this some back-handed attack on people who actually contribute to the economy on their own initiative?

Here’s a visual representation of the way Sunak and the Tories expect us to live:

It has already attracted flack.

Shadow Chancellor John McDonnell said the delay was unacceptable: “If people cannot get access to the scheme until June it will simply be too late for millions. People need support in the coming days and fortnight. Asking people to rely on Universal Credit when more than 130,000 people are queuing online will be worrying to many people, so there is a real risk that without support until June the self-employed will feel they have to keep working, putting their own and others’ health at risk.”

Stephen Timms, chair of the Commons Work and Pensions Committee, pointed out that a wait until June simply isn’t practical: “Few will have enough in the bank to tide them over until then, so they’ll have to rely on Universal Credit in the meantime. The Committee heard yesterday that that system is already buckling under the pressure of half a million new claims. The Government must now do all it can to shore it up, so people get the money they need, and quickly. And the Advance, payable up-front to those who need it, should be made non-repayable.”

Sunak said devising a scheme had been “difficult” and it would be “operationally complicated” – but this has attracted no sympathy from anybody who knows anything at all about it.

It’s the biggest advert for implementing a Universal Basic Income scheme – in which everybody will receive enough money to support them, regardless of their circumstances – that the public could be shown.

Sunak and the other Tories have squirmed and dissembled and eventually brought forward scheme after scheme that is incredibly complicated – which means they are likely to go wrong, to the detriment of the people they are supposed to be helping.

UBI is simplicity itself – and has a lot of support:

UBI – it’s simple, it’s popular, and it’s immediate. But Sunak wants to bring in something complicated, slow (if it actually happens at all) and discriminatory. Why not get in touch with him and tell him which you would prefer?

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DWP is swamped by half a million Universal Credit claims in coronavirus crisis

Another back-of-a-fag-packet Tory scheme falls apart.

Boris Johnson told us that Universal Credit would be available to self-employed people who become out-of-pocket as a result of his coronavirus lockdown. It’s a con, because they will receive just £94 per week, whereas employees whose firms sign up to the government’s wage guarantee will receive 80 per cent of their normal pay, up to £2,500 per month.

That’s a big difference – but the wage guarantee isn’t all it’s cracked up to be either; think what happens in firms that don’t sign up to it.

What a shame he didn’t find out whether the Department for Work and Pensions could cope with the extra load first.

And how strange that senior DWP official were reportedly sent to Job Centres, when the Job Centres are closed to appointments and assessments.

So what do you think has happened?

According to Work and Pensions Secretary Therese Coffey, the department has processed almost half a million claims in nine days.

And what do you think that means for the average claimant?

Here’s one now:

“Been trying to apply for Universal Credit and get my £95pw,” he writes.

“I started 4 hours ago.

“The number of people ahead of me in the queue has fallen by roughly 1,000.

“At this rate it will take 16,230.8 days to get to the front of the queue.

“Isn’t it great being self-employed?”

This story suggests Ms Coffey has been overoptimistic about the speed with which her people are processing claims.

I find the deadpan of the DWP computer system unintentially comical: “Number of users in queue ahead of you: 97,385.

“Your estimated wait time is: more than an hour.”

And of course people contacting the DWP about their continuing claims have been caught up in the delays.

A commenter to This Site told me they needed to contact the DWP before March 21 to meet a Universal Credit deadline – but was unable to do so because of the delays.

So the DWP sent a message saying the benefit had been stopped.

Fortunately it was possible to reinstate the payments in this case.

But the message is clear:

This was another promise Boris Johnson simply couldn’t keep. He is a menace to the public.

Source: Almost 500,000 people in UK apply for universal credit in nine days | World news | The Guardian

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By discriminating against the self-employed, Sunak is risking coronavirus spread

Rishi Sunak: Why is he discriminating against the self-employed?

Tory Chancellor Rishi Sunak is under pressure to stop discriminating against people who are self-employed – because he putting them at risk of spreading the coronavirus.

Sunak has announced a generous deal for employees who are ‘furloughed’ – kept in employment but unable to work because of the disease-related lockdown – of 80 per cent of their wages, up to £2,500 per month.

Self-employed people get just £94.25 a week in Universal Credit – if they can navigate the “byzantine” application procedure. And they’ll have the same if they have to claim Employment and Support Allowance after contracting the virus.

Only 16 per cent of workers accept that this amount would meet their basic needs.

It is claimed Sunak is risking public health by discriminating against the self-employed in this way, because he is incentivising self-employed taxi-drivers, couriers, other gig economy workers and zero-hours contractors to keep working while ill.

Solicitors Leigh Day were to send a pre-action letter to the government on March 23, on behalf of the Independent Workers of Great Britain union, ahead of issuing proceedings for a High Court judicial review.

The Tories say it is “operationally very difficult” to put in place a scheme for the self-employed, similar to that for employees.

But the Association of Independent Professionals and the Self-Employed (IPSE) says it could be assessed and delivered through the self-assessment tax system that millions of self-employed workers already use.

One thing is certain: the longer this drags on, the more self-employed people will be at risk.

And the more self-employed people come under threat, the more likely it will seem that this is the Tories’ intention.

Source: Rishi Sunak under pressure to bail out self-employed | Politics | The Guardian

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Mother forced to rely on food banks because of DWP rule that denies reality

Have you ever heard of the minimum income floor calculation?

If you aren’t on Universal Credit – and considered to be self-employed by the Department for Work and Pensions – then it’s most likely that you haven’t.

The premise is that, if a person is self-employed, they earn a specific amount of money per week, and Universal Credit is provided to them on that basis.

In the case of Roxy Theobald, of Long Stratton, Norfolk, this meant that she was assumed to be earning £822 per month, working 25 hours per week as a courier, from the time she started claiming UC in October 2018.

In fact, being able to work only the hours she was given, Ms Theobald earned much less.

This was of no interest to anybody at the DWP.

As a result, she had to visit food banks and rely on friends and neighbours giving her leftover food in order to keep herself and her daughter Bella alive.

She appealed against the DWP’s decision that it could use the minimum income floor to dock money from her claim, and a judge has ruled in her favour, saying he was not satisfied that she was in gainful self-employment.

Ms Theobald, now a full-time carer, has said she hopes her case will set a precedent, leading to a change of DWP policy.

That would be welcome, as there are undoubtedly many, many people – not just couriers, who are adversely affected by this rule.

It’s also possible that the arrival in cinemas of Ken Loach’s new film Sorry We Missed You, which explores the plight of couriers, may also focus the minds of the powerful on this matter.

Don’t hold your breath waiting, though.

Source: Norfolk mother left relying on food banks while working as courier wins Universal Credit tribunal | Latest Norfolk and Suffolk News | Eastern Daily Press

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Vox Political vindicated on unemployment figures

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How pleasant to see Vox Political‘s concerns about the massaging of UK unemployment figures being taken up by the kind of people the mass media actually respect.

A report on the BBC News website states that Conservative Party claims that unemployment has dropped by around 60 per cent in some areas is based on “wrong data” – in other words, the Tories are lying.

This blog has been saying that for a very long time!

The story says Tories have been using Jobseekers Allowance figures – the so-called Claimant Count – to justify their claims, but the independent Office for National Statistics showed only a 20 per cent drop in those seats. The ONS said online: “the number of unemployed people in the UK is substantially higher than the claimant count”.

Jonathan Portes, director of the National Institute of Economic and Social Research (and well-known to readers of this blog), said: “Many people who are unemployed don’t claim JSA… JSA figures at the local level are accurate, but it is not correct to confuse JSA rates and unemployment.”

In the BBC story, a Tory spokesman said the concern over the data was “nonsense”. He said: “This unemployment measure is provided by the independent House of Commons Library – and for constituencies they are the most up to date and most reliable numbers to use.”

Yes, the House of Commons Library does provide figures – with a caveat that they do not include the number of unemployed people claiming Universal Credit, and there is no date set for when those figures will be included in the Claimant Count (as reported by David Hencke in November last year). The current way of calculating these figures is misleading from the start.

In an article from the same month, This Writer made some other pertinent points:

“If employment has increased – and there’s no reason to say it hasn’t – we can also conclude that the reason employers are more willing to take people on is that they can pay peanuts for them and rely on the government to top them up with in-work benefits. It seems likely that the work was always there but employers weren’t going to take anybody on if it meant increasing the wages bill and reducing the amount of profit available to them. Now that zero-hours contracts are available, along with part-time schemes that deny people pensions and holiday pay, it’s a different matter.

“The number of people who were self-employed increased by a staggering 186,000, to reach 3.25 million, while people working as self-employed part-time increased by 93,000 to reach 1.27 million. That’s 4.52 million – almost one-sixth of the total number of people in work. If you think that’s great, you haven’t been paying attention. Remember this article, warning that the increase was due to older people staying in work? And what about the catastrophic collapse in self-employed earnings we discovered at the same time?

“How many of these are people who have been persuaded to claim tax credits as self-employed people, rather than jump through the increasingly-difficult hoops set out for them if they claimed Jobseekers’ Allowance – and do they know they’ll have to pay all the money back when their deception is discovered?

“The number of people in part-time employment has also increased, by 28,000 to reach 6.82 million. Are we to take it that this means under-employment has increased again?

“Public sector employment has fallen again. If you want to know why the government keeps messing you around, there’s your answer. There aren’t enough people to do the job. This month’s statistics show 11,000 fewer public sector employees than in March, and 282,000 fewer than this time last year.

“Unemployment is said to have dropped – but remember, this is not counting people who have been sanctioned. A recent study by Professor David Stuckler of Oxford University suggests as many as half a million people could have been sanctioned off-benefit in order to massage the figures, meaning that the total listed – 931,700 – is probably wrong. Remember also that Universal Credit claimants aren’t counted, nor are those on government work schemes – another 123,000 people.

“This means the actual unemployment rate is likely to be double the number provided by the official statistics.

“And what about people on ESA/DLA/PIP?”

In January this year, This Writer added: “New research by Oxford University and the London School of Hygiene & Tropical Medicine has shown that only around one-fifth (20 per cent) of people who have been sanctioned off of Jobseekers’ Allowance have actually found work, leaving 1.6 million in limbo; they’re off the benefits system but researchers can only surmise that they are relying on food banks.”

And in February, Vox Political had this point to make: “We also know that many thousands have died – through suicide or complications of their physical conditions (if claiming incapacity benefits) after receiving decisions that were not only wrong, but may have been fraudulent.”

Whichever way you slice it, the Tories aren’t being straight with you.

You can trust Vox Political to give you the facts, though.

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The UK’s main growth area continues to be SUICIDE

150220malesuicide

The Office for National Statistics has released the latest figures on suicide, which show that the proportion of people taking their own lives has grown faster than the UK economy.

The statistics cover the calendar year 2013, when the economy grew by 1.7 per cent – but suicides increased by more than double that amount – four per cent. This writer has seen unconfirmed estimates that suggest a rise of 12-13 per cent since the Coalition Government took office in 2010 – that’s up by one-eighth.

The male suicide rate in 2013 was the highest since 2001, at 19 per 100,000 members of the population. This was almost four times higher than the female rate (5.1 per 100,000), which has stayed constant.

As Vox Political reported back in 2012, suicide continues to be the most reliable indicator of the UK’s true economic activity: The highest suicide rate among the English regions was in North East England, at 13.8 deaths per 100,000 population, while London had the lowest at 7.9 per 100,000. The Northeast has been one of the areas hardest-hit by the banker-engineered recession and Tory-engineered cuts (if not the hardest-hit altogether); London has benefited the most from government investment.

And the highest suicide rate by broad age group was among men aged 45-59 (25.1 deaths per 100,000). This is the group least likely to return to work after losing a job. It is also the group containing the most self-employed people, after the dire state of the economy made it impractical for them to retire.

Some naysayers may try to point out that the number of suicides is very small – 6,233 during 2013. They should be asking themselves: In a country where the government and its mass media are continually telling us that everything is going swimmingly, why are any suicides taking place at all?

Is it perhaps because of the attitude shown to the less-fortunate – by, for example, people on David Cameron’s own Facebook page. When a commenter wrote that they were considering suicide after being wrongly sanctioned, the response – and remember, this is on the prime minister’s own Facebook page – was “Well get on with it, then.”

Poverty is rising, suicide is rising, and they tell you all is well in Cameron’s corrupt country.

He is to blame for this.

The sooner he and his cronies are gone, the better.

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On the international Day of Older People, more older people in the UK were having to stay in work

If there is a drawback to Second Reading (the House of Commons Library blog), it’s that the library’s stern practice of impartiality means that it can end up producing figures on a phenomenon without being able to explain why that phenomenon came about.

So it is with yesterday’s figures on ‘Older people in the UK labour market’ – which looks at key statistics regarding older people who are still in work.

First we get a graph showing that the number of people aged over 65 who are still in work has more than doubled, from 4.9 per cent in 1994 to 10.1 per cent (of 11 million people, making 1.1 million) in 2014.

141001-employment-rate

Before anybody leaps in to say they’re taking jobs away from younger people, it is worth reading on to discover that they are far more likely to be self-employed or working part-time (79 per cent of the total, with 39 per cent self-employed – 438,000 people).

That’s really as far as Second Reading can go. Fortunately we have Flip Chart Fairy Tales to provide more insight into the reasons. In an article posted on August 1 this year, this blog states:

Chris Giles wrote a piece in the FT this week arguing that most of the increase [in self-employment] is due not to lots more people becoming self-employed but to lots more people not leaving self-employment who would otherwise have done so.

If that’s the case, you can’t even blame the catastrophic collapse in self-employed earnings after 2008 on there being lots of new people who didn’t know what they were doing. If Chris is right, this is old-timers seeing their business shrink, rather than newbies trying to find their feet, under-charging and messing things up [all boldings mine].

The same goes for the increase in the number of self-employed tax credit claimants and the steady rise in non-employing and non-VAT paying businesses. If there has been no surge in new entrants, then either a lot of low profit and low turnover businesses are hanging on in there, or a lot more of them have become low-profit and low turnover businesses since 2008.

Chris says we should stop complaining because self-employment boosts tax revenues. It hasn’t done much boosting in recent years though. Despite the increase in numbers of people, the declared income of the self-employed was down by £8bn between 2008 and 2012.

What we’re seeing, then, is a huge rise in the number of people who find themselves unable to retire because they won’t have enough income to support themselves.

It has been said that Conservatives try to look after the elderly, because they are the only population group that is sure to vote in elections.

It seems the Tories have forgotten around 1.1 million of them.

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The taxless recovery – Flip Chart Fairy Tales

This is no ordinary recovery, according to Flip Chart Fairy Tales. Not only has it taken a hell of a long time to do not very much, it’s seen collapsing productivity and very little wage growth, even for those who appear to be highly skilled. As a result of all this, even though the economy grew at over 3 percent, tax revenues didn’t increase at the same rate.

As Ben Chu’s chart shows, most of the rise in tax revenue since the recession is due to VAT.

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Record numbers of people in employment, it seems, hasn’t led to record levels of income tax.

When you break out the figures for income tax, as Michael O’Connor did earlier this week, there is a marked difference between receipts from those on PAYE and those on self-assessment.

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Falling self-assessment receipts are, for the most part, a symptom of falling self-employment incomes. Around three-quarters of the employment growth since the recession has come from self employment yet between them, the self-employed are still delivering a lot less tax. We won’t see the final 2013 HMRC figures for self-employment incomes until January but these charts suggest that the spectacular fall in self-employment earnings between 2008 and 2012 hasn’t improved by much. Probably the closest estimate we have for self-employed pay since 2012 is by Laura Gardiner at the Resolution Foundation. The low tax receipts indicate that self-employed earnings may have continued to fall or are, at best, stagnating.

Screen Shot 2014-07-10 at 16.43.58

Things might be about to get worse for some of the self-employed. As Ben Dellot explains, the new Universal Credit system could leave many of them worse off. According to the RSA’s calculations, 37 percent of the self-employed earn less than the minimum income floor, which is set at around the full-time minimum wage. (That sounds about right. A study by the IFS found that 40 percent of the self-employed earn less than the minimum wage.) Not all the self-employed currently claim tax credits but those who do, and who fall below the income floor under the new system, will find their benefits cut. The self-employed now account for almost a fifth of tax credit claimants so this is likely to affect a lot of people.

Read the rest of the article on Flip Chart Fairy Tales.

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Ed Miliband’s policies backed by public – The Guardian

Here’s some information that will enrage everybody who has been campaigning so ardently for the downfall of the Labour Party – people who have been duped by Lynton Crosby and (north of the border) the SNP. The Guardian has revealed the following:

Over 70 per cent of the public are in favour of Miliband’s policy to fund the NHS with extra taxes on tobacco companies and mansions, according to a new poll.

Every one of Ed Miliband’s pledges from his speech yesterday has popular public support.

A new Survation poll for Labour List of 1,037 people shows that 72% of the public are in favour of the policy to fund the NHS to the tune of £2.5bn extra a year, partially using taxes against tobacco companies and mansions as well as closing loopholes. Only 12% were against.

The polling suggests this pledge was particularly popular among Labour (81%) and Lib Dem (84%) voters from 2010, which is useful for a leader hoping to woo disaffected voters from Nick Clegg’s party.

[Image: The Guardian.]

[Image: The Guardian.]

Miliband’s pledge to raise the minimum wage to £8 an hour also was supported by the majority of the public and played even better with Liberal Democrat voters (80.1%) than Labour (78.6%).

His pledge to break up the high street banks was the least popular (but still had 43.9% of people in favour of it). Only a quarter of people (24.9%) said they were opposed to it with 31.4% saying they didn’t know how they felt.

In fairness, the article adds: The way this poll is structured may be flattering to Labour’s prospects. By using Labour’s own phrasing, the poll presents each policy in quite a generous light, which makes it difficult to disagree with – not many people would say creating “a “world class” health service” is a bad idea, for example. This has the effect of making the policies look popular – and they may well be – but it may be that if the same policies were presented differently, the poll numbers could change a lot.

Nevertheless, this is exactly the response Labour needed, in advance of next year’s general election. Clearly the general public thinks that Ed Miliband is on the right track.

Of course, the election is still eight months away and much may change in that time. Public opinion is fickle and we may well see polls supporting David Cameron’s plans – or even Nick Clegg’s – before the end of October.

But it’s a big boost for Labour and will give the party the momentum it needs, in order to win the campaign and – if elected – let us hope Miliband will hit the ground running.

Because the UK needs a change, and it can’t come soon enough.

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