A leading voice for self-employed workers has said the new support package, aimed at business owners with premises, “misses the mark” and will do little to mitigate the financial damage to self-employed workers as a result of the coronavirus pandemic.
The Association of Independent Professionals and the Self-Employed (IPSE) has urged the Government to work with business groups to plug the gaps in self-employed support and mitigate the “severe impact” of the new lockdown measures.
In growing calls to the Government both IPSE and the FSB (Federation of Small Businesses) has urged officials to provide urgent support to sole directors, the newly self-employed and others falling through the support gaps.
Derek Cribb, CEO of IPSE, said: “There’s no doubt the new lockdown measures will have a severe impact on the already struggling self-employed sector. The school closure is also likely to hit self-employed parents particularly hard, cutting into their working week.
“The new support package, aimed at businesses with premises, misses the mark and will do little to mitigate the financial damage to the self-employed sector. After almost a year, there are still drastic gaps in the support available to the self-employed, with over 1.5 million sole directors, newly self-employed people and others still excluded.
“We urge the government to work with business groups to plug these gaps and get support to freelancers in need over the coming months. We are keen to work with government to find a solution and make this right.”
Mike Cherry, FSB National Chair, said: "While this additional financial support will be a lifeline to 600,000 businesses and therefore has value, there is a need for a plan that matches the scale of the economic damage we are seeing.
"For many it just won't be enough for businesses who are already under the cosh and on the brink.
"These funds come after a disappointing festive period and are followed by a last minute lockdown and do not go far enough to match the scale of the crisis that small firms are facing.
"There remain too many groups who need more support to weather this storm such as the newly self-employed, those in supply chains and company directors. We continue to call on the government to create a Directors Income Support Scheme, mirroring the Self Employed Support Scheme (SEISS), in the form of a taxable grant for directors of limited companies calculated at 80% of three months average monthly trading profits, paid out in a single instalment and capped at £7,500.
"We also need to see the government make clear its plans for more finance capabilities made available to those who have used their allocations through Bounce Bank Loans as well as extending the period before repayments begin.
"This lockdown is expected to last for some time, even when restrictions ease, many small firms will be unable to function at 100 per cent, if at all. Which is why the government should create a Spring Economy Plan to help firms get through to drive a vaccine-enabled recovery.
"After clawing their way through 2020, the start of the new year looks set to be an even worse one for many. Small businesses are the backbone of our economy, and it is absolutely vital we support them in every way possible until the crisis finally begins to ease.”
Earlier this week, the Labour Party also called on the Chancellor Rishi Sunak to make an urgent statement to Parliament detailing the economic support for the new England-wide lockdown, including confirmation that the next Self Employed Income Support Scheme (SEISS) will be set at 80%.