Covid-19: Support for the Self-employed

Baroness Thornhill Excerpts

Tuesday 24th March 2020 Lords Chamber

[The Earl of Courtown]

I thank the noble Lord, Lord McNicol. I am in total agreement that these things must be advanced as soon as possible. As I said in the Statement, my right honourable friend the Chancellor will provide a further update on support for the self-employed in the coming days.

The noble Lord mentioned other countries. As he will be aware, the situation has unfolded in different countries around the world at different paces. Her Majesty’s Treasury is keeping a close watch on what is happening elsewhere in Europe and in other countries. We will keep all these matters under review.

[Baroness Thornhill (LD)]

My Lords, I am sure we can all imagine the households up and down the country of the 5 million self-employed and freelance workers as they watched the Prime Minister’s statement and the penny dropped. You can imagine the scene: a builder talking to his wife, a freelance speech therapist in a school, and saying an expletive beginning with “S” and then, “This means we’ll have no money coming in for the foreseeable future.” That is what we need to consider. These people will have no access to funds.

Can the Government confirm that the support package mentioned by the noble Earl—much of what he said was about business in general, not the self-employed in particular—will be equal in generosity to that already provided to business and employees? Likewise, will the Government agree to the self-employed having the same access to zero-interest loans as other people for the next 12 months? They are not second-class workers. Perhaps more radically, will they consider a form of statutory self-employment pay, as the noble Lord mentioned, based on previous tax returns? That would seem the ideal safety net for those who will need it during the course of this pandemic.

[The Earl of Courtown]

I thank the noble Baroness, Lady Thornhill, for her question. Her Majesty’s Government are looking at all options for how we take this forward. Specifically for freelancers and the self-employed, at the moment we are doing it through the welfare system, which will benefit from changes made on 20 March, such as the £20 increase in the UC standard allowance and the uprating of local housing allowance. We are also temporarily relaxing the minimum income floor for all self-employed UC claimants for the duration of the outbreak. This means that a drop in earnings due to sickness or self-isolation, or as a result of the economic impact of the outbreak, will be reflected in claimants’ awards. Self-employed people unable to work because they are directly affected by Covid-19 or self-isolation will also be eligible for contributory employment and support allowance, as announced in the Budget; that is now payable from the first day of sickness. This package will enable self-employed people to claim welfare close to statutory sick pay.

The noble Baroness mentioned another issue, to which I do not have the answer. I will arrange for her to be written to on that.