Self-employment Income Support Scheme

Lord Empey Excerpts

Tuesday 5th May 2020 Lords Chamber

[Lord Callanan]

I apologise to the noble Baroness; she was breaking up so I did not quite catch all of her question. However, I think she was talking about the creative industries. Work in these industries is treated in the same way for universal credit as all other forms of self-employed work. We are aware that many who are self-employed—particularly those whose earnings are seasonal and often fluctuate from month to month—need to budget and plan for this; universal credit takes account of that by varying its payments from month to month.

[Lord Empey (UUP)]

My noble friend the Minister will be aware of people moving from PAYE employment, perhaps to start a new business or to become self-employed. These people have become caught between two stools. Does the Minister realise that the thresholds for universal credit mean that savings that people may have accumulated to start their new business will in large measure have to be spent before they can qualify for universal credit? Will he be prepared to review the threshold operation in these unique circumstances?

[Lord Callanan]

I understand the point that my noble friend is making, but a key principle is that universal credit should go only to people who do not have assets available to meet their basic needs. It is important to protect the incentive to save. However, any assets used wholly or mainly for the purpose of a claimant’s trade or profession are disregarded indefinitely while the business is still operating. Any money that may be in their account to be used for business purposes will also not be counted towards the capital allowance.