Inquiry into the future of self-employment

Since the start of this pandemic, the plight of self-employed and freelance workers has been one of the top priorities for Prospect.

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We know that this has still been an incredibly tough time to be self-employed and that the government have not done anything like enough to help.

We need action, which is why Prospect have launched a new Inquiry into the future of self-employment, alongside Community union.

The Inquiry is the first step in the next phase of our campaign for freelancers and the self-employed.

It brings together unions, politicians, policy experts and more to find some solutions to the big challenges we face, like how to provide a proper safety net for the self-employed, how to make sure government understands self-employment, and how to make sure the benefits self-employed people receive are fair compared to their taxes.

Interim Report

At the end of 2020 the Inquiry released a Interim Report, based on the survey of self-employed and freelance workers undertaken in the final months of the year.

The key findings of the Interim Report are:

  • Over 50% of self employed workers had lost 60-100% of their household income in 2020
  • 64% were less likely or unsure if they wanted to continue to be self employed in the future
  • 73% had been unable to access DWP support such as Universal Credit
  • 88% did not believe that support for the self employed in the pandemic had been commensurate with their tax contribution

In response the Inquiry has called for the immediate introduction of a Self Employment Stabilisation Scheme (SASS) to complement and build on the existing Self Employment Income Support Scheme (SEISS).

The SASS would close existing gaps in the SEISS scheme, such as for company directors, the newly self-employed those who are caught by the cliff-edge thresholds in the SEISS scheme. In addition the SASS would introduce sectoral funds in areas with large freelance workforces, such as the creative industries, to support these workers and halt a flow of vital skills out of these sectors.

The Inquiry argues that this additional support is necessary to enable a swift economic recovery in 2021, and that failure to offer this support with cause long-term economic damage by destroying small businesses and driving people out of self-employment. With the vaccine offering hope of a return to normality quickly, the cost of a few months of extra support must be weighed against the likely damage caused if no action is taken.

Prospect general secretary Mike Clancy, who commissioned the Inquiry, said:

“The news that barely a third of all self-employed and freelance workers are confident they want to continue to work in this way should be a massive wake-up call to the government.

“These workers have powered our economy in recent years and this flexible workforce were lauded by ministers as key to our prosperity. But the way they have been treated in this pandemic is disgraceful and will have consequences for our ability to recover in 2021 in beyond.

“In the long term we need fundamental changes in how these workers are treated. For now, the government has to listen immediately to this Inquiry and introduce a scheme to halt the stampede away from self-employment that that their policies is causing.”

Note: These are interim recommendations and do not necessarily reflect the views of every member of the commission.

Read the interim report Download now