The U.K. government has provided unprecedented financial support to millions, but the coronavirus support schemes were implemented at speed, and now is the time to support “those left behind,” a Labour member of Parliament has said.
On January 13 MPs approved a 10-minute rule motion allowing Tracy Brabin and a cross-party group of sponsors to bring forward a private members’ bill requiring the government to conduct “an assessment of any gaps in financial support provided to individuals, businesses, and industries over the course of the COVID-19 pandemic” and report to Parliament on the steps it intends to take regarding those gaps. Campaigners estimate that 3 million people have been excluded from the support schemes.
The COVID-19 Financial Assistance (Gaps in Support) Bill is set to receive its second reading in the House of Commons on January 29. Brabin told MPs that Chancellor of the Exchequer Rishi Sunak failed to acknowledge those excluded from support during his January 11 statement on the economy. That omission left Brabin and many others “bewildered, angry, and upset,” she said.
During a debate on that statement, Sunak indicated that HM Treasury will give “fair and due consideration” to a proposal to extend income support to company directors who have drawn some of their income from the company in the form of dividends. He suggested that any extension of the existing schemes would not be announced before the March 3 budget.
“The government must identify the gaps in support and inform this House of the steps it’s going to take to right this wrong without delay,” Brabin said. She went on to cite several examples of people excluded through no fault of their own from the coronavirus job retention scheme and the self-employment income support scheme. “There are millions of citizens reaching out for help, only to find — just by nature of how their tax is calculated — they are now left by the wayside,” she added.
The newly self-employed could be included in the fourth round of the self-employment income support scheme, Brabin suggested. Many directors of small and medium-size businesses were unable to furlough themselves “either because it would mean they weren’t allowed to do any work at all, or that they were ineligible,” she added.
The proposed directors' income support scheme “could help support company directors — [which is] really important because there will be no meaningful recovery from COVID if there aren’t any businesses left standing to employ people,” Brabin argued.
"The U.K. government is failing miserably to meet its responsibilities and deliver a financial package for the 3 million excluded who have been living without a single penny of support for 10 months now,” Alison Thewliss, Scottish National Party MP and a co-chair of the Gaps in Support All Party Parliamentary Group, said in a January 13 release.
The Scottish National Party “has repeatedly pressed for support for the self-employed — calling on the U.K. government to introduce a package of measures including using the tax and welfare system to provide a guaranteed income for everyone, increasing U.K. statutory sick pay to the EU national average, including self-employed people in the coronavirus job retention scheme, strengthening welfare protections by increasing [the] child benefit, and making the £20 universal credit increase permanent whilst extending it to legacy benefits,” Thewliss said. She called on ministers to “wake up to the urgency of this situation.”
Businessman and philanthropist John Caudwell told Channel 5 News on January 11 that he recognized the complexities involved in addressing the gaps in support. “But I’m extremely disappointed that [ministers] seem to be able to feel that they can leave these 3 million people completely neglected,” he said. “It’s desperately unfair, and desperately damaging to those people’s lives, their [families'] lives, and to the economy for the future. There has to be fairness; you cannot have a section of society that are completely unsupported and are told they cannot work.”
HM Treasury will accept online representations on the March 3 budget until 5 p.m. GMT on January 14, when the portal will close.
Business Rates
Separately, Conservative MP Kevin Hollinrake is sponsoring the Abolition of Business Rates Bill, which will receive its second reading on January 15 but is unlikely to make further progress. (Prior coverage of business rates.)
Hollinrake claimed that his bill "abolishes business rates completely and replaces the revenue with a small increase in VAT, thereby fundamentally leveling the playing field between online and our precious local high street businesses." He has considered the government’s manifesto commitment not to increase VAT in this Parliament, he told MPs on January 12, adding that “the scale and pace of change to the business landscape necessitates a new approach today.”
Only a minority of private members' bills become law, “but, by creating publicity around an issue, they may affect legislation indirectly,” the U.K. Parliament website notes.
Time to Pay
Almost 25,000 self-assessment taxpayers have set up an online payment plan to manage their tax liabilities in up to 12 monthly installments, totaling £69.1 million, HM Revenue & Customs said in a January 13 release.
“We know the past year has been tough for many businesses and self-employed people, which is why we’re helping them spread the cost of their tax bill into monthly payments. Self-assessment customers can use the self-serve time to pay facility for amounts up to £30,000,” said Karl Khan, HMRC’s interim director general for customer services.