The government is to increase its support for the self-employed and will double grants to 80 per cent of income, but criticism remains that some in the sector are still being “ignored”.
Chancellor Rishi Sunak announced yesterday (November 2), that Self Employed Income Support Scheme (SEISS) grants will be calculated on the basis of 80 per cent of average earnings for the month of November, which brings it into line with the extension of the Coronavirus Job Retention Scheme.
The scheme currently covers 40 per cent of average monthly profits up to £3,750 for a three-month period, but yesterday’s announcement brings the maximum grant to £5,160.
As SEISS grants are calculated over three months, the uplift for November to 80 per cent, along with the 40 per cent level of trading profits for December and January, increases the total level of the third grant to 55 per cent of trading profits.
Payments will also be made more quickly with the claims window being brought forward from December 14 to November 30.
In addition, more businesses will be able to access support as deadlines for applications for government-backed loan schemes have been further extended until January 31, 2021.
Mr Sunak said: “So far we’ve provided £13.7bn of support to self-employed people through the crisis - and I’ve always said we will continue to do everything we can to support livelihoods across the UK.
“The rapidly changing health picture has meant we have had to act in order to protect people’s lives and I know this is incredibly worrying time for the self-employed.
“That is why we have increased the generosity of the third grant, ensuring those who cannot trade or are facing decreased demand are able to get through the months ahead.”
The scheme is only available to those who were continuing to actively trade but faced reduced demand due to coronavirus, and those who were eligible for the first and second grants.
Despite wide-ranging support for the boost to the scheme, fears remain that some self-employed workers are falling through the cracks.
Derek Cribb, chief executive officer of IPSE (the Association of Independent Professionals and the Self-Employed), said it is “deeply troubling” that the government has still not fixed the gaps in SEISS, despite “urgent recommendations” from the Treasury Select Committee.
He said: “After so many calls to resolve the problems, it now looks as if the government is wilfully ignoring a third of the self-employed.
Similarly, Seb Maley, CEO at Qdos, a tax specialist for freelancers, contractors and the self-employed, complained that freelancers and contractors had been overlooked again.
He said: “It’s a deliberate, short-sighted and callous move to ignore these individuals simply because they work via their own limited companies.
“The irony, of course, is that it will be these workers who the government needs most to kickstart the economy.
“It’s vital, therefore, that the Prime Minister tailors the support available to this key sector of the workforce before it's too late.”