MPs and peers have repeatedly called on the Chancellor to plug “devastating gaps” in schemes that have seen around three million people excluded from Government support for almost a year.
Before the Budget, the All Party Parliamentary Group on Gaps in Support published a number of recommendations to extend the Government’s support packages.
In particular, the group called for various policy adjustments to the Self Employed Income Support Scheme (SEISS) and the Coronavirus Jobs Retention Scheme (CJRS), to support the newly self-employed, PAYE freelancers, Ltd company directors, new parents and pregnant women. The APPG also called on the Treasury to provide support for the newly employed and those denied furlough.
The plight of those who continue to be denied support is made clear in a letter to Treasury Minister Jesse Norman from the campaigning group ExcludedUK.
The letter says: “You state that the Government recognises that there are “hard cases”, but there are simply far too many, while personal circumstances have so often placed these individuals beyond the scope of the schemes in a manner that is wholly unfair, unjust and discriminatory.”
The letter provides a few examples, which illustrate why members of ExcludedUK feel a profound sense of injustice. They include a make-up artist who had been self-employed for nine years. Her husband died suddenly in 2018, which meant she was in receipt of bereavement payments.
The woman also took her late husband’s pension payout in February 2019 to invest in her business to support her two children. As a result, she found herself beyond the scope of SEISS since the bereavement payments and pension payout took her beyond the 50% trading profits criteria. Had she taken the pension payout five weeks later, she would have been able to access support.
I’ve been contacted by another member of ExcludedUk, who before Covid, was a co-director with his wife of his own company. The man said he had good and bad years, but on the whole, was doing “pretty well” until the pandemic struck.
He added: “Seventy per cent of my income and 100% of my wife’s derive from live performance, which disappeared in March 2020. We have had £550 per calendar month worth of furlough, and the bounce-back loan, but despite working very hard to plug the gaps, our turnover is 25% of what it was in 2019, and we have accrued tens of thousands of pounds of debt. We are the enterprising small businesses the Tories claim to support, but we’ve had next to nothing.”
Another member of ExcludedUK said: “I can no longer sell my possessions as I have nothing left, but still my Government mocks me as being a fraud.”
There is no doubt the furlough scheme has saved millions of livelihoods, according to Professor David Spencer of Leeds University Business School,
Professor Spencer said: “At its height, the furlough scheme protected over nine million people who would have faced a massive drop in income.
“During the pandemic, unemployment has risen from 4 per cent to 5 per cent, so furlough has stopped unemployment from rocketing. The Government has responded to the non-inclusion of the self employed, but it has been stubborn in other areas particularly in relation to unemployment benefits and sick pay. The decision to furlough staff, for example, has been left to employers. Furlough doesn’t protect employees from redundancy.”
The Government said it has done all it can to support jobs through its £350 billion support package, and the UK’s self-employed and furlough schemes are among the most generous in the world.
The cross-party concerns about the wide range of people who have fallen between the gaps must be examined in a public inquiry. A formal probe could decide what lessons can be learned from the crisis, so nobody is left behind in future pandemics.