There are currently around 4.79 million people in self employment and around 600 thousand new limited companies being formed every year. If we were to adopt proportional representation this 'constituency' would be viewed in a very different light and be treated very differently. With this growth showing no signs of slowing there are several key areas that need to be addressed:
- The lack of affordable workspace - many people are working from home and are not able to expand and create jobs. A possible solution might be to encourage Local Authorities to allocate space/create work hubs.
- The need for a 'self employed bank account'. Traditional business accounts come with bank charges which force people into using their personal accounts. A simplified business account should be introduced allowing in and out transactions to be made without cost.
- Suitable financial services. The self employed literally drag themselves to work when they are poorly so realistically priced income protection and medical cover should be introduced.
- The levelling of the playing field in terms of maternity and paternity pay so that they aren't just available to employees.
- Pension provision. Employers are now being compelled into creating and contributing to a pension scheme for their employees. This Auto Enrolment has put in place a framework to make it far easier for employees to save for their future and AE rules stipulate that charges should be low. A similar scheme needs to be created to encourage pension savings by the self employed. If nothing is done we will be allowing millions of people to sleepwalk into a retirement of destitution.
49 percent of self employed people pay themselves less than the living wage so, while it is laudable to encourage employees to save for their retirements, we have a massive sector that cannot even pay for today let alone worry about tomorrow.
Self employment is a choice but we cannot allow a two tier society to evolve. The country is already struggling with an increased population living longer, often in poor health, and we are also now seeing the baby boomer generation starting to retire which will further increase the strain on taxpayers.
Governments historically only look as far as how to get themselves re-elected but these new issues surrounding self employment need to be thought through urgently. The trouble is that all of the decision makers involved in the areas listed above are employed and do not appreciate how critical they are. A Minister for Self Employment is worthy of consideration and, on appointment, would be most welcome to seek our advice.
With the above in mind, Your Business Community is creating a campaign and has started a petition on the Government website pushing for the creation of this essential new ministerial position. More on the campaign will follow, however, please sign up to the campaign as soon as possible, here.