IPSE welcomes government’s response to Matthew Taylor review

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The Association of Independent Professionals and the Self-Employed (IPSE) have welcomed the government's comprehensive response to last year's Matthew Taylor's review into modern work.

The government have responded to the review in a considered and detailed report that the IPSE says will need to be analysed fully, but overall the self-employed body are pleased that there is a level of commitment to addressing long-term issues.

This includes uncertainty surrounding employment status and the need for additional support for the UK’s contracting sector. However, there is particular relief concerning the government’s decision not to take forward the recommendation to move towards greater equality between employee and self-employed National Insurance Contributions (NICs).

IPSE’s CEO, Chris Bryce, said, “Overall, the Government’s response to the Taylor Review is very positive for the self-employed. Its pledges to clarify the confusion over employment status, define ‘good work’ and generally improve support for the self-employed are particularly welcome. The key thing now though is that the Government doesn’t kick these pledges and consultations into the long grass. We will be working closely with the Government in the coming months to make sure that this does not happen and that any coming changes help and support the self-employed.”

Commenting on NICs, he added, “The self-employed currently pay a lower level of NICs because by providing flexible expertise for businesses across the UK, they take on much higher levels of business risk than their employed counterparts. Through their freedom and flexibility, the self-employed add huge amounts of value both to businesses and the wider economy. They should not be punished for this with tax rises.”

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On employment status:

“The confusion in the self-employed sector is worsened by the misalignment of tax and employment law. This is because the off-payroll working rules, which came into force last April for the public sector, impose one status for tax and the opposite status for employment rights. We were pleased to see the Government committing to address this problem.

“Another positive for IPSE was the fact that the Government has not fully accepted Taylor’s proposal to change ‘worker’ status into a new and reformed ‘dependent contractor’ status. IPSE was concerned this would only add to the confusion in the sector and that the new status could even be too reductive. It is certainly positive that instead of adopting the new status, the Government has committed to consulting on changing the tests for worker status.”

On improved support:

“The lack of pension provision among the self-employed has been a growing concern for some time: it is excellent that the Government has pledged to explore ways to ‘improve pension provision among the self-employed’.

“The one area here where the Government’s response is lacking is parental benefits. Although the Taylor Review recommended improved parental benefit provision for the self-employed, the Government does not seem to have taken this forward. It is unjust that while employees can receive both paternity and maternity pay, self-employed mothers only receive a much smaller Maternity Allowance and self-employed fathers get no benefits at all.”

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