Who won contractors’ votes at the IPSE self-employed hustings

Representatives from all the major political parties gathered in London on November 25th to debate their policies for small businesses, and the self-employed – workers who are vital to the economy and the country, writes Alasdair Hutchison, policy development manager at the Association of Independent Professionals the Self-Employed.

Co-organised by IPSE, Enterprise Nation, The Entrepreneurs Network, COADEC and the ICAEW, the event saw the main focus of the opening remarks on Brexit. Unsurprisingly perhaps.

A heated Brexit (debate)

For the Conservatives, Liz Truss MP kicked off by saying only her party would be able to ‘get Brexit done’. She promised to cut red tape and make the UK the best place to be a business. “Entrepreneurs are people we should cheer at, not sneer at”, she said.

The Liberal Democrats’ Ed Davey MP challenged the Tories’ position on the EU and said that if we want to keep the free trade principles of the UK, then “we must stop Brexit”.

The Greens’ Amelia Womack added her party’s support for a People’s Vote “so small business owners can have the final say on Brexit”.

Bill Esterson, Labour’s shadow small business spokesperson, said “the fundamental cornerstone of the Conservative manifesto is a hard-Brexit which will do damage to businesses”.

Then, the Brexit Party’s Hector Birchwood said that only by leaving the EU could businesses get truly global free trade.

Away from the heated Brexit debate, there was also a lively discussion around IR35 reform, currently incoming to the private sector from April 2020.

IR35 commitments: who said what

For the Lib Dems, Mr Davey stated that “we need to celebrate contractors and the self-employed” and added that Loan Charge 2019 “is a scandal and a disgrace”. He described the plans to move the determination of IR35 to the engager “a disaster for flexibility” and reaffirmed the party’s manifesto pledge to review the IR35 changes to the private sector.

For Labour, Mr Esterson said his party would review the implementation of IR35 in the public sector, which he described as “slapdash”, and pause any similar rollout to the private sector.

Although Mr Esterson confirmed this was party policy on social media afterwards, the pledge is not in Labour’s manifesto and yesterday, he seemingly backtracked by deleting his Tweets on the issue. Rest assured, we will be seeking urgent clarification on the party’s position.

Mr Birchwood of the Brexit Party went further, saying he would “eliminate” IR35 altogether. He said it was a tax that “simply does not work”.

Liz Truss promised a Conservative government would “conduct a review and make sure we are treating the self-employed fairly”. The Conservative manifesto makes some reference to making the tax system work better for the self-employed as part of its proposed review. However there is little detail to reassure contractors that the ‘party of business’ are taking on board concerns about IR35 reform. 

Aside from mixed IR35 messages, what else is pledged to contractors?

 The parties were also asked more broadly about what they would do to back freelancers and small businesses.

Mr Esterson praised IPSE’s manifesto and backed our calls for action on late payment and incentivising workhubs. He said Labour “will use the procurement system to ensure that big firms that win public sector contracts have to pay suppliers within 30 days”. Ms Truss added her voice to those wanting to “give more teeth” to the Small Business Commissioner on late payment.

Late payment was an issue of cross-party consensus, with every party agreeing more action was needed. Ms Womack said her party would fine companies that paid later than 30 days.

She added that the Greens support a Universal Basic Income of £89 a week – something she said would help freelancers with their revenue during times where they are looking for work.

The parties also pledged action on pensions and access to credit, particularly mortgages, so that freelancers were not left behind. 

More worrying if you’re a freelance or contractor running your own limited company, is Labour’s plan for dividend taxation – hinted at in its manifesto, but confirmed directly in its manifesto-costings document.

In particular, Labour wants to abolish the lower income tax rate for dividend income, as part of its new policy to tax dividends at income tax rates.

The onus on Jeremy Corbyn’s party to now clarify its stance on IR35 reform so we can gauge whether Labour really is behind the self-employed is made even greater by this unwelcome tax proposal.

And the winner is…

The audience was polled before and after the debate about how they were intending to vote.

And it is the Lib Dems’ Ed Davey who emerged as the outright winner!

The following numbers are based on the responses of our 100-strong voting audience.

Conservatives

24% (36% pre-debate)

Labour

11% (21% pre-debate)

Lib Dems

54% (38% pre-debate)

The Green Party

7% (2% pre-debate)

Brexit Party

4% (2% pre-debate)