Help the self employed

The UK needs more self employed people. It needs more self employed people who can go on to employ others and to set up small businesses. More self employment  brings more choice, more innovation., more local service . Out of a swelling host of self employed more larger businesses will emerge when someone’s idea and dedication to service takes off.

The covid lockdowns damaged a lot of small businesses and hit many self employed hard. An older  generation of self employed took a look at early retirement and some went for it, frustrated by the bans on their activities and the limitations placed on their customers by covid rules. Meanwhile changes to the rules of IR 35 in 2017 and 2021 made it more difficult for some to set up as self employed or to maintain that status even though they were genuinely on their own and searching for a range of customers and clients.

The government as it ponders how to encourage more people back into work at a time of more jobs than applicants should regard promotion of self employment as part of the answer. It should revisit tax rules to make sure they do not penalise those who are  independent and not enjoying employee benefits from a single “client” whilst in practise just working for one company. Some setting up in business may well start with just one client or customer, but are open for others and trying to win others. They do not enjoy employee rights with their first customer, but are desperate to diversity their customer base.

127 Comments

  1. Peter Wood
    January 24, 2023

    Good Morning,
    Sorry off this topic but ref your Tweet on sidebar on German Tanks.
    Here’s an idea: why not give Ukraine ALL our Challenger 2 tanks, with all the stored ammunition, since we’re upgrading to Challenger 3 tanks. The cost of replacement tanks should be entirely paid from the ‘foreign aid’ budget.
    The Challenger 2 was designed to fight the Russian armour, let them.

    Reply
    1. Sea_Warrior
      January 24, 2023

      Because the Challenger 3s won’t be new-builds; they’re upgraded 2s. And some of our 2s are on NATO’s front-line.
      I am not in favour of hollowing-out the too-small British Army so that we can give to Ukraine what it should have bought five years ago. And I am sick and tired of seeing Johnson making countless trips to Ukraine, to wallow in Ukrainian praise, when it was he who didn’t want to sell arms to Ukraine, for fear of upsetting Russia. Sickening!

      Reply
      1. Peter Wood
        January 24, 2023

        Yes, good points, but IF the cost of the whole of the new Challenger 3 were paid by the Foreign Aid budget, (perhaps an arguable idea) don’t you think a better, lightweight chassis could be included. The upgrade idea was surely a cost saving. I wonder how quickly the supplier could start deliveries if the cash were available this year.
        Regarding hollowing out our MBT force, who else are we planning on fighting with it other than the Russians.

        Reply
    2. Clough
      January 24, 2023

      Why not, Peter? First reason, because Challenger 3 production is planned for 2027-2030. Do you want to leave the army with no MBTs till then? Second reason, Challenger 2 was designed over thirty years ago to fight the Soviets and is way behind what the Russians have now. It has been upgraded a lot, but is it up to facing off with the latest Russian tanks? Who do you see using them, so we can find out -maybe Ukrainians, to act as guinea pigs? Or British guys?
      Not a good plan, in my opinion.

      Reply
    3. Cuibono
      January 24, 2023

      We’ve only got about 200 Challenger 2s and Challenger 3 not due until 2027.
      Anyway Ukraine doesn’t want our inferior tanks…only deigns to accept German Leopards 2s.
      Plenty of those in Europe ( 2000?) and much better at killing…fast and not prone to blowing up the passengers/driver or what have you.
      HOWEVER …here’s the rub ( lol) Germany is reluctant to stir up memories of its rather unpleasant war history probably knowing that the rest of Europe would totally rat on it if it kills too many people and the war goes even more wrong!
      Now let’s think who else came unstuck trying to invade Russia.

      Reply
    4. Lynn Atkinson
      January 24, 2023

      Who is going to drive them? Who is going to maintain them? Mission creep towards a very short sharp last exchange of fire!
      This is not Vietnam or Afghanistan, this is a nuclear superpower we are prodding and poking at.
      WHY?

      Reply
      1. BOF
        January 24, 2023

        L A.
        I agree with you. I am personally horrified at the constant ramping up of this, the most dangerous war in my lifetime, between the two most corrupt countries in Europe, imo. I have no trust at all in US motives and believe we should stay right out of it. If our politicians think they will soon break Russia, then they may find there is a very long way to go.

        Reply
    5. Beecee
      January 24, 2023

      I think you will find that the Challenger 3 is a conversion of existing Challenger 2s.

      Reply
  2. Cuibono
    January 24, 2023

    Get rid of regulation then.
    I have had two personal experiences of good self-employment being ruined by creeping red tape.
    Absolutely planned by the govt. at the time I have no doubt.

    Reply
    1. Nottingham Lad Himself
      January 24, 2023

      Many people are only reluctantly self-employed, and simply because the terms and conditions of employment allowed by the Tories are so grinding and demeaning that there is now no alternative for them.

      The voluntary sector is suffering terribly as a consequence of this. Employees now cannot say when they will have any free time to devote, and early retirement on proper occupational pensions is – unlike on the Continent – out of the question too.

      Reply
      1. a-tracy
        January 24, 2023

        You’ve got your rose coloured specs on in relation to EU pensions again, even Finland had to match pension ages with life expectancy: https://www.intereconomics.eu/contents/year/2020/number/2/article/pension-systems-in-the-eu-some-policy-issues.html

        The number of people claiming pensions has actually dropped in the UK. https://www.gov.uk/government/statistics/dwp-benefits-statistics-august-2021/dwp-benefits-statistics-august-2021

        Reply
      2. Peter
        January 24, 2023

        NLH,

        Certainly more are reluctant now. In the 1970s ‘The Lump’ was a game changer for building workers.

        There are also huge numbers of food outlets and restaurants on High Streets near me. You wonder how they survive. Lots close a year or so after opening. You wonder if going bust and reopening under a new name is a career choice.

        I don’t understand motorcycle couriers outside KFC and McDonalds. How lazy do you have to be to get their offerings delivered?

        The gig economy is not all it is cracked up to be.
        .

        Reply
        1. Peter
          January 24, 2023

          When I worked on building sites it was 8am until 6pm. You got holiday stamps.

          Now builders knock off about 3pm.

          Reply
          1. Mickey Taking
            January 25, 2023

            usually due to the local roads being log-jammed by mums queuing and parking anywhere to collect little Zayn or Beyoncé from 3pm onwards.?

      3. Mickey Taking
        January 24, 2023

        absolute hogwash.

        Reply
    2. Nigl
      January 24, 2023

      It’s because they and civil servants live in a self justifatory bubble. Sir JR ask one of your small business to keep all the paperwork, requests for information, new refs, changes to regs, guidance etc from HMG for six months. Would be impressive to take on the floor of the House and wave at the PM/Business Minister in support of a question.

      A business I worked with did and it was an egregious amount. As ever ok (not but manageable) for large companies with dedicated resource but SMEs/self employed, it is a chain round their necks.

      Reply
      1. IanT
        January 25, 2023

        “The cash haul from the Energy Profits Levy (EPL) was 24.5pc (£600M) less than forecasts prepared in November.
        Meanwhile, separate survey data showed British private-sector activity fell at its fastest rate in two years in January, as businesses blamed higher borrowing costs and increased consumer caution for the slowdown”
        (Source: The Telegraph)
        Well that’s surprising Jeremy – I don’t suppose that’s what the Treasury wonks promised you was it?

        Reply
    3. Bloke
      January 24, 2023

      Consumer demand pulls employment to flow smoothly in delivering the services those working people provide. This Govt has restricted normal freedoms unduly and created needless obstacles: penalising self-employed folk who simply want to work with payment for the solutions their efforts provide. Such bad Govt is unworthy of support and is losing it rapidly to the Reform Party.

      Reply
    4. Dave Andrews
      January 24, 2023

      Employ one person and immediately you have to set up a pension scheme.

      Reply
      1. a-tracy
        January 24, 2023

        Employ one person and you have to do a lot more than that.
        You have to pay the full SSP for 28 weeks, plus Sick Holiday pay at 28 days per annum pro-rata.
        You have to pay a % of SMP/SPL and SMP holiday pay for the duration of the leave,
        Insurances,
        Policies,
        Learning all the rules, regulations, health & safety,
        Your wage bill is controlled by the government via the mechanism of the WTD and national minimum and national living wage a 10% increase for all from this April.
        Oh and they’re taking 25% of the profit before you pay yourself from April.

        Reply
      2. Mickey Taking
        January 24, 2023

        Mind bogglingly difficult?

        Reply
      3. glen cullen
        January 24, 2023

        The killer of any small business and a restriction to anyone wanting to expand from self-employed to SME

        Reply
  3. Cuibono
    January 24, 2023

    As far as I have been told regulation means that all tradesmen are obliged to pay to go on on this or that course ( no doubt all woke and bogus). This puts up the cost of getting jobs done and I have known double glazers and gasmen quit asap because of the huge burden of paperwork and expense of attending such courses.
    We now have very few butchers’ shops because of regulation.
    How convenient for the bug pushers!

    Reply
    1. Fedupsoutherner
      January 24, 2023

      Agree Cuibono. My husband was held hus City and Guilds in gas fitting. He worked for British Gas for over 33 years and was part of the gas conversion teams. He went self employed but was restricted from working on gas boilers because of the new Gas Safe regulations and because he hadn’t attended the expensive and not very in depth compulsory courses. He was appalled by the low standards of work the new gas fitters who had been trained in recent years.

      Reply
    2. Wanderer
      January 24, 2023

      Cb, very true. One of the major attractions of being self employed, as a tradesman, is the liberty to get out and work without being told what you can and can’t do.

      If you are effectively mandated to get a course certificate for this or that at the government’s/insurers’ whim (and lobbying by the training industry), then you lose that feedom, and your future is more uncertain because at any point you risk losing income or even your livelihood (if you don’t pass a newly-mandated course, or don’t qualify for doing one).

      Reply
    3. Bloke
      January 24, 2023

      Training courses to maintain important quality standards, such as safety are important. Regulation beyond essentials is usually automatic and fast-remedied without Govt interference. If a self-employed supplier performs badly, the paying client could reject their work and payment instantly.

      Reply
      1. turboterrier
        January 24, 2023

        Bloke.
        Safety standards? You are having a laugh. In my day when you pressure tested gas supplies the U gauge could not move. If it did, you stayed there to find it. For years now there has been “permissible drop” over the 2 min period.
        That depends on the size of the installation. How many fitters today know how to calculate the size of a system and the volume of gas it holds?
        Not many, that’s ifthey even think about its relevance. More like trust in your phone and consult Google!!!

        Reply
      2. Ashley
        January 24, 2023

        Almost always government regulations are a sledge hammer used to mis the nut as Chris Booker used to put it. Often making things worse and even less safe.

        Reply
    4. Ashely
      January 24, 2023

      +1

      Reply
    5. Timaction
      January 24, 2023

      A lot of tradesman complain of additional costs due to Councils charging to go into their new low emission zones. All because of Westminstersvobsession with net stupid. All parties the same. Costs being passed onto the consumer. Own goals by the uniparty.

      Reply
  4. Cuibono
    January 24, 2023

    It is now virtually impossible to get any tradesman and the older stalwarts are packing up because of regulation and PETROL PRICES! Young ones are very rare indeed.
    Window cleaner said his petrol bill was £300 per month.
    He now comes very spasmodically and charges at least double!

    Reply
    1. Ian wragg
      January 24, 2023

      Government and HMRC don’t like the self employed
      Because the majority of politicians are corrupt and untrustworthy they place them in the same bracket.
      Who would want to risk there livelihood when there are excellent non jobs in the public sector with plenty of paid holidays and bumper pensions.
      I was self employed in the middle east where we were valued, not viewed with suspicion.

      Reply
      1. ukretired123
        January 24, 2023

        Exactly Ian, self employed are not understood because unless you have experienced it yourself you can never relate to it. Hence HMRC take the negative view of being difficult to understand and why you cannot be normal have a normal job like everyone else? You must be on the fiddle.
        The banks misunderstand self employed asking “Was this a hobby?” Ridiculous.

        Reply
    2. Sea_Warrior
      January 24, 2023

      How much was your window-cleaner earning a month? Lots, probably. I recently had to call someone in to fix a garage door. His total time (travel and work) was less than an hour. His bill £60. He was backed-up with jobs, initally wanting me to wait a couple of weeks. I suspect that he was earning more than my MP.

      Reply
      1. Ian wragg
        January 24, 2023

        He was of more use than your MP probably

        Reply
    3. Mickey Taking
      January 24, 2023

      I suggest he operates in a smaller ’round’ or plans the route where he goes on any given day. Ours moves on to next customer as close as possible – bit of a no brainer?

      Reply
      1. Cuibono
        January 24, 2023

        Well that’s what you’d want to do if starting up now. Preferably with a ladder and bike and therefore have a compact and local round with rock bottom costs and hopefully charges.
        However, he started his far flung round when petrol wasn’t a consideration for him or his competition.

        Reply
        1. Mickey Taking
          January 25, 2023

          Cycling with a ladder, climbing it with bucket, squeegee, sponge, rag etc evokes all sorts of H&S, Insurance matters – enough to kill the business before even starting?

          Reply
          1. glen cullen
            January 25, 2023

            Don’t forget the risk assessment, method statement, DBS checks if you recruit anyone under 18, loler equipment testing, loss of earning insurance, ulez transport, job work/card records (evidence of income to HMRC) and receipts book ….thats min

  5. DOM
    January 24, 2023

    I applaud this article but the term ‘self’ doesn’t lend itself to the newly created collectivist culture that filth Labour and the ‘capitulatory’ Tories (to appease their enemy of course) have helped to create. Self-subjugation to the greater ‘good’ is now order of the day. Those who stand aside FROM the Socialist State like the self-reliant and self-employed are deemed worthy of attack and assault. They are to all intents and purposes the ‘enemy of the people’. I don’t believe such an assessment is to far away from the prevailing mood deliberately constructed by political players.

    I always remember a Labour MP who was fond of quoting the fact that the word SELF forms the first four letters of the word SELFISH and that is how both parties view the self-employed, with contempt

    I see Lammy the Mastermind genius is proposing an UK-EU security pact. Talk about a shameless transparent policy of tying in our security with closer EU ties and dare those who oppose it in case they are accused of putting the security of the UK at risk

    It is difficult for those like John who though he won’t publicly admit it recognises his party is now so captured by the woke and the collectivist that he may as well call himself a Socialist along with his colleagues. The true victims of woke are all around

    Reply
  6. Stred
    January 24, 2023

    There are many younger entrepreneurs who work from the UK and abroad providing internet services such as design and agencies linking worldwide clients. The taxation systems in Europe including the UK , particularly VAT, corporation tax, capital gains, NI, pensions and income tax make registration at home impossible. Competitors in other countries would offer cheaper services.
    HMRC now insists that these entrepreneurs are employees of the companies that they own, as directors registered in other countries with less onerous taxation. The corporation tax and accountancy services are paid in these counties.
    Could anyone have thought of a better way for the UK to lose taxable income?

    Reply
  7. Mark B
    January 24, 2023

    Good morning.

    But the SME’s do not offer nice director and chairman positions for current and retired MP’s. 😉

    So tough !

    Reply
    1. Ashely
      January 24, 2023

      +1 mainly driven by corruption and vested interests.

      Reply
    2. glen cullen
      January 24, 2023

      Good point

      Reply
  8. turboterrier
    January 24, 2023

    Over regulation and dumming down trade qualifications hàs not done the self employed domestic installation market any favours. Trade exams with multi-choice questions, practical exams based on assessments. The need to get re certificated every few years all adding up to expenditure.
    It was no accident that trade qualifications were staggered into first, second, third and craftsman and paid accordingly. Now its one size fits all
    As long as they have a badge (s) on the side of the van.
    Very few central heating engineers can do a complete design with heat losses flow rates. This is going to affect the heat pump dream. The HP is just a power source and it is as only good to the system it is bolted onto. The drive for easier installation bought about mini and micro bore heating systems, totally un suitable for a HP with much lower mean water operating temperatures. It is all a disaster waiting to happen.

    Reply
  9. Anselm
    January 24, 2023

    I live in the rapidly disappearing countryside with new houses springing up everywhere. Recently, due to a leaking pipe, we have had tradesmen in to repair the damage in our lounge. Every single one of them has worked hard, been paid regularly (by the excellent insurance company) and were happy in their work. I was delighted to see too that two of them had taken the trouble to employ apprentices. And all of them had a lot of demand on their services.

    Reply
    1. Fedupsoutherner
      January 25, 2023

      Anselm. You are lucky then. I know a few people who have experienced disasters wuth tradesmen. I find the older ones to be the best.

      Reply
  10. Mick
    January 24, 2023

    The government as it ponders how to encourage more people back into work
    There should be NO encouragement there should be if you don’t take a job offered to you then you get no money, stop this culture of money for nothing encouraged by the conservatives and labour and get people back to work , no job no money

    Reply
    1. MFD
      January 24, 2023

      Mick,
      You have hit the nail squarely on the head, stop all this socialism and that cures a lot of the problems we have at present.
      No migration if they are not housed, no druggies as they cannot lie about and still have money for whatever they use!
      It also stops the attraction to the foreign invaders within!

      Reply
    2. turboterrier
      January 24, 2023

      Mick
      ++++ 1000s
      Stop it all, nothing till 3 years contributions. In my street families on £20k + far better of than those busting their fans trying to give their families so resemblance of a good life. One young lad said to his dad ” who are the mugs then, us or them, why do I bother with school”?

      Reply
  11. BOF
    January 24, 2023

    Business will continue to suffer and decline so long as the staggeringly ill informed politicians stay wedded to NZ and anthropogenic climate change, refusing to allow UK resources to be exploited. Energy and fuel prices play an integral part in business and the ability to compete.

    IR35 must have been deliberately designed to damage small and medium business. Get rid of it.

    Reply
    1. Ashely
      January 24, 2023

      +1

      Reply
  12. Sharon
    January 24, 2023

    Another example – Together Declaration sent an email last night, with a short video clip of a shop owner in Haringey. She spoke on behalf of all the local shop owners and described that the LTN has practically killed of small shop owners in the part of Harringay where she has /had a couple of small businesses, such is the shortfall of customers. Drivers from out of Harringay cannot now get there, or choose not to bother!

    This ridiculous attack on the motorist is killing off small businesses. Plus, the absurdly high parking costs!

    The irony is, the alternative is these out-of-town retail parks, which are drive-to sites but are larger retail stores!

    Reply
    1. BOF
      January 24, 2023

      Sharon. Yes exactly, and when these councillors then divide the cities into 15 minute zones their will be nothing left for residents within 15 minutes so they will either be fined for leaving their zones or travel out of town. Quite insane.

      Reply
  13. Lynn Atkinson
    January 24, 2023

    I wonder if any present day MP has established a small business? They seem oblivious of the contribution small business make to the economy and what skill and dedication it takes to run a small business.
    Richi generously put up the wage bill of those who work for small businesses. Often the proprietor – who lives on the remaining profit, is the worst paid of the workers. I know of small businesses declaring bankruptcy and in their newly set up business,count the proprietor as an employee so he/she can draw a wage.
    If government makes it impossible for people to earn an honest income, they will be forced to earn an income anyway. Is this what Government wants? A black economy many times the size?

    Reply
    1. Ashely
      January 24, 2023

      Indeed a doom loop as the more black economy there is the more honest businesses are unable to complete. So the rich and hard working either give up or leave the country. Others go black market and live off benefits but with some bartering or cash in hand work on the side.

      This seems to be the insane Rishi Sunak agenda. I will not work. Already 50% of people get more in benefits than they pay in taxes.

      Reply
    2. Sir Joe Soap
      January 24, 2023

      There’s one who’s dad ran a pharmacy, he once told me

      Reply
    3. BOF
      January 24, 2023

      +1 Lynn.

      Reply
    4. a-tracy
      January 24, 2023

      Public sector: On appointment staff receive 27 days plus bank holidays [35 minimum]. After five years of service this increases to 29 days plus bank holidays [37]. After ten years service this increases to 33 days plus bank holidays [41]. Plus full paid duvet days, and absenteeism, people are mad to go self-employed now. MAD!

      2022 ‘the government’ gave an extra two days bank holidays but didn’t reimburse smes or the self-employed for their two extra days’ of loss of trade/turnover/profit.
      2023 ‘the government’ is giving an extra one day bank holiday.
      Calculate all those missed operations, treatments etc in the NHS it all has a massive cost, but who cares.

      Hunt has indicated the NMW/NLW will go up by 10% April 2023. All pay differentials in the private sector (just as in the public sector) demand parity. Customers aren’t willing to pay the last increase in October 2022 and trading is down but costs up, it is a bad recipe.

      Reply
    5. Mickey Taking
      January 25, 2023

      your last 2 sentences brought Greece, Italy and Nigeria to mind.

      Reply
  14. Nigk
    January 24, 2023

    This government is obsessed with tax raising hammering all businesses to the extent money is going abroad, not coming in or stunting ambition, Sunak is too weak to push back against Treasury orthodoxy ignores Laffer.

    I see the Passport Office is being allowed to put up prices despite a continuing appalling service. Ten weeks when each one, particularly renewals, when you have existing data, should only take minutes.

    For people with urgent needs the price rise is even steeper, so business people essential to the U.K. get hit the hardest.

    Well done HMG. Another bullseye.

    Reply
    1. Fedupsoutherner
      January 24, 2023

      My new passport came in 16 days. I used the fast track service in my local post office.

      Reply
      1. a-tracy
        January 25, 2023

        No need to fast track at the moment because it is quiet in the Winter renewing passports, they should have an average response time alert on their websites and they should advertise, renew your passport now so they don’t cause the problems when so many of their staff start going on holiday again at peak times.

        Reply
      2. Mickey Taking
        January 25, 2023

        16 days is thought to be fast?

        Reply
        1. hefner
          January 25, 2023

          Well, the information has to go to Poland where the passport is actually printed. Then the passport is sent to Britain. 16 days looks pretty good to me.

          Reply
        2. a-tracy
          January 26, 2023

          https://mybritishpassport.com/where-are-uk-passports-printed/

          This is interesting, I wonder how much of the delay last summer was in the printing abroad or were the hold-ups just in the processing in the UK? Theresa May, I think gave the UK contract from a UK based company to the foreign company on price.

          Reply
  15. Javelin
    January 24, 2023

    Tax and red-tape destroyed the self-employed.

    This is not a minor thing. This is part of the corporatist world view that people should work for large companies and earn less whilst paying higher taxes. This has the effect of driving some people into corporates on lower wages and some people out of the workforce on benefits.

    This is the corporatists world view.

    Reply
    1. Ashely
      January 24, 2023

      +1

      Reply
    2. Cuibono
      January 24, 2023

      +many
      Oh…that explanation fits like a glove!
      Thank you!

      Reply
  16. Dave Andrews
    January 24, 2023

    We have the prospect in a year’s time of a Labour government. Why should anyone want to set up in business right now when that lot are just over the horizon, considering employers as some kind of evil that must be eradicated?

    Reply
    1. Neil Sutherland
      January 24, 2023

      The direction of travel will remain the same with more diverse political opinions within parties than between them. Vive la Uniparty comrade!

      Reply
    2. John Hatfield
      January 24, 2023

      Don’t vote Labour, vote Reform.

      Reply
  17. Sakara Gold
    January 24, 2023

    People become self-employed for many reasons, but many SME’s have given up and closed because they cannot cope with the ridiculous extra paperwork needed to maintain their exports to customers in the EU

    Anyway, whenever entrepreneurs manage to grow a successfull export business, the government allows predatory American buy-out funds to snap them up, close down their factories and move production to Wisconsin. The redundant staff and workers become self-employed to use their skills, feed their families and pay their mortgages. This problem has been execerbated because there has been very little foreign inward investment since the Brexit referendum

    Reply
    1. IanT
      January 24, 2023

      “Both the outward and inward FDI (Foreign Direct investment) positions increased in 2020 compared with 2019. The value of the UK’s inward FDI position increased the most, by £288.7 billion, while the outward stock increased by £13.5 billion”

      Source- ONS Website

      Reply
    2. Mickey Taking
      January 24, 2023

      ‘there has been very little foreign inward investment since the Brexit referendum’
      Evidence please!

      Reply
      1. The Prangwizard
        January 24, 2023

        Why do we seek foreign inward investment? The answer is because we are bankrupt.

        The government and the Tory party keeps things going a bit longer like this but one day there will be nothing left to sell and enough foreign owners will withdraw soon when they realise there is no point in being here.

        How will the party explain then the personal poverty. But perhaps they won’t mind as they like being told by others how to behave.

        Reply
        1. glen cullen
          January 24, 2023

          Where does all our tax go !!!
          Highest tax ever …highest borrowing ever

          Reply
          1. a-tracy
            January 25, 2023

            2/3 of spending is on public services.
            The UK’s defence services,
            Health, Between 1955−56 and 2019−20, health increased from 7.7% to 18.5% of total spending. This rise was more than offset by a fall in defence spending from 20.9% to 4.8% of the total.
            Social Security – Universal credit, Disability benefits, State pension. (it has doubled as a share of GDP 5-10.8% since 1955.)
            Welfare and social services,
            Schools now up to 18 years and universities for a big 50.2% now go,
            Transport systems, inc rail subsidies.
            Prisons
            Financial support is given to other vital areas such as industry, sport, heritage and culture.
            Overseas aid
            Net debt interest
            https://ifs.org.uk/taxlab/taxlab-key-questions/what-does-government-spend-money

      2. hefner
        January 24, 2023

        It is not easy to find relevant reliable and recent information. There is gov.uk ‘Department for International Trade inward investment results to 2021’, 22/06/2021 (last result appears to be for tax year 2020/21’. Figures 1 and 2, and Table 2 appear to corroborate SG’s comment (with the proviso that they refer to the number of FDI-linked projects, not the $ or £ value of the FDI itself).

        Reply
        1. IanT
          January 25, 2023

          The Office for National Statistics (ONS) website has a lot of information if you want to plough through it.
          Try this link for instance (Sir John permitting)
          https://www.ons.gov.uk/economy/nationalaccounts/balanceofpayments/bulletins/foreigndirectinvestmentinvolvingukcompanies/2021

          Reply
          1. hefner
            January 25, 2023

            IsnT, thanks for that, the information imparted in 5 (glossary), 6 (measuring the data) and 7 (strength & limitations) are very useful.

        2. Mickey Taking
          January 25, 2023

          so in other words ‘evidence’ is at best difficult to find, relevant, reliable or recent.

          Reply
    3. Peter Parsons
      January 25, 2023

      Reports today place the UK 35th out of 38 OECD countries for levels of investment.

      Why is the UK so far down the list?

      Reply
      1. glen cullen
        January 25, 2023

        Because we’ve had a Labour government for the past 12 years

        Reply
      2. a-tracy
        January 26, 2023

        Peter, Wasn’t this specifically the North of England? Just shows Labour running the North; the Labour Regional Mayors and local labour bureaucracy can’t attract business; they’re more interested in spending money than making and attracting it. I wonder why that is; perhaps it’s because Labour doesn’t value enterprise.

        Rayner is more interested in flexible working to suit employees than what employers and their customers need to succeed. This is why the NHS is failing no one is answerable to the customers. They make the public feel that we need to grovel and thank them all the time when we are paying them to care for us.

        How many less ambulance drivers and paramedics are there in 2023 than there were in 2010?

        Reply
  18. Donna
    January 24, 2023

    I do quite enjoy reading Sir John’s efforts in trying to teach “Conservatism for Dummies” to the Blu-Green Socialists who have high-jacked the Conservative Party, but I’m afraid he’s wasting his time.

    They aren’t Conservatives and no amount of explanation will ever make them Conservatives. And the same applies to the Institutionally left-wing Civil Service; particularly the Treasury, which is on a mission to destroy self-employment since it consider the self-employed are all tax-evaders.

    Reply
  19. Walt
    January 24, 2023

    Sir John. I respectfully suggest that it’s time to ease off on the IR35 protests. I have first hand experience of companies seeking to engage me as a one-man business but on terms that, on careful reading, were a contract of service not a contract for services. Those companies wished to control the people they engaged but not to be liable for NIC, holiday and sick pay, etc. Some people wanted the work and accepted the terms; others, including me, did not. Those who did and the companies concerned should accept responsibility for their actions.

    Reply
    1. formula57
      January 24, 2023

      @ Walt – agreed, although the solution is for HMRC to charge the employing companies what they ought to have paid had own employee arrangements prevailed and leave the one man businesses alone (or perhaps being granted the benefit of the NIC retrospectively paid by the employer companies).

      Reply
  20. Berkshire Alan
    January 24, 2023

    Your post today John is spot on, we need more self employed people for the very reasons you state, but the State does not like or trust them, because they do not conform to employee to politicians thinking.
    Policies over the last 20 years or more have been designed to try and put the self employed in a box, and tie them down with red tape, regulations, tax and benefit changes and the like.
    During Covid, who were left out from help, the very people who try in normal times to try and help themselves, instead of them just being able to access help with a simple reference to their past tax paying record, they were shunned and refused, and instead bogus companies of which HMRC had no record and which were deliberately set up in a few days, in some cases by criminals, just to get Covid handouts, were given tens of thousands each, and surprise, surprise, the money has now gone , never to be repaid, and so have those Companies concerned.
    Stupid thinking, by stupid Government politicians, which has ended up costing the taxpayers £ Millions, and at the same time destroyed many self employed and small businesses.

    Reply
  21. agricola
    January 24, 2023

    I often get chastised by my partner for failing to follow white lines and painted arrows in car parks. My answer is that the two of us did not create the business we did by following the white lines set out by those who wanted the status quo perpetuated. We had vision and capitalised on doing things differently.
    I realise that many self employed are tied to the area and type of work they do. In my situation I was possibly one of the first to work from home apart from customer visits and lots of overseas travel. Were the same sort of business possible today I would move my home and incorporation to a much more tax friendly location. Life is short, why waste it on an unfriendly businesswise country where nothing within the control of government actually works for the benefit of the citizen. Said with 30 years of overseas travel and 15 years of living overseas experience, and a great deal of regret that a once great country has been reduced to its present state by an excess of incompitent politicians. I have only returned to support my partner, not for anything the UK has to offer. The UK offers third world living at a premium fee. All very sad because the British People are amongst the most inventive, generous, tolerant and most enterprising in this World.

    Reply
    1. agricola
      January 25, 2023

      You just don’t like the truth do you, well the ballot box looms, standby con-servative armagedon.

      Reply
  22. BW
    January 24, 2023

    So if it is acceptable to live off £35000 a year. Especially highly trained and dedicated people. Why to we pay MP’s £85000. There are no skill requirements, no experience necessary, no qualifications required, no educational qualifications needed, no training and certainly no common sense needed. Just look any some of them in there. I suggest it is the lack of necessary skills and immediate access to the ever deepening money trough and lucrative pensions only now available to MP’s that attracts the useless who have no skills to offer anywhere else. So why do we pay them £85000. It certainly isn’t to attract the best. It seems to draw in the worst.

    Reply
    1. Mickey Taking
      January 25, 2023

      But you are required to attend (sometimes) and join a queue to vote for the boss, shout ‘hear hear ‘ or wave papers, perhaps stand every few years to recite a question given to you by the boss’ deputies.
      It can be quite exacting.

      Reply
    2. a-tracy
      January 26, 2023

      Which MPs aren’t trained and dedicated? Who put them onto their selection lists?

      Reply
  23. Michael Saxton
    January 24, 2023

    There is one sure fired way to damage and destroy small businesses. Change IR35 rules, increase corporation tax and income tax. Yet this is exactly what the Prime Minister and Chancellor have done and this is a ‘Conservative’ government! Not only a spectacular own goal and gift for Labour it’s so difficult now to to see how the economy can grow?

    Reply
  24. Aaron
    January 24, 2023

    @walt. I too suggest Sir John ease off on IR35 complaints, and just treat it as an indicator that the government is anti-business while it is in place.
    Most tech companies have figured out how to arrange contracts under a statement of work, HMRC cest tool gives an outside IR35 result even if you have to use a clients IT system to deliver the service, and clients acknowledge suppliers need to conduct their own IR35 contract assessments prior to signing. It’s just yet more regulations and paperwork.

    The bigger issue is the tax burden for small companies in the U.K. means it is no longer appealing to contract here. it’s much better to contract and work in Europe or the Middle East, and repatriate the money earned back to the U.K. when needed.

    Yes, it’s a brain drain for the U.K. What did the government expect when inflation, energy prices and taxation all increased to silly levels? You can strike, and hope this somehow improves things, or you can find work elsewhere.

    I’ve not seen a policy from the current Sunak government that would indicate they intend on changing the economic landscape for the better. Perhaps Sir John could post an explanation on how the current government approach to economic management aligns with the 2019 manifesto and conservative values, and some reassurance that a vote for the conservatives in the next GE is actually going to change anything?

    Reply
  25. James1
    January 24, 2023

    The government “should revisit tax rules”. That’s certainly true. The problem isn’t that taxes are too low. Taxes are the highest for 70 years. The problem is that the government spends too much. The government is too big, too expensive and too intrusive. It needs to be cut down to size. It needs to stop trying to constantly ‘fix’ things, which it generally does badly. It needs to stop interfering. It needs to protect our liberties. That’s pretty much it. Just get out of the way and leave people the hell alone.

    Reply
    1. IanT
      January 25, 2023

      I agree James but unfortunately we seem to have developed a ‘dependancy’ State, perhaps encouraged by Covid Furloughs etc – but really it’s been growing for some time. Every problem has to be addressed by throwing public money at it. The Public don’t seem capable of linking ‘Government Spending’ with the fact that they ultimately have to pay for it. The Left waffle on about taxing the Rich but the (truely) Rich are mobile- they just up and off. Which leaves the rest of us ‘Not Rich’ to pick up the tab. As is becoming apparent, it cannot continue and hard measures will be required – but who will do it?
      Liz Truss found out that you can’t just lower taxes and Hunt is going to find out that you can’t just raise them. As any sensible person knows, you ultimately have to live within your means. The solution will be to cut back hard but that won’t happen until we are a lot more desperate than we are right now. As usual, our Leaders (Blue or Red) will leave it until it’s far too late. It’s easier to just kick the can down the road for the next lot to sort out.

      Reply
    2. Mickey Taking
      January 25, 2023

      the ‘nanny state’ keeps hiring more helpers.

      Reply
  26. Bryan Harris
    January 24, 2023

    Yes, the tax system should be used to encourage innovation, rather than what it does currently which is to destroy it.

    Only the very rich can manipulate the rules to pay less tax, demonstrating what a shambles the tax system is. If we had any sense we’d switch a lot more taxation to purchases, so that those with the money are allowed to feel good that they also support the Treasury.
    With a gradient increase on VAT for luxury items this change could easily be achieved while reducing taxes elsewhere.

    That said, the whole tax system should be rewritten to remove the loopholes and make it all simple – it’s far too complex and takes an age to administer!

    Reply
  27. formula57
    January 24, 2023

    It seems far distant (not only in time, alas) that the then Leader of the Opposition at short notice addressed a conference of small business owners and won them over with words to the effect that she understood the challenges and efforts and hard work needed to run a small business as she had seen what it took by working in her father’s shop in Grantham.

    Will we ever have a proper prime minister again do you think?

    Reply
  28. hefner
    January 24, 2023

    Yes, help the self-employed but make the capital gain tax rates the same as the income tax rates, encourage people to save for their pension but with only one rate for pension relief.

    As pointed out on gov.uk ‘Non-structural tax relief statistics (January 2023)’

    Reply
  29. RichardP
    January 24, 2023

    Perhaps if we had a tax system that the Chancellor of the Exchequer can understand it would encourage enterprise at all levels.

    Reply
    1. a-tracy
      January 25, 2023

      I’m Laughing out loud Richard.

      Reply
  30. RDM
    January 24, 2023

    There are things still in place from years back that could help clear things up.
    Confusing Sole Trader, Cash Book accounting, when (I believe) it is intended to be, the bare minimum(?) with the limited liability of a Limited Liability corp (PSC), that needs an Accountant?
    Simplify it.
    How does a Sole Trader protect their IP (Limited Liability)?
    Also;
    as soon as you take on a contract you have to deal with IR35 (Umbrella or PSC)?
    As soon as you employ someone, ‘to help’, you end up having to take on an Accountant, start a Pension, and run Software, Tools,…
    Fuel duty (Cost of doing Business)?
    Barriers to Entry?
    Being an Owner Driver, for example, has similar issues.
    Operators License when you only have one Truck? (An O License training is very expensive fleet management training, why? There is not even very much Customs training, as it keeps changing).
    Getting cheap, and acceptable, Operating Centre, Parking and Maintenance? There is no way to build it up, for one truck.
    And, for an Owner Driver to obtain an Operators License you have to pass the two exams, with 70%, ‘Fleet Management’? It’s not of use, or is it wanted!
    Asset (Deposits) prices.
    Rates?
    Simply Taxes they pay, but I would accept a ‘Fair’ amount?
    Could we lean off (simplify) capital accumulation, the whole point? OK, the problem then would be to earn enough, but some people would accept lower initial income, just to build up the capital. The real ‘but’ would be that there is such a large barrier caused by such large deposits (We have had huge increases in Asset Prices, and so Debt is difficult to get)?!

    And, from a holistic (Economy) point of view, the point would be to bring innovation and Flexibility to the clients.

    So, for example, hauling steel; If you can offer a heavier Net Weight, then you have a higher Payload, and become less of a “Price Taker”, and would allow the use of multiple clients, and to play one off against the other (Especially, within GB with it’s large steel industry, large number of clients).

    So much Red tape!

    Hope this helps?

    BR

    RDM.

    Reply
    1. a-tracy
      January 26, 2023

      RDM I hope John passes your comments on to the Transport Minister.

      Regulations favour the big foreign companies, they like to use subbies, they could assist more to make the training lower cost and available.

      Reply
  31. formula57
    January 24, 2023

    You have warned us hitherto about economic performance and low productivity. I was surprised though to see Tim Harford’s (economist, journalist and broadcaster) recent writing (“Is life in the UK really as bad as the numbers suggest? Yes it is”) to the effect that our economy is in “a generation long slough of despond” for real household disposable income has barely increased in fifteen years.

    The abnormality of this is shown, as Harford explains, by the contrast with a doubling of spending power every thirty years from 1948, being twice as high in 1978 and nearly so again in 2008, just before that year’s financial crisis. Today each of us would be about forty per cent. better off had the trend continued.

    Now apparently we are nearly back to pre-crisis levels but of course with punitive taxation and enormous debt burden and failing public services. We really cannot afford a government that is not up to the challenges we face.

    Reply
  32. Bert Young
    January 24, 2023

    Motivation and incentives are missing today – getting hold of any local tradesman is vastly different to what it was a couple of years ago . The economic climate is entirely to blame . The present government is at fault .

    Reply
  33. Bill Mayes
    January 24, 2023

    Seems to me that this pseudo-conservative government does not want any self-employed citizens to boost the economy. They appear to be falling in line with the Davos proposition to increase the size of government and to build an even bigger Corporate structure. Big government funded by even bigger corporations are the way to go? I trust not.
    It all sounds too much like “Big Brother” – removing the independence of the individual, dominating and over ruling all citizens with the new “Nanny State”.
    What happened to democracy here?

    Reply
  34. glen cullen
    January 24, 2023

    Its hard to imagine anything or any government instrument or action which has been beneficial to the self-employed
    Government high taxation haven’t helped, nor has government regulation, local regulation, business rates, BEIS, quangos, the policies of net-zero with ULEZ, higher insurance and environmental levies, fuel & energy costs
    Politicians are still getting paid the same before, during and after covid, not so for SMEs …most have lost half their incomes, most are still paying back covid loans and all of them have higher costs.
    This government doesn’t understand SMEs; this government is the enemy to SMEs

    Reply
  35. Ian B
    January 24, 2023

    Sir John
    “Help the self employed”

    Surely you cant be suggesting that the UK must encourage more people to be self reliant, stand on their own two feet and actually contribute to society. The UK for the last generation or more has through its succession of left wing governments managed to embed socialism into the psyche of everyone, more so the new generation. The Government isn’t threatened when it works on the principle of being a dictatorship the sole arbiter of ideas. After all Socialism is about us all being ‘in it together’ as long as you only do as as your leader tells you.

    As a society we cannot have people going off in their own direction and refusing to dance to the dictated doctrine of the WEF Establishment – heaven forbid the ideal of free will and thought. What sort of society would that create?

    The next thing you will be suggesting is the outmoded concept of a Conservative Party and one that is in Government.

    Reply
    1. glen cullen
      January 24, 2023

      Maybe that’s why our government is so quick to subsidise big business, green business, woke business …..they’ll never subsidise nor support the self-employed because they don’t follow the WEF model

      Reply
      1. Mickey Taking
        January 25, 2023

        but mainly because they are much harder to control.

        Reply
    2. David
      January 25, 2023

      We don’t have socialism. We have something different, we have all the signs that global bodies want to take over more and more. Indeed it seems that some MPs owe as much if not more loyalty to the WEF, Trilateral and/or others like it than they do to the UK electors. I refer to both sides of the Commons.

      Not JR, thankfully.

      Quite a lot of people I know have changed their mind and would not want to go back into the EU for this reason. The EU too seems to have been taken over by the WEF, especially for instance the Netherlands. The EU especially showed its true colours after 2020.

      Vanguard and Blackrock … socialist? Ha ha, how ludicrous. Like others, I see a trend away from small business and to corporate ownership or control. What evidence is there that Amazon is more efficient than other smaller booksellers? I know of none. Amazon certainly pays a lower tax rate though.

      Reply
  36. mancunius
    January 24, 2023

    ‘The UK needs more self employed people… who can go on to employ others’
    You have to be joking. I would never employ anyone in my business; quite apart from the financial risks of leave-claiming, employer NIC and the possibility they will accidentally or deliberately mess up client relations, it is increasingly difficult to find graduates with the skillset needed. As my clients are mainly on the Continent, potential employees would need to write perfect English (not a given among graduates these days) and speak and write three other languages fluently as a basic pre-requirement, as well as being willing to work long hours and meet exacting deadlines, as well as having the specialized techniques I sell. Such a candidate is not easy to find, and when found, despite the decent money on offer, like Bartleby the Scrivener, they’d ‘prefer not to’.
    Look at the benefits structure you and your colleagues have legislated for in Parliament, Sir John, and you can see why. An amenable lifestyle of a few hours in the employ at a ‘charity’ or donkey sanctuary by the seaside – or just doing nothing at all – obtains a comfortable existence that hard work does not.

    Reply
    1. mancunius
      January 24, 2023

      *exacting deadlines, and qualified in the specialized*

      Reply
      1. mancunius
        January 24, 2023

        and *employ of a charity* etc*

        Reply
  37. MWB
    January 24, 2023

    People might as well just get on the public worker gravy train. No need to worry about the economic cycle, guaranteed index linked pension, job for life, etc., etc.

    Reply
  38. glen cullen
    January 24, 2023

    Nation Grid control your heating and on/off switch
    Local Council pop-up road access barriers control your local movement
    EV car manufacturers control your driving speed and on/off switch
    Mayors ULEZs control your ability transit UK without funds
    Government increase taxation to fund & control your net-zero attitude
    Government allow cheap imports of energy, materials & goods to undercut, close and control SME business
    Innovative, inventive, entrepreneurial self-employed small business BAD – Global international big business GOOD ….We’re not sleep walking into 1984, we’ve arrived in 1984

    Reply
    1. Mickey Taking
      January 25, 2023

      Supermarkets control whether we eat home grown or imported food.
      Power Interconnector Companies decide whether we exchange supplies with other countries.
      USA control whether we can fly and use weapons on our military aircraft.
      GDPR controls your data strategy and security.
      Mike Lynch controls whether you can get to use trains which you own via your tax.
      Sadiq Khan controls whether you will pay to drive a car in London suburbs.

      Reply
      1. glen cullen
        January 25, 2023

        You’ve just made my day !

        Reply
  39. Ex-Tory
    January 24, 2023

    Abolish the pointless and ridiculously bureaucratic “Making Tax Digital” legislation.

    Reply
    1. glen cullen
      January 24, 2023

      Excellent …cash is king

      Reply
  40. anon
    January 24, 2023

    Keep it simple – combine NIC & PAYE. The contribution element is laughable as when claiming any contributory benefits, they extremely low,time limited. The state pension is also low for those that have actually paid full contributions.
    Everything else is means tested.

    So lets try a flat tax for paye/nic and micro-business, with a much higher pa circa £20k and (gross-up fro P11D purposes) tax all benefits & state fringes, subsidized housing etc. Allow a certain level of profits in sme to be untaxed if retained in the business if in say a cash reserve account.

    Reply
    1. a-tracy
      January 25, 2023

      They will do this, that’s why the personal allowance has been aligned, only one more step to go.
      This makes all those part-timers in a couple of jobs pay their NI; it also would increase the tax of the retired that continue working, the self-employed will be paying 12% NI. I don’t see it of any benefit at all to the work-force. Other than them totally removing the insurance element of the payment so they can means test the pensions that everyone is currently insured for. Be careful what you wish for it might just happen, detrimentally to all private sector PAYE workers.

      Reply
  41. a-tracy
    January 25, 2023

    John, please watch ‘The Bank of Dave’ if you haven’t already seen it.
    It’s a shame we can’t replicate Dave instead of your government’s banker mates.
    You want to know how to increase self-employment and enterprise, go to Burnley and visit with Dave.

    Reply
  42. margaret
    January 25, 2023

    Why haven’t the bloggers got the courage to use their own name . Im sure that they cant all be the Royal Family .

    Reply

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