Iain Dale 7pm - 10pm
Self-employed say Rishi Sunak's winter economy plan offers 'no help at all'
24 September 2020, 16:45
Small business owners have told LBC that the government's new winter economy plan offers them 'no help at all', with one saying she is 'more worried now that she was in March'.
Announcing his 'winter economy plan', the Chancellor announced further support for self-employed people and revealed that the self-employed grant scheme is set to be extended.
Chancellor Rishi Sunak said that the Government will cover up to 22 per cent of the earnings of self-employed people after the current scheme, which covers 80 per cent of earnings, runs out.
An additional second grant will also be available for self-employed workers to cover February 2021 to the end of April - but the amount of this has not yet been confirmed.
He also promised to defer income tax self-assessment, a measure that will be "of particular importance" to self employed people.
But critics have said the help misses out around 1.5 million people who are self-employed and today's announcement has been met with mixed results, with some small business owners saying they are "scared, angry and frustrated" with the new system.
Nikki Collier from Binis Babies boutique in Halstead told LBC "nothing the chancellor announced today has helped" and at this rate she "won’t be there at Christmas" and might lose her house.
"I'm more worried now than I was in March," she said.
"None of what he said, is actually bears any resemblance to my small business.
"I'm not in the job retention scheme. I'm not VAT registered to so having any delay to paying VAT back or reducing it or whatever mechanism is in place doesn't relate to me, the loan extension doesn't relate to me or to a small business.
"Because at the moment, I am unlikely to be here at Christmas, which means that if I have no money coming in, I cannot pay my mortgage, I lose my house.
"I'm single, I don't have anybody else to support me, and I am more worried now than I was in March.
"I'm keeping going, I'm just earning the bit of money that I can earn to to probably feed myself and pay my household bills.
"I'm really not sure how long I'm going to be here."
Matt Badenoch, a wedding photographer working in in Oxfordshire and London said that the new announcement has made him "angry and frustrated".
He explained that as a limited company owner, he will get no government support.
"Right at the beginning he said that all self employed people would be covered. But then he went on to say that it's the scheme is going to operate under its current terms, which means limited company owners like myself are going to be excluded again.
"It's so frustrating, I can't emphasise this enough that I am self employed - when I fill out my tax return to HMRC, the government titles me as self employed.
"The only reason I moved from being a sole trader to a limited company is because I listened to experts, accountants, ministers, mentors, and they all told me that you set up a limited company to protects yourself."
But despite listening to the experts and registering as a Limited business, he says he is now being "penalised" for it.
"I didn't get any of the support last six months, and I'm not going to get it for the next six months," he added
"And I work in a wedding industry, which has been completely devastated by this pandemic.
"We had about one month of weddings in August, we allow 30 people and then as of this Monday, that has also now been restricted down to 15 people which means people don't want wedding suppliers to come in when they've got so few people.
"Most of them are just postponing weddings altogether or cancelling them."
David, a DJ from Kent, told LBC that he is "practically self employed" and only paid for the gigs he does.
He explained that nothing the chancellor has announced today will be of any help to him.
"While I appreciate the support I have received in the form of a bounce back loan, this is only a temporary fix in helping cover my expenses.
"I've had zero income since February, and I am now in debt and will need to pay it back with interest when i have no income and no idea when business will pick back up.
"Rishi Sunak's announcement does not fill me with confidence as the solution seems to be to offer me another loan which will drive me further into debt for something that isn't my fault."
The stark realties of what small business owners are being faced with was explained by a pub owner who spoke to LBC.
Clive, from Blackwood in south Wales, told Shelagh Fogarty that he opened back up in July and he cannot apply for any loans or any financial assistance as "he opened the pub earlier this year and no one is opening new bank accounts."
"We've got to pay for all of the PPE, the screens, the sanitising stations out of our own pockets, and now we've been told we have got to close as 10pm. With table service as well, that means we have to employ another three people, which costs almost our total takings in extra wages," he explained.
"It just feels as though we are banging our head against a wall."
Another self-employed worker Richard told Shelagh that his work has completely dried up as a children's party magician.
"We could not access the furlough scheme, but because my wife works three days a week we are also not entitled to universal credit.
"We've had no help from the government, so I rang the bank this afternoon after Rishi Sunak's announcement to see what could be done.
"There advice to me was just 'get a career change'. I'm a 50 year old magician who has done nothing else my own life. It's just disgusting.
He continued: "They will pull the rug away because i've hit my overdraft limit and I have no idea what to do.
"I've just been living off my credit card and overdraft and now I'm at the point where they are all maxed.
"You just get no help from anyone."
However, some small business owners have praised the government's plans, saying the self-employed need this support and may be able to start making up for lost revenue.
Ritchie, a wedding photographer from County Durham, told LBC that the announcement is "great news" and a bittersweet relief after new Covid rules cut wedding guests down to 15 earlier this week.
"It's a massive help, it will never replace the money I have lost with weddings, but it just takes the pressure off a bit.
"At least it means that I can pay my bills here, and try and think of other things to do to make some of the lost revenue up that I've lost.
"It just keeps things running. The worst thing that could happen is if you couldn't pay your bills, and then your business is gone, and you could never come back really once that happens.
"It's such a help and so needed. I had a full diary for the whole year before the announcements in February and since then, I've only done one wedding.
"And I think I've got maybe three to do after that. So it's a massive downscale of what was planned for the year.
"It's taken a little bit of pressure off, it means that I can maybe focus on trying to do some other stuff in my studio to try and make up the loss along with the grant side. It takes the pressure off a lot.
When asked how he felt when he heard about the support, Richie said: "It was it was like watching the football team score. The winning goal in the FA Cup finalists, I know that sounds daft, but I have been so worried about it."