Jesse Norman Update

An update from England from Sonali Joshi, Director of ExcludedUK, 10th December 2020

 

Apologies for keeping you all waiting a bit for this update from today’s meeting with Jesse Norman.

 

Firstly, the fact that this meeting happened is a huge positive. We’ve worked tirelessly to reach this point where are voices could be heard by HMT. Yes, it’s taken months, but the important thing is that we got here and we’re being listened to.

 

The meeting was arranged through the APPG and along with 5 other groups – Refused Furlough Support Group, Maternity Petition represented so powerfully by our very own Bethany Power, Forgotten PAYE, New Starter Justice, and Forgotten Ltd/Annual PAYE, we had 3 minutes to present our case and potential solutions. 5 mins was knocked down 3 mins at the last minute so it was tough!

 

There was so much I wanted to say, as I’m sure others felt too, and I simply had to trim my presentation down in every way I could. So this was not an exercise in presenting all the different exclusions, but to make the case that something needs to be done for all those affected. I took a few exclusions as examples to complement all the other groups that had spoken before me as I had to go last.

 

We put forward a 3 stage proposal based on many conversations we’ve had with MPs, the metro mayors, industry bodies, unions, think tanks and individuals – a broad brush proposal that we intended to align with other groups so we are all speaking with one collective voice in order to aim for the best possible outcome for all – and that has been our goal from the very outset.

 

An overarching proposal entitled the Targeted Taxpayers Support Scheme – TTSS, was put forward by the APPG which essentially would use HMRC as the mechanism for issuing grant payments. This is completely in line with what we proposed – we’ve put forward exactly the same idea. All of this came together really quickly this week, so TTSS is still very much being formulated by the APPG, but we know from John Glen’s speech at the Westminster Hall Debate that he read our briefing paper where we set out our 3 stage approach and has passed it to his department for consideration, and I’ll be following up on this imminently.

The one element that set our proposal apart was the first stage of our approach: a call for an immediate payment of £2,000 to give people something at this most critical time of the year. We based this figure on the average pre-Covid monthly income from our latest survey – we had to have some justification for this figure and this was the most logical.

 

The tone of the meeting was positive and most importantly we are expecting a follow up meeting after the APPG have put forward a proposal for the Targeted Taxpayers Support Scheme in consultation with ourselves and the other 5 groups. Our first stage call for an immediate payment has to go before that and so we will be pressing this further immediately.

 

Here’s what I said – please bear in mind I had to edit as I was going along because I had to cut out 2 mins so I had to remove so much of what I wanted to say!!

 

“ExcludedUK is a volunteer-run organisation, formed to raise awareness of all categories of exclusions in the government Covid-19 financial support schemes affecting individuals and businesses.

When the Chancellor announced the schemes in March, it soon became apparent that financial support would not reach all in need in the face of the extraordinary challenges presented by the pandemic.

Based principally on HMRC and ONS statistics, alongside other sources and the Treasury Committee report of 15 June, ExcludedUK and other organisations estimate 3 million UK taxpayers have been affected. The recent National Audit Office report arrived at the figure of 2.9 million.

The Chancellor has disputed the 3 million figure, recently referring to 1.5 million whose self-employment is less than half of their income, stating they could therefore benefit from the furlough scheme. Firstly, those excluded are not just 1.5 million self-employed with more than 50% non-trading income from PAYE employment and cannot ask a past employer to furlough them, contrary to the Chancellor’s suggestion. Furthermore, as we’ve just heard, many other categories of exclusions exist across all employment statuses.

The Chancellor also referred to Universal Credit being able to make up the difference, yet the data suggests many simply cannot access it.

Some exclusions may have been oversight, others appear to have been policy decisions, yet without clear rationale, with arbitrary hard edges to eligibility criteria, creating huge disparities, while welfare has not provided a safety net.

Close to 9 months have now passed since the schemes were announced – there has been ample time to address these exclusions, and there is still time.

The overriding call from those affected is parity of support.

Those affected come from all walks of life, diverse socio-economic backgrounds, all employment statuses and industries, all contributing significantly to the UK economy; some unfairly impacted due to personal circumstances: maternity or parental issues, those affected by pensions – sometimes widow’s or army pensions, bereavement payments, carer’s allowance, redundancy, shielding and more.

ExcludedUK has received over 5,000 testimonies which clearly illustrate the profound impacts of being excluded which are only becoming more acute as time passes:

· increasing financial hardship

· mounting debt

· an increasingly severe mental health crisis

· people relying on savings and pensions, decimating their future financial security

· relying on family

· food banks

· losing their homes

These impacts also extend to families and households.

Furthermore, with the suggestion of potential future tax rises, those who’ve been excluded may face a double blow.

 

You’ve just heard various suggested solutions and we recognise flexibility is needed, hence we’re advocating a 3 stage approach, which can work in tandem, if not encompass the proposals we’ve heard today and which in essence echoes the Targeted Taxpayers Support Scheme:

1. an urgent one-off payment of £2,000 for everyone excluded from meaningful support. As we approach Christmas, this will provide immediate assistance at this critical time.

2. a forward facing new monthly arrangement while tiers and restrictions remain in place in complete parity with the calculations in the existing schemes

We equally propose using HMRC for payments – a straightforward mechanism, able to avoid fraudulent claims and reclaim over-payments.

I would just add a few further points to eliminate eligibility criteria:

· the requirement for a minimum of 50% trading profits should be removed, which, as mentioned, has involved some grossly unfair factors relating to personal circumstances

· the £50,000 threshold: tapering can be implemented to eliminate this cliff edge

· new businesses should be eligible

· regarding the newly self-employed, I’d like to refer to Martin Lewis of Money Saving Expert’s pertinent comment in yesterday’s Treasury Committee hearing. The newly self-employed exclusion often goes hand in hand with the 50% trading profit from self-employment exclusion, and thus only those who set up business before October 2018 are covered, essentially excluding those who set up their business in the last two years. The fourth income support grant is due in February, after the 2019/20 tax return filing deadline, so totally feasible to be taken into account for SEISS

3. we propose discussing backdating payments for a full and final settlement to deliver parity and fairness

While we’ve heard various suggested solutions, most importantly something must be done.

By providing this much needed support, these affected individuals will be able to play their role in the recovery – not least by clearing debt and helping affected businesses emerge from the crisis in the best possible shape, while equally serving as vital investment for future national economic recovery and growth.