A Lewisham cabinet member has asked the Government for more income protection for the self-employed during the coronavirus outbreak.
Cllr Joe Dromey, member for jobs and skills, arranged a cross-party letter to the Chancellor of the Exchequer, with signatures from cabinet leads across 23 London boroughs.
Last week, Chancellor Rishi Sunak announced the Government would pay 80 per cent of workers’ wages who are unable to work because of the Covid-19 crisis, covering salaries of up to £2,500 a month.
In the letter councillors welcomed the “unprecedented” move but asked that Mr Sunak take urgent action to “protect [self-employed] workers and their families from hardship” as they were not offered the same funding support.
The letter warns that many workers will be forced to go on universal credit, and in a recent poll, nearly half of self-employed people said they would risk going to work even if they had coronavirus symptoms “just to make ends meet”.
According to the letter: “We wanted to welcome the unprecedented measures you announced last week to protect jobs and incomes.
“This will go a long way to minimise the economic impact of this crisis. But we believe more needs to be done to protect the self-employed.
“There are five million self-employed workers nationally. The capital has the highest levels of self-employment, with nearly one in five workers – 860,000 in total – being self-employed.
“Most self-employed workers are not well off; recent research by the Social Market Foundation shows that half (49 per cent) are low paid. Many have little to fall back on in difficult times.
“Many of these workers will be facing a significant drop in income as a result of crisis that is completely out of their control.
“Many face being torn between following Public Health England’s advice on social distancing, and going out to work in order to help ends meet.
“A poll by RSA last week found that nearly half (47 per cent) of self-employed workers would continue working because of income fears even if they had symptoms of coronavirus.
“We need to ensure that these workers are protected, and that they are able to do the right thing.”
It said the Government’s plan to pay 80 per cent of wages was “generous and welcome”.
But added: “While there were some measures announced to protect the self-employed, there is no guarantee to protect their income.
“This will leave many self-employed workers having to fall back on Universal Credit, which will be just £408 a month.
“Improving the offer of support for the self-employed during this crisis would help protect these workers and their families from hardship, it could help prevent the spread of the deadly virus, and it would sustain demand in the economy, enabling us to make a rapid recovery once the virus is beaten.”
Cllr Dromey said: “We welcome the measures taken by the Chancellor last week to protect employees and limit the rise in unemployment from the coronavirus crisis.
“But we need to see urgent action to protect the income of the self-employed.
“We know that many of the 29,000 self-employed workers in Lewisham are facing a significant drop in income from a crisis that is completely out of their control.
“We are calling on the government to protect these workers and their families from hardship.”
A HM Treasury spokesperson said: “The Chancellor has outlined an unprecedented package of measures to protect millions of people’s jobs and incomes as part of the national effort in response to coronavirus.
“This includes strengthening the safety-net for the self-employed who will benefit from a relaxation of the earnings rules for self-employed claimants under universal credit and deferring income tax self-assessment payments due in July 2020.
“We have always said we will go further where we can and are actively considering further steps.”