Self Employment

Review recommends more support for self-employed people

22 February 2016

A government sponsored review, carried out by high profile entrepreneur Julie Deane, has concluded that self-employed workers should receive more support when it comes to maternity pay and support with adoption.

Julie Deane OBE, an entrepreneur who grew The Cambridge Satchel Company from a kitchen table business into a business turning over £10 million and employing 130 people, was commissioned by the government to investigate the opportunities and challenges facing the self-employed.

Around 900 people responded to a consultation and Ms Deane personally spoke with dozens of organisations and business owners from across industries.

The starkest findings in her report relate to self-employed people starting or seeking to extend their family.  In particular she highlighted maternity pay and support with adoption as an area where the self-employed were treated differently to their peers in traditional employment. 

“In considering the evidence I have not been able to find a compelling explanation for this difference in treatment, and looked at objectively it seems that there is a fundamental principle that the self-employed should not be treated any less favourably than employees where they are planning to start or extend their family,” she said.

Deane also highlighted the need for more ‘flexible financial solutions’ like mortgages and pensions, noting that self-employed people often have trouble accessing these financial products

However, even despite the mismatch in paternal support, self-employed people generally reported being happy and successful, with very few wishing to return to the world of traditional employment.

When trying to disentangle the motivations for more and more people choosing the self-employment route, survey evidence found that 87 per cent of respondents listed positive reasons as the motivation.

Motivations included: earning more money, fulfilling personal ambitions, meeting social needs and continuing to work after retirement. But, according to Deane, by far the most common response was: “the freedom, flexibility and independence that being self-employed offered them compared to working for someone else”. 

Prime Minister David Cameron reacted positively to the review’s findings indicating some desire to act on the recommendations.

He said: “Up and down the country there are millions of hard-working self-employed people and I want to make sure they get all the support and security they need to achieve their ambitions.

“We’re already helping with tax allowances, start-up support and with our ongoing commitment to cutting red tape, and given Julie Deane’s experience of starting her own successful business, she was the ideal person to shine more light on the needs of self-employed people.

“I’d like to thank Julie for her hard work in delivering this Review, and her wide-ranging recommendations will be carefully considered.”

Miles Grady, Director of Umbrella.co.uk was hopeful that the findings would translate into positive action from the government.

He said: “This is a very insightful report from someone who has obviously been through a lot of the same challenges facing small business owners on a daily basis. At a time when more and more people are choosing self-employment, Julie Deane has made a compelling case for better maternity rights and flexible mortgages.

“I urge legislators to take her advice seriously, and I hope that her suggestions also contribute to the broader debate around self-employment benefits, taxation and IR35.”