Government has provided ‘scant justification’ for not addressing ‘hard edges’ of coronavirus support schemes that have excluded key groups of working people

Treasury Committee's third report on economic impacts of coronavirus includes call to amend fourth tranche of SEISS to support newly self-employed who missed out on previous support

The Treasury Committee has criticised the government for showing ‘scant justification’ for not addressing the ‘hard edges’ of its coronavirus support schemes that have excluded key groups of working people.

In the third report in its inquiry into the Economic Impact of Coronavirus - that examines the government’s plans to take the country out of lockdown and the gaps in the Covid-19 support schemes for individuals - the Committee highlights again the gaps in support it identified in its first report in June 2020, particularly for groups who have been excluded from the Self-Employment Income Support Scheme (SEISS) including people newly self-employed in 2019/2020, certain freelancers, directors or people with other earned income -

‘The first version of the SEISS scheme had to be rolled out at speed in March 2020. Partly because of that haste, there were ‘hard edges’ which meant that some people lost out. Though regrettable this is understandable. However, there is scant justification for not having addressed them eleven months later.

We recognise that it may not have been possible for the government to help all those who have fallen through the cracks of the support schemes. However, we are disappointed that the government has so far shown no inclination to expand or provide alternatives to the SEISS, which is providing a vital life-line to many but is not available to all those whom we believe should qualify.'

As a result, the Committee makes a series of recommendations to address the gaps in the scheme including that -

• HM Treasury uses new data from tax returns for 2019/2020 to help the newly self-employed who missed out from previous rounds of support for the fourth tranche of the SEISS grant (and that HMRC should prioritise analysing 2019/2020 tax returns to help the newly self-employed who missed out as quickly as possible);
• HM Treasury should investigate ways to support limited company directors, in part to ensure that it is not sending out the message that it does not support entrepreneurs and employers who have suffered significantly from a lack of support;
• the government reconsiders the 50 per cent minimum self-employment income limit in the eligibility criteria for the fourth tranche of the SEISS grant so those who derive less than half of their income through self-employment - including freelancers who have missed out on support - can receive some level of support; and
• the government looks at other models of support, including those developed by the devolved administrations with a view to extending support to people who require support and who do not currently qualify.

Commenting on the recommendations to address gaps in support, Treasury Committee Chair Mel Stride said -

‘Nearly a year on from when the government first introduced coronavirus support schemes, those who have been excluded must not be forgotten.

New data from the 19-20 tax returns should be used to help the newly self-employed for the fourth tranche of the SEISS grant.

We have also made recommendations for how the Treasury should help those limited company directors and freelancers that have fallen through the gaps in support.’

For more information, see Government must set out how and when it will lift lockdown restrictions with economic and epidemiological modelling to support it from parliament.uk