Press Release – 29 September 2020

Sarah Owen MP slams massive government cuts to support for the self-employed through the pandemic

Luton North’s Labour MP Sarah Owen has told the Chancellor Rishi Sunak that self-employed people in Luton urgently need him spell out how he plans to ensure security for them through the rest of the covid-19 pandemic, after he announced last week a new grant which will only cover 20% of people’s incomes, a massive cut compared to 70% covered earlier in the pandemic. The Luton North MP has revealed that a swathe of worried self-employed people in Luton North have contacted her asking for certainty following the Chancellor’s launch of his Winter Economic Plan last Thursday.

The Chancellor Rishi Sunak announced his original package of measures in the spring. Originally, if self-employed people suffered a loss in income, a taxable grant was paid to the self-employed or partnerships, worth 80% of their profits up to a cap of £2,500 per month. Self-Employment Income Support Scheme (SEISS) was open to those who were trading in the financial year 2018-2019 and who planned to continue doing so, but whose business had been hit by coronavirus. Help was initially given as one lump-sum payment which was supposed to cover three months. Over the summer a “second and final” payment was announced covering 70% of profits, up to a cap of £2,190 per month for another three months – £6,570 in total. Some 2.6 million people were given at least one of these payments.

The Chancellor’s Winter Economic Plan included a new support grants for the self-employed, which will cover 20% of average monthly trading profits, paid out in a single instalment covering three months’ worth of profits, with a limit of £1,875 in total. This represents a substantial cut in support compared to the previous 70% of profits being covered. The second grant will cover a three-month period from the start of February 2021 until the end of April, but the amount has yet to be set.

In an urgent letter to the Chancellor, Ms Owen called on Sunak “to urgently announce what action your government plans to take to support those who will now experience a really steep fall in support but for whom business is nothing like back to normal.” She called out the deficient nature of his is plan, and restated her calls for targeted support for the sectors and workers who need it most.

Labour, led by their leader Keir Starmer, is calling on the government to make public what it plans to do for those who will experience a really steep fall in support but for whom business is nothing like back to normal. Labour has said throughout the pandemic that these interventions should be targeted to where they are most needed. Frustration has also been expressed that government has had months to get the design of this scheme for the self-employed correct.

The Luton North MP has been one of the loudest voices in Parliament for measures that will save as many jobs as possible, with her recently joining forces with Luton South’s Rachel Hopkins to warn the government that time is fast running out to save thousands of local Luton jobs from the ongoing impact of the pandemic, especially at the town’s beleaguered aviation firms.

As of Sunday 27th September, the total number of coronavirus cases in the borough stands at 2,054, representing a rise of 28 compared to the previous day.

Luton North’s Labour MP Sarah Owen commented:

“It is sadly going to take a long time for many workers and businesses to recover from this pandemic. Self-employed people are workers too and are too often forgotten by government.”

“I’ve had a huge number of people get in touch with me over the last week about the government’s cut in support for the self-employed. These people are grafters. They’re our town’s taxi drivers, builders, free lancers, local artists and entertainers who are really worried about what the next few months will bring.”

“I’m going to carry on lobbying the government to announce what their plan is going forward, because such a massive cut in support from 70% to 20% will leave some families in Luton struggling to put food on the table. These are people who work hard and have done the right thing during this pandemic, and we all know how tough it’s been.”

“As a Labour MP, I believe in a simple principle. When you’ve worked hard and paid into the system, your government should be there for you when you need it. This current government might be willing to now walk past you at your time of need, but a Labour government certainly wouldn’t be.”

Please see attached for a pdf and jpg copy of Sarah’s letter to the Chancellor Rishi Sunak