Rishi Sunak has extended support to more self-employed people who had previously missed out on help.
The Chancellor said more workers who became newly self-employed during the coronavirus pandemic will be eligible for Government support.
However he confirmed a strict deadline as he unveiled the change, alongside his furlough scheme extension plan in the Budget today.
He outlined plans for two more grants to be made available to the self-employed in April and the summer.
But the fifth and final grant will be available in full only to those whose profits have fallen by 30% or more.
Mr Sunak told MPs more than 600,000 people – many of whom became self-employed in 2019/20 – will now be able join the more than two million people eligible for cash grants.
He also confirmed details of a fourth and fifth grant from the Self-Employment Income Support Scheme (SEISS), which will be available to claim from April.
But unions representing the self-employed say the support is being cut short earlier than promised – and the creative industry has been left ‘in the cold’ once again.
Embroiderer to the royals Chloe Savage today told she fears losing her home, after receiving scant support from the Government.
The expert needleworker who worked on Meghan Markle and Kate Middleton’s wedding gowns told how she will never vote Tory again due to their handling of self-employed workers.
How will the latest grants work?
The grants will only be accessible to self-employed people who had filed their tax return by midnight last night, Mr Sunak told the Commons today.
The fourth grant will be worth 80% of three months’ average trading profits up to a £7,500 cap, according to the Budget.
That grant will cover the period from February to April and can be claimed from late April.
The Chancellor also confirmed details of the fifth and final SEISS grant which will be available over the summer.
It will cover May to September and will depend on the self-employed business’s recovery.
Those whose turnover has fallen by 30% or more will continue to receive the full grant worth 80% of three months’ average trading profits, up to £7,500.
Those whose turnover has fallen by less than 30% will receive a 30% grant, capped at £2,850.
The final grant can be claimed from late July, with further details to be published later, the Budget says.
All other eligibility criteria will remain the same as the third grant with further details yet to be published, the Government said.
The value will be determined by a turnover test to ensure that support is targeted at those who need it most as the economy reopens, the Budget says.
Mr Sunak’s Budget also outlined continued support for people in need of direct income support.
The government is extending the temporary £20 per week Universal Credit increase for a further six months.
It also confirms a one-off £500 payment of Working Tax credit to those eligible.
‘Left out in the cold’
The government says it has supported 2.7 million people through the SEISS scheme, with claims totalling £19.7billion so far.
But organisations representing self-employed people have raised questions over the plan.
The union Prospect, which represents 30,000 freelancers and self-employed said Mr Sunak’s plan fell short after he promised the SEISS would run to September.
The final grant of the SEISS only provides three months’ worth of help, stretched over five months – meaning the scheme effectively ends in July, Prospect’s general secretary Mike Clancy, said.
He added: “This Budget hides yet another sleight of hand for self-employed workers.
“Despite promising to help freelancers, today’s announcement means that financial help for self-employed workers will run out two months before support to employees.
“Throughout the crisis the self-employed have been treated as second class citizens, and this Budget continues that approach with less support, more red tape, and the continued exclusion of many thousands.
“Fully backing the self-employed is not only a moral imperative, it makes sound economic sense to secure the recovery. Unfortunately in this Budget the Chancellor has given with one hand and taken away with the other.”
Association of Independent Professionals and the Self-Employed (IPSE) chief Derek Cribb thanked the chancellor for listening to freelancers’ concerns and extending SEISS.
He added: “However, we also urge the Chancellor to look again at groups such as limited company directors, who are still excluded from SEISS.”
The extension of the Job Retention Scheme and the Film and TV Production Restart Scheme were the only bright notes in a largely disappointing picture for creative industry workers, their union Bectu’s head Philippa Childs said.
Many thousands of freelance creatives were yet to receive a penny from SEISS, she said.
She added that his Budget left creative industries heavily reliant on freelancers and self-employed contractors “out in the cold” once again.
Ms Childs said: “The arts industry risks losing millions if they are hit with closures or delays this summer, which is exactly what happened in December.
“It’s not too late to announce a scheme, but the Chancellor needs to act fast or he risks an avoidable delay to the planned reopening of the arts this summer.”