The boomerang budget

The boomerang budget


Philip Hammond surprised many Tories by lashing out at the self-employed not only with the extra national insurance, which was on analysis not that material, but with the polemics that came with it. Having praised the chancellor and his boss in the past for apparent pragmatism, it seems a little hypocritical to have a go about the U-turn. The damage has already been done in the language of alienation, accusing the self-employed of seeking unfair advantage.

The main unfair advantage is of course no security of employment, but the most visible is the fact that holidays are unpaid. There is the additional advantage of no job-related pensions. Other advantages include unlimited HM Revenue & Customs policies skewed to the taxpayer’s disadvantage. If you make a mistake you’ll be hit with interest and penalties; if the revenue makes a mistake they won’t even pay your costs. The chancellor and the prime minister sounded so crass as they tried to justify this absurd ivory-tower assault on common sense, it’s actually quite hard to get worked up about it.

What’s really worrying is not that they backed down, which was sensible, and in the context of the extent of the cock-up almost admirable, but how hopelessly out of touch they are with life as it actually is for the massed ranks of the UK’s self-employed. The mandarins of Whitehall see themselves as feudal overlords from the sybaritic palaces that you have paid for, with gilt-edged pensions that your children will finance. They hate the self-employed because we are perceived to be outside their rotten decaying corrupt self-serving bureaucratic system. Don’t kid yourself that the European Court of Justice was another layer. Surely our intelligent readership didn’t buy that one. The ECJ was a powerful and effective check on the abuses of our own government. Brexit has just signed us over to the modern equivalent of Jacobite absolutists, or worse, Norman conquistadors.

A rant needs a little case study. Let’s get really personal: the daughter of one of our partners here at DSC Metropolitan. She’s a contractor in the public sector. From 6 April 2017 all government authorities using contractors will need to decide whether those contractors are caught by IR35 or not. IR35 has been around so long you’re probably familiar with it, but essentially if you think you’re self-employed, which the government has just spelt out in the budget it hates to the point of phobia, HMRC can pretty much arbitrarily decide you’re not.

These authorities neither have the time nor the inclination to decide in favour of the contractor. If subsequently they’re proved to be wrong, the department will be liable for the PAYE/NIC. Will any civil servant take that risk? Of course not; everyone will be treated as caught by IR35. When was a public official last fired for procrastination?

How would you feel, or perhaps you are just about to feel it, if someone took 35% out of your pay-packet next week. Permanently. It’s a disgrace. Not the government but you and me for letting them get away with it.

What will actually happen is that either the contractors will leave or put up their hourly rate. In either case the government has shot their department in the foot. But before we end on that high-note of schadenfreude, government is judge, jury and executioner in these circumstances. The British courts are craven; so’s the House of Lackeys. Shed a tear for the ECJ, as having experimented on their own subcontractors, how long before they turn their misguided venom on the private sector? Bring me my pin-striped tights. I’m off to Sherwood Forest.

Doug of Loxley and Little John Handley continue to rage against the state from the Forest of DSC Merry Metropolitans

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