Self-employed IT consultant Matthew Searle at home in Burnley, Lancashire © Asadour Guzelian
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Philip Hammond’s announcement that he plans to raise national insurance contributions has worried some Conservative MPs, who fear it targets the kind of people the government had pledged to protect.

Mr Hammond says taxation on the self-employed and employed should be more closely aligned, and that his changes make the system fairer. But the move has angered a number of self-employed workers in a wide variety of professions and on different incomes.

The changes will hit 2.5m self-employed people with a rise in national insurance contributions of an average of £240 a year. However, that average disguises some big differences in the impact of the chancellor’s proposal.

Matt Searle, IT consultant from Burnley

Matt Searle left a big company in 2006 to become self-employed. He thinks he will lose about £600 a year from the tax changes.

“It’s not fair — the self-employed create £100bn a year for the economy,” he said. “I heard the chancellor on Radio Four saying it is only 15 per cent of the workforce but that is millions of people.” Mr Searle, who has incorporated himself as a business, earns less than the £43,000 limit to pay higher-rate tax. 

Politicians did not appreciate the risks the self-employed take, he said. “A few years ago I was out of work for seven months. I didn’t get unemployment benefit or income support. I paid for myself out of my savings.” He said he had been called up for jury service three times. As an employee, his boss gave him two weeks’ paid leave; the last time he sacrificed two weeks’ earnings. 

A “lapsed Liberal”, Mr Searle said no party appeared to care for the self-employed except the UK Independence party, which he would not vote for. “No party is on our side.”

Phillip Taylor, barrister, London

Phillip Taylor, a barrister at Richmond Green Chambers, describes himself as “the white-collar version of the white van man”. When people think of the self-employed, they tend to think of tradesmen or taxi and minicab drivers, he says, But “virtually every member of the bar” will also be affected by the chancellor’s decision.

Mr Taylor thinks his tax bill will go up by about £240, which may mean he will have to slightly increase his fees. But he says the policy will be a bigger problem for the “young bar” — new barristers paying off student loans and trying to build up their expertise.

As a Conservative supporter, he is also worried about the response the policy will provoke on the doorstep. White-collar barristers and white van men alike are often Tory voters, he says. “We are a low-tax party . . . you don’t bite the hand that feeds you.”

© Mark Pinder

David Watson, plumber and builder, Gateshead

David Watson, who runs DAW Building and Plumbing Services, has been self-employed for ten years. Twelve-hour days on site plus evenings spent preparing quotes — and paperwork at weekends — regularly add up to 70-hour working weeks. He thinks the national insurance change will cost him about £240 a year.

“It’s the way they chase after the small folk,” says Mr Watson. “There are huge companies out there who don’t pay anything — they get away with it . . . They can pay top dollar for good accountants to get round it.”

Once overheads, including subcontractors’ wages, materials, his van and insurances covering public liability and sickness are paid, he earns about £35,000 a year gross, before national insurance and income tax.

The chancellor’s justification for the national insurance changes based on self-employed people’s entitlement to the state pension rings hollow for Mr Watson. “Anyone under 45, if they think they’re going to get a pension off the government when they’re 68, they have another thing coming.” He pays monthly into a private pension.

The chancellor’s move will not affect the way Mr Watson votes — “I’m a Labour man” — but he did think breaking the manifesto pledge could hit the Conservatives politically. “They can’t say something two years ago and then change it.”

Uber driver James Farrar © Charlie Bibby/FT

James Farrar, Uber driver

There is only one option for Uber driver, says James Farrar. They will have to work longer hours.

Uber drivers are the quintessential “gig economy” workers, part of a new wave of self-employment that is troubling the Treasury and is sparking a string of legal battles. One of the common features of online platforms such as Uber and Deliveroo is that the workers are not able to set their own fees. “What is the variable left for the driver? Work more hours — and that’s how they’ll have to fill that income gap,” Mr Farrar said.

An Uber driver working for £7.50 an hour and putting in a 48-hour week — which he believes is the average situation — would have to pay an additional £68 a year under the change, Mr Farrar says.

Mr Farrar is the Uber driver who took the US company to an employment tribunal last year, arguing he was not in fact an independent contractor but a “worker” owed the minimum wage. He won his case but Uber is appealing against the judgment.

In the meantime, Mr Farrar campaigns on behalf of drivers via the United Private Hire Drivers trade body.

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