Chancellor Rishi Sunak’s package to help the self-employed through the crisis period has been cautiously welcomed, but freelancers warn a delay until June could be devastating for many self-employed workers.
Yesterday the government revealed that freelancers who earn £50,000 or less in average annual profits and are adversely affected could receive up to £2,500 a month, or a maximum of 80 per cent of earnings.
The size of the financial support has welcomed by PR freelancers and industry bodies.
Bonfield Marketing’s Jenny Procter, a sole trader with three years of accounts under £50,000, said the package will help.
“[It] will give me the confidence to continue working with other small businesses that support me – my web designer and podcast editor, for example,” she said.
“As a whole, I hope the Chancellor’s support package means that many businesses can have the confidence to plan for the future, and to continue employing the freelance talent they will need to help them grow.”
A snap poll in the wake of the announcement indicated that a significant proportion of self-employed comms professionals will not be as fortunate.
Of the 100 PR freelancers polled, 62 said they would not be eligible to receive the support. This means they have either earned too much profit or have not filed a tax return.
The PR Cavalry founder Nigel Starbutts, who conducted the research, told PRWeek: “This is not the relief that thousands of PR freelancers need and I would plead with any employer sitting on a freelancer’s invoice to pay it tomorrow. The gaps in this plan around Ltd companies, the income limit and the exclusion of freelancers who are just starting out will mean thousands of freelancers get nothing.
“Freelancers are the oil in the PR industry machine and will be in high demand when business picks up. Employers who protect that goodwill will benefit enormously.
‘How can we survive until June?’
Gavin Harris, an independent PR practitioner and copywriter, warned that although the financial support will be backdated to March, it will arrive too late for many.
He said the delay, which is much greater than the “few weeks” businesses must wait for wages support, “simply isn't good enough”.
"I'd respectfully like to ask the Chancellor, what does he say to those self-employed workers who are in financial dire straits now – how are they supposed to survive until late June, at the earliest?
"Also, what happens to new self-employed workers who don't qualify? It's devastating news for them. And how exactly will self-employed contractors operating through a limited company be able to access adequate support when they pay themselves a small, nominal 'salary', but take the majority of their salary as dividends, when dividends won't be taken into account as part of 'normal earnings'?”
Harris said the Government needs to find a way to support self-employed workers more rapidly or many could face ruin.
"I know the Government has, rightly, said it can't save every business and individual from financial ruin and bankruptcy,” he said.
"But this snail-pace scatter graph support will only maximise the number of self-employed workers who go to the wall, not reduce it."