So, the Chancellor speaks again – and many contractors working through umbrella companies have one overriding question: despite the rhetoric about sticking to ’Plan A’ (which the Chancellor was obliged to repeat in his Autumn Statement), are there any signs that the Government is adapting to grim new economic developments with bold new strategies?
Interestingly, the language of austerity seemed to rub shoulders with the language of growth in Mr Osborne’s latest statement. Whereas the Chancellor had previously insisted that the former would automatically lead to the latter, the latest statement suggests that a few more stops are being pulled toward growth, while ongoing lip service is being paid to austerity.
To be fair, most pundits are agreed that there is limited room for manoeuvre. A reversal of policy would, as Mr Osborne explained, likely “spook” the markets and generate excruciating interest rate rises. As REC Chairman Kevin Green put it, the Government understands that a “magic bullet” to solve the complex problems miring the economy simply doesn’t exist.
Mr Green endorsed the Chancellor’s efforts to streamline employment rules, provide clear guidance on business tax and initiate fiscal incentives for employers to hire young people. PAYE umbrella contractors and other freelancers are also likely to support the decision to green-light infrastructure projects by make it easier for companies to gain access to liquidity.
However, Mr Green believes more could have been done, suggesting that the Chancellor should have implemented a national insurance holiday for all SMEs that hire young people. The Government, he added, “… must continue to respond quickly and positively to proposals from the UK recruitment industry for stabilising and boosting the jobs market.”