As contractors await the Chancellor’s Budget today, managing director of accountantcy firm Brookson, Martin Hesketh, has stated that he believes Alistair Darling must pay particular attention the effect of his Budget on Britain’s flexible workforce.
Mr Hesketh wrote: “The chancellor Alistair Darling faces a tough day on 24th March as he delivers a budget upon which Labour will be judged in the next general election, potentially weeks away. The Pre-Budget Report in December was set against the backdrop of an extremely negative economic climate and even though consumer confidence appears to be returning, the British economy is still very fragile. There’s no dispute that more needs to be done if the Government continues to pledge it will halve the budget deficit in four years, but with a general election so close, I have my doubts as to whether Mr Darling will deliver further blows to the general public.”
He continued: ““However, I wish the same could be said for professional, skilled consultants and the flexible workforce. The Government continues to view the consultancy community as a relatively small number of people which is not the case. In December 3.25m* people in the UK were freelance professionals. The economic downturn forced companies to rely on contractors and flexible workers during the toughest periods of the recession as full-time staff were shed. So while the Government calls for skilled professionals to step forward they contradict themselves by continuing to target self employed and high earners with hefty taxes. If the Chancellor decides to further increase income tax on salary brackets under £150,000 the consequences would be highly detrimental to the economy and growth of a skilled UK workforce.”
Mr Hesketh concluded: ““The pre-budget report proved that the Chancellor falls back on the approach of taxing the wealthy, but with a general election looming, whatever decisions he makes will undoubtedly come under further scrutiny.”