The Recruitment and Employment Confederation (REC) appears to have had a productive meeting with Treasury minister David Gauke and senior HMRC officials this week, in which the vexed issue of the misuse of subsistence and travel schemes was discussed.

While the vast majority of recruiters and legitimate Umbrella Companies play by the rules and do not abuse these schemes, they are being disadvantaged by unscrupulous rivals who had few qualms about misusing them and distorting the market in the process, said REC head of policy Tom Hadley.

Announcing that the Treasury is now contemplating a series of practical solutions to solve the misuse of these schemes, Mr Hadley continued: “More robust government action to ensure a level playing field is not just an issue for recruiters but also for legitimate Umbrella Organisations.”

He added: “Bad practice by some tarnishes the reputation of our whole industry. That’s why we are committed to working with the government to provide real clarity to recruiters and shine a light on dubious models.”

The REC, Mr Hadley continued, will work with Revenue officials closely to make sure that real progress is delivered, focussing especially on a new public drive to enforce minimum wage regulations.

The meeting was in response to an earlier call from the REC and some of its individual members for the government to tackle the increasing market distortion resulting from the misapplication of these schemes, a number of which directly contravene national minimum wage regulations.

The meeting was also attended by Umbrella Company representatives such as Professional Passport, the Freelancer and Contractor Association and Saffery Champness, along with external tax advisers and MP Lorely Burt.

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