THE Treasury and No10 are said to be divided over whether to extend state aid for the self-employed.
Their disagreements have been blamed for the delay in announcing whether the Self-Employed Income Support Scheme (SEISS) will be continued in line with the five-month extension for furloughed workers.
Chancellor Rishi Sunak has so far refused mounting calls to extend the scheme, which currently offers grants to self-employed workers of up to £7,500 to cover three months of lost income – covering March, April and May.
In contrast, the furlough scheme for employees has already been extended and covers eight months – ending in October.
This is despite Boris Johnson hailing the SEISS as giving “parity of support” to the self-employed compared with employees.
Self-employed workers have warned Mr Sunak they need a decision within days because they face a “cliff-edge” on June 1 when the money dries up.
‘A GLARING INJUSTICE’
They say not knowing whether they will continue to receive income support beyond this month will have a big impact on their ability to bounce back from the crisis.
Self-employed body IPSE warned that the Government would be committing “a glaring injustice” if it failed to extend.
Meanwhile a petition set up yesterday calling for an extension attracted more than 40,000 signatures within the first 24 hours.
And consumer expert Martin Lewis warned that hundreds of thousands of businesses will fail unless they are given parity of support.
The Treasury insists the two schemes cannot be compared because they tackle “different problems” and are different in substance too.
Officials point out that the self-employed can still work while claiming grants under the scheme, whereas furloughed workers cannot.
But that is at odds with the Prime Minister’s pledge at the start of lockdown that the Government would provide “parity of support” between the self-employed and employees.
And last month the Employment Minister Mims Davies also directly compared the two schemes.
She said in Parliament: “The scheme brings parity with the Coronavirus Job Retention Scheme, whereby the Government committed to pay up to £2,500 each month in wages of employed workers who are furloughed during the outbreak.”
A source involved in setting up the SEISS scheme in March said No10 was the driving force behind it in the first place, whereas the Treasury was initially “very against” it.
A Treasury source said last night: “These two schemes – some of the most generous in the world – were set up to tackle different problems created by Covid. We keep everything under review and have already proven we will act where necessary.”
Mr Sunak faced mounting external pressure too yesterday as self-employed bodies warned that failure to extend the scheme in line with the timetable for the furlough scheme would be “a glaring injustice”.
Andy Chamberlain from the Association of Independent Professionals said: “The self-employed aren’t just a vital and major part of the workforce: they are also the hard-working entrepreneurs we will need to kickstart the economy after Coronavirus.
‘AWFUL CHOICE’
“However, most of them cannot continue their work in the midst of this deadly pandemic and they are relying on government support to keep their businesses afloat.
“We were delighted when the government heeded our calls and set up the Self-Employment Income Support Scheme, but now it must keep it open as long as the self-employed need it.
“It must not commit a glaring injustice by extending the employee Job Retention Scheme but pulling the rug from under the self-employed.
“Maintaining employee support while scrapping self-employed support also risks forcing freelancers back to work in unsafe conditions. It risks forcing them to make an awful choice between their health and their income.”
One Tory said Mr Sunak wants to extend the scheme until the end of July but limit access to the grants to self-employed people who can prove they have no other income during that period.
He is said to be surprised at how many self-employed people have carried on working while claiming the government grants.
The Tory said: “No10 think the figures are so small, so just do it and give the economy a chance to get going again.
“The compromise will be to extend it to the end of July like the furlough scheme, but the Treasury want conditions – ie no other income during that period.”
