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While we await confirmation of the government’s plan to pay the self-employed whose incomes have collapsed during the virus outbreak, the Royal Society of Arts has run the numbers and thinks the Chancellor’s widely trailed strategy is not as effective as it could be.
Rishi Sunak, who has said working out a solution for the self-employed has been “’extremely complicated” is expected to offer the self-employed payments equivalent to 80% of their earnings over the last three years up to £30k. But the RSA thinks a temporary basic income of £1500 initially to help manage immediate cash-flow, followed by a weekly payment of £100 per week for three months would leave more people better off. It says:
For people earning £17,000 – the average earnings for a self-employed person, according to the ONS – they would be better off under the scheme. This would therefore cover people in vulnerable roles like Deliveroo riders and Uber drivers. For people earning more than £17,000, the benefits of this proposal compared to the government programme would taper off progressively.”
Our worry is that basing grants on 80% of average earnings over three years, or even one, will throw up too many anomalies given the changeable nature of year-to-year earnings of this segment of the workforce leaving some with very low incomes short It may also prove to be too slow and bureaucratic. It will also mean that some who are fit and healthy to work would be discouraged from doing so.”
Members of the public are being urged to take part in a national round of applause for NHS employees at 8pm this evening.
The Clap for our Carers campaign is trying to get as many people as possible to take part in the event from their gardens, front doors, balconies and windows to show their appreciation and support for health workers.