Brexit: The government needs to start facing reality

Brexit: The government needs to start facing reality

New report highlights what the UK’s self-employed are concerned about

We need to talk about Brexit. They may be the words you were dreading to read, but fear not – this is not an account of the latest in the endless series of Brussels negotiations or parliamentary bickering. Rather it’s time we had a proper think about what the self-employed want and need out of Brexit.

For too long, the discussion around our exit from the EU has revolved around arid statistics and political in-fighting. But in this time of uncertainty, protecting the flexibility and dynamism of the UK economy is imperative.

As freelance marketing consultant, Laura Chamberlain, 39, puts it in IPSE’s new report, A Brexit Deal for the Self-Employed: “It feels like the voice of the self-employed has been lost in the Brexit discussion. What really matters to me is whether industries stay in the UK and freelancing opportunities still exist.”

I couldn’t agree more. It is time we heard the voice of the UK’s 4.8 million self-employed loud and clear.

Brexit is weighing on the minds of the self-employed

One thing IPSE’s report highlighted is how Brexit is undoubtedly an increasing worry for the self-employed. In the Freelancer Confidence Index survey, conducted by the association at the end of 2017, 61 per cent of people said the result of the referendum was the main factor that was negatively influencing their business performance – overtaking government policy for the first time.

Given the ongoing disaster that is IR35, this is a significant and concerning finding. Gary Sharp, an IPSE director and financial services programme manager from Glasgow, summed up the uneasy mood. He said: “Brexit has created a lot of uncertainty in the banking sector. It’s not clear whether projects will be based in the UK in the coming years.”

But as we all know, the self-employed are a diverse bunch. Simon Nicholson, an aerospace consultant from Bristol, gives a far more upbeat assessment. He told me: “Brexit seems to have created more interest in my availability for overseas contracts.”

Balancing migration concerns post-Brexit

One thing we can say with some confidence is that the self-employed want to be able to move and work freely in the EU and further afield. Given the unique expertise they are able to offer, it should be no surprise that their skills are in great demand across the world. This was another key topic addressed in IPSE’s report: how can the post-Brexit migration system support Britain’s flexible labour market?

Given the public clamour for a more restrictive approach towards immigration, this is a difficult circle to square. If Theresa May is hell-bent on appearing to curb immigration, creating a system that allows independent professionals to move around as and when they are needed, is going to be a challenge.

According to the report, much public hostility towards high levels of immigration revolves around relatively unskilled immigration and the impact this is perceived to have on wages, housing and public services.

There is therefore a strong case to be made for the government to prioritise the free movement of skilled professionals, while still addressing concerns around immigration levels. This will of course have to be a reciprocal arrangement in which independent professionals from the UK can travel and work relatively freely in the EU and vice versa.

A reciprocal model like this should help UK-based freelancers too. This is because many industries in which freelancers work (such as the creative sectors and IT) are bolstered by large numbers of talented Europeans coming to the UK to ply their trade. If a more restrictive immigration system was implemented post- Brexit, there are valid concerns that many businesses in these sectors would choose to relocate to the EU in order to maintain access to the right talent.

The Freelancers Confidence Index survey revealed that the majority (69%) of the selfemployed also want to see access to the single market prioritised in Brexit negotiations. Taken together with the need to work freely overseas, it is fair to say they want to see a Brexit that causes minimal disruption – what some would term a ‘soft Brexit’.

Building a fair and flexible immigration system

There is a plethora of options for how the UK could deliver such a freelancer-friendly system post-Brexit; and some make more sense than others.

Models of employer sponsorship won’t work, because much selfemployment is short-term in nature, and points-based systems are heavily bureaucratic. Businesses choose to engage freelancers because of their agility and flexibility.

By increasing the cost, time and administrative burden of hiring independent professionals, employer sponsorship would erode these benefits. Entrepreneurship visas are also not a good option – they typically have very high investment thresholds and aren’t a realistic option for most freelancers.

Ironically enough, it is probably towards our European neighbours that we could look for inspiration. For example, the Self-Employment Visa system in the Netherlands offers permits for freelance work when it is deemed beneficial to the Netherlands (e.g. applicants must have at least one commission and demonstrable experience in their field).

Where there are clear skills shortages, we should explore the viability of occupational or sector-specific visas. The UK also needs to consider whether short-term visas to fill seasonal shortages such as agriculture and construction should be brought in.

What we really need though is to have a serious discussion about what reciprocal migration model would best support flexible working post-Brexit. We shouldn’t limit our horizons to the EU; trade deals with farflung nations could also open up plenty of opportunities for UK-based freelancers.

Making Britain a country that works for freelancers

The UK government must also think more strategically about what it does in its own stomping ground. The fact is that the self-employed will play a central role in taking us through this turbulent period and the government must recognise this. As Kelly Gilmour-Grassam, a 25-year-old copywriter from Manchester, said: “Rather than spending all its energy on Brexit, the government should focus on how to help businesses start and flourish at home.”

Kelly has hit the nail on the head there. If we want the UK to continue to punch its weight as a leading economic power, we need to rethink how it treats the self-employed. We need a fair, modern tax system, not a punitive one, as well as better ways to help the self-employed upskill and save for later life.

The government’s Brexit strategy needs to start facing reality. Above all, it needs a way to maintain and protect the UK’s key competitive advantage, it’s flexible labour market. That means not only getting a Brexit deal that works for the self-employed, but also adopting policies at home that boost rather than bash our enterprising class.

By Jordan Marshall