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Industry reaction to Conservative victory

by LLB Reporter
13th Dec 19 10:28 am

Carolyn Fairbairn, CBI Director-General said, “Congratulations to Boris Johnson and the Conservative Party. After three years of gridlock, the Prime Minister has a clear mandate to govern. Businesses across the UK urge him to use it to rebuild confidence in our economy and break the cycle of uncertainty.

“Employers share the Prime Minister’s optimism for the UK and are ready to play a leading role. They can bring the innovation, investment and jobs for a new era of inclusive growth. The biggest issues of our times – from tackling climate change to reskilling the workforce for new technologies – can only be delivered through real partnership between government and business.

“The starting point must be rebuilding business confidence, and early reassurance on Brexit will be vital. Firms will continue to do all they can to prepare for Brexit, but will want to know they won’t face another no deal cliff-edge next year. Pro-enterprise policies on immigration, infrastructure, innovation and skills, will help relaunch the UK on the world stage.

“Despite recent challenges, the UK remains a great place to start and build a business. A new contract between enterprise and government can make the UK a global magnet for investment, powering higher productivity and living standards across the UK.”

Federation of Small Businesses (FSB) National Chairman Mike Cherry said:

“Small business owners will be hoping that today’s clear result helps to bring stability back to the economy.

“After more than three years of Brexit absorbing government bandwidth, the Conservative Party has pledged to tackle the many domestic challenges that have been neglected during that time.

“In the coming days we will see a Queen’s Speech and steps towards leaving the EU next month. Amid this, small businesses the length and breadth of the UK will be looking to the new Government to achieve positive change for small firms in its first 100 days, not least with publication of a pro-business Budget in early February.

“The restoration of small business confidence and trust in politics rests on seeing the Conservatives’ pledges to us swiftly enshrined in a programme for government. It’s now time to turn kind words on bread and butter issues facing the small business community into tangible action.

“This government needs to deliver a business-friendly Brexit. That means one that protects the three t’s: trade, talent and a proper transition. The third of those is absolutely critical. We have to avoid a scenario where we suddenly crash out of the EU with no time for small firms to prepare for what’s coming next.”

Peter Bishop, Chief Executive of London Chamber of Commerce and Industry, said:
“Individual political viewpoints aside, businesses will be grateful that the election has delivered a clear result.
The uncertainty caused by previous parliamentary deadlock had significant economic and business confidence impacts.

The majority of London businesses now want the avoidance of a no-deal Brexit. And they want the government to agree a realistic transition period in order to negotiate a future trading arrangement with Europe that is as straightforward as possible, and provides access to balanced immigration of all skill levels.”

What the Conservative win means for employers? Kate Palmer, Associate Director of Advisory at Peninsula said, “Employers can expect to see substantial changes to employment law under the continued Conservative Government, who this morning maintained power of the nation after nine years at No. 10.

“While not as weighty as the Labour Manifesto on making changes to employment law, the Conservative manifesto promised a wide variety of developments in areas including employee pay and family-friendly rights.

“Although not an immediate change, employers are waking up to confirmation that the National Living Wage will increase to £10.50 per hour by 2024, with the age threshold incrementally lowered to 23+ in 2021 and finally 21+ by 2024. The lead in time to this change will enable employers to factor increase wage bills into their future budgets.

“Employers will also have to review their leave policies, as more time off will be given to new parents of a sick baby. A keen eye should be kept on any changes to paternity leave as the party will look at ways to increase take up. With flexible working to become the ‘default’ arrangement, employers may be forced to be more creative with working hours to ensure operational demand is still met. Working arrangements will also be impacted by a right for those with caring responsibilities to take time off.

“With a promise to continue with the Good Work Plan which includes more rights for those in unpredictable work and to keep to the January 2020 Brexit deadline, it’s safe to say that employers will be kept busy over coming months and years.”

Dave Chaplin is CEO and founder of contracting authority ContractorCalculator and director of StopThe Off-Payroll Tax campaign.  Commenting on the election result said, “In the run up to this election we heard a number of political parties pledge to review IR35 and as Boris Johnson re-enters No. 10, I would like to remind him of that promise.  Having a complex employment status test at the heart of the tax system hasn’t worked for 20-years under the intermediaries legislation and hasn’t worked under the new rules in the public sector either.

“The Off-Payroll rules in their current proposed format create an unfairly burdensome scenario which has the potential to poison the entire engagement process between contractor, client and agency.  It will force thousands of contractors into false employment, expose self-employed contractors to excessive taxation as well as depriving UK plc. of essential access to talent and key skills and drive up project costs.  Combined, this will work to further incite tax non-compliance and tax evasion.  I would urge the Prime Minister to now confirm that he will conduct a proper review, put the Off-Payroll roll-out on hold and work with the contracting community and stakeholders on devising how best to recognise contracting and freelancing in the tax system.  An Off-Payroll review should be put right at the top of his agenda as he takes up office again.”

Julia Kermode is chief executive of The Freelancer & Contractor Services Association (FCSA), the UK’s leading professional membership body for umbrella employers and accountancy service providers supporting the financial affairs of professional contractors.

On the Election result she said, “With Boris Johnson returning to Number 10 this morning I would like to remind him and his Government that they have promised to review the planned off-payroll reforms.  We must now hold him to account and press him to conduct that review and with only just over three months to go before the legislation is due to be rolled-out in the private sector, surely that must mean a postponement?

“We are already seeing the very real impact of this damaging legislation on businesses and thousands of professionals.  If they don’t delay then the promise was nothing short of an arrogant and disingenuous move to secure votes.  We have also learned today that the budget is now being planned for February/March which is simply too late for the off-payroll legislation to be properly implemented.  Many businesses have already invested heavily in preparing for the changes, and given the legal requirement for reasonable care it is unrealistic to press pause for a potentially meaningless review to take place.  If the Government wants to avoid utter chaos and shambles, businesses need clarity NOW.

“I would also hope that the Government uses its mandate to deliver on the Good Work Plan.  One of the commitments was to regulate umbrella firms from April 2020 and we are yet to see any draft legislation and time is running out.  And, with many sham ‘umbrella’ firms opening up in business with the specific aim of cashing in on the off-payroll reforms it should be a priority for Mr Johnson, lest we will see a slew of tax avoidance schemes wreaking havoc once again on the lives of innocent people along the lines of what we have seen with the loan charge.”

John Bell is founder and senior partner at licensed insolvency practitioners Clarke Bell.  On the election result he said, “The Conservative party pledged to review IR35 in the run up to the election and now we need to hold them to account that the promise of a review was not simply an empty promise made in order to secure the contractor vote but a genuine intention.

“If the reforms are rolled out into the private sector it will have a huge impact on businesses and contractors. We need a review into IR35 as a matter of urgency as the uncertainty is having a crippling effect on the livelihoods of many contractors as well as impeding hiring decisions by firms. We are already seeing an increase in the number of contractors turning to us for advice on closing down their limited companies faced with the concerns that the legislation will have on their work and careers.  Decisive action not platitudes is what is needed now.”

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