Three mayors of England’s biggest cities have written to Rishi Sunak calling him to help the 3m self-employed excluded from Covid business support.
London mayor Sadiq Khan, Manchester mayor Andy Burnham and Liverpool mayor Steve Rotheram have urged the chancellor to help those who have fallen through the cracks of the self-employed income support scheme (SEISS).
Otherwise, warned Mr Burnham, England faces “a mental health pandemic on top of Covid”.
>See also: 1m self-employed face having to pay tax bill larger than what they earnt
It is estimated that 10 per cent of the UK workforce have found themselves excluded from Covid-19 support, according to pressure group ExcludedUK.
Mr Burhnam said: “We’re here together to send a message to the chancellor that it’s no exaggeration to say that jobs, homes and marriages are hanging in the balance … this is so wrong on so many levels”.
The Manchester mayor said the government’s cold shoulder for those who have just taken the plunge and gone self-employed, doing just what the government wants, sends the wrong message about becoming an entrepreneur.
Mr Burnham said that there were just days left to get the message across to the chancellor before his government spending review.
The Manchester mayor said that a tax rebate from HMRC would be a simple solution to address the crisis.
Mr Khan said that it was “inexplicable” that “the wealth creators” of the UK economy have been ignored like this.
Liverpool city mayor Steve Rotheram said he would be announcing a local package of support for excluded self-employed next week.
>See also: MPs urge Government to do more to help self-employed through Covid-19
The dreadful impact on mental and physical health of those who have been excluded from government Covid-19 support is laid bare in an ExcludedUK survey.
Almost one in five of those excluded from government support are now experiencing panic attacks or phobias that they had not had before lockdown.
And 14 per cent have admitted to having suicidal thoughts or have self-harmed.
Four out of five of those excluded felt stressed or anxious, with almost half “struggling” with their mental health and 12 per cent “seriously struggling”.
Prescription drug usage has also shot up with 10 per cent of the excluded taking medication to cope with anxiety, depression and stress. A further 15 per cent said they were considering needing professional help.
Four out of five were having trouble sleeping and nearly two thirds experienced feelings of loss or failure.
Over half (51 per cent) of those excluded – which include directors of limited companies, the newly self-employed and those whose self-employed income is less than 50 per cent of earnings – have had an income less than £500 per month since the start of March.
More than three quarters of those excluded (77 per cent) have been unable to access any form of state benefit, including Universal Credit.
One third of those excluded estimate their income for 2020/21 will be anything between one quarter and nothing compared with what they earned before the pandemic.
One in five people said they are at risk of losing their home.
A quarter of those surveyed have had absolutely no work since March, and a third have had their work/trade reduced by over 80 per cent since March.
And 5 per cent have been reduced to using food banks as a result of having no income.
As a result, personal debt has spiralled with half of those surveyed forced to borrow because of Covid-19, with 25 per cent taking on personal debt of up to £10,000 and 4 per cent being strangled with over £50,000 in personal debt they didn’t have before the pandemic.
ExcludedUK surveyed over 3,000 of its members for the report.
How the 3m excluded breaks down
As for how the 3m excluded from government Covid-19 business support breaks down, the figures are as follows:
- Directors of ltd companies: 26%
- Newly self-employed: 21.3%
- 50/50 rule: 19.8%
- New starters/denied furlough: 11.9%
- Earn over £50,000: 6.3%
- Annual PAYE: 5.8%
- PAYE freelancers: 5.5%
Checklist for going self-employed – a Small Business guide