Sunak told promise to protect families ‘sticks in craw’ of those missing out on Covid support

Chancellor confronted with despair of businesswoman who fears she will be made homeless

Andrew Woodcock
Political Editor
Thursday 04 March 2021 18:48
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'No workable option' to help ltd company directors, says Rishi Sunak

Money Saving Expert Martin Lewis today told Rishi Sunak that his promise to do “whatever it takes” to protect families and businesses through the pandemic “sticks in the craw” of millions of people excluded from support.

In an ITV grilling a day after his Budget, Lewis confronted Mr Sunak was today confronted with the despair of workers excluded from his coronavirus support packages, including one self-employed woman who said feared being made homeless and a company director who said she had been “thrown overboard”.

Despite financial support packages totalling £407bn announced by Mr Sunak over the past year, an estimated 3 million people are believed to have so far missed out on any financial support for a variety of reasons.

Mr Sunak used his Budget to extend help to 600,000 people who set up as self-employed just before the coronavirus crisis struck, and were unable to provide the tax returns which would allow them to claim support on the basis of previous turnover.

But others still missing out include people who were between jobs or due to start new posts after 19 March 2020, those denied furlough by employers, those earning less than 50 per cent of their income from self-employment or with more than £50,000 in annual trading profits, those on maternity, parental or adoption leave, those on PAYE freelance short-term contracts, small limited company owner-directors and businesses ineligible for grants.

Lewis - known to millions as the Money Saving Expert because of his website offering advice on personal finances - read some of the concerns submitted by email and text by excluded individuals.

And he told Mr Sunak: “You have repeatedly said you would do ‘whatever it took’ to protect, people, families and businesses through this crisis.

“I need to be honest, that particular phrase sticks in the craw of many who were excluded, especially one-person operators of limited companies.”

In an interview on Teesport dock, to be broadcast on the Martin Lewis Money Show Live on ITV at 8.30pm on Thursday, Lewis read out a tweeted message froma woman called Fi, who said delays in receiving help could leave her homeless.

A fourth round of grants under the Self-Employment Income Support Scheme (SEISS), announced in the Budget, will not be open for applications until late April - a far slower schedule than previous rounds.

Fi asked:“Why, why, why isn’t the fourth grant for SEISS available now? late April will leave me homeless.” 

Mr Sunak replied:“Well the simple reason is the grant covers the period for February to April so people will need to have a sense of their circumstances over that period...  “

But Mr Lewis responded: “Hold on. In past grants you’ve done three-month periods and you’ve done it at the beginning, so that logic doesn’t follow.”  

Mr Sunak replied:“The difference this time is we’re making an improvement in access to the grant and we want to bring in all of those people who have filed tax returns for 2019/20 and that means we need to have those come in.”

Adding more flexibility to the deadline also meant that ”we need a little bit of extra time to process all of that, to do the grants, and I think that’s a reasonable approach to take,” said the chancellor.

Consumer champion Lewis read out a message from viewer Gemma who asked:“Why on earth have you excluded limited company directors yet again? We were teetering on the edge and you just threw us overboard.”

And he challenged the chancellor: “What is it you’ve got against the limited company directors that they are completely without support? They haven’t had the support that other businesses and self employed have had”.

Mr Sunak denied they had been left completely without support, reeling off programmes from which they might benefit, including furlough, bounce back loans and mortgage holidays.

But he admitted that he had been unable to find a “workable option” to help this group, because the Treasury had no definition of who limited company directors are.

“My ministerial colleagues have met with groups and looked at options and there just isn’t a workable option,” said Mr Sunak. 

“We think there’s maybe around 600,000 of those people, but we don’t actually know because there’s no official way that we know.

“We get 3.3m dividend tax returns and we have no way of differentiating between the 3.3m and the 600,000 - if that is indeed the right number.

“So if we did provide support it would mean that three out of every four pounds from the taxpayer going out would not be going to the right people.

“And that is the challenge that we’ve been grappling with and we just haven’t, there is no way to square those two things.”

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