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Social Security for the Self-employed

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 Shadow Work and Pensions Secretary plans social security for the Greater Manchester’s 27,000 self employed

In a major initiative to bring parity between employees and the self-employed Debbie Abrahams MP, Shadow Work and Pensions Secretary committed Labour to creating equality in the social security system between the self-employed and employees. 

With nearly 5 million self-employed people in the UK today, making up 15 percent of the UK workforce, Labour has identified significant gaps in the national insurance framework that creates long term issues.

For Greater Manchester this will provide a stronger social security system for the 27,000 self-employed people.

Unlike employees, the self-employed are not able to access important elements of the social security system such as sick pay, paternity pay, contributory jobseekers or support in the event of an accident at work. 

Additionally, there is mounting independent evidence of a pensions black hole and lower pension savings among the self-employed. Without action, and with the rise in self-employment, this could present a very serious challenge to the long term sustainability of our pension provision.  The average income for self-employed people in Greater Manchester is £18,200 compared with a £23,600 average income for employed people.

Debbie Abrahams set out five tests on how Labour will address these issues for the self-employed; tests of adequacy, fairness, equality, responsibility, and respect for the existing principles in our social security system.

In her speech, Shadow Work and Pensions Secretary and MP for Oldham East and Saddleworth Debbie Abrahams, said:

“In so many ways self-employment is characteristic of both the opportunities and the challenges faced by our society. It brings to the individual a combination of great freedom with great risk, an ability to build one’s own enterprise or to work flexibly around other priorities, it can offer great prosperity for some, but poverty pay for others.

“We have a huge opportunity to change the way we work, harnessing digital communication to make a living in a way that suits each of us.

"I believe that there are five tests that any policy looking to strengthen social security for the self-employed must meet.

Tests of adequacy, fairness, equality, responsibility, and respect for mutually re-enforcing principles of contribution, universalism and means-testing in our social security system.

“The Tories are looking to expand the role that private insurance plays in the social security system, and indeed in our health service too. This would create political opportunities for continued attacks on the safety net which belongs to us all.

“Labour will never let that happen. Only Labour can be trusted to transform our social security system, and ensure that, like the NHS, it remains there for us all in our time of need, including the self-employed.” 

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