IR35 Question in Parliament by MP Jessica Morden
An IR35 question in Parliament by Jessica Morden shows that contractors’ concerns are starting to get through. A major financial catastrophe is looming with virtually all of the UK’s biggest firms announcing that they will blanket ban the use of contractors who operate via personal services companies.
However, with the implementation date for the IR35 reforms just 7 weeks away time is getting short. An even tighter deadline is the promised IR35 review the results of which are due to be announced in mid-February – which is around about now.
Contractor Question on IR35 Question in Parliament
- What question did Jessica Morden ask about IR35?
- What was the Government’s reply?
- Why was Jacob Rees Mogg’s Parliamentary answer obfuscation?
- Could the current Government IR35 review halt the changes?
- Could Contractors get the blanket banning of PSC contractors stopped?
- What problems do MPs have when asking an IR35 question in Parliament?
- What Success do Contractors have in influencing Government over IR35?
What question did Jessica Morden ask about IR35
The IR35 question in Parliament that Jessica Morden asked was as follows “On behalf of constituents who are contractors, may I ask the Leader of the House again for a debate on the IR35 change, which is fast coming upon us in April? There is much concern out there about the scope of the review. It needs to be paused and looked at again.”
What was the Government’s reply
Leader of the House Jacob Rees-Mogg responded: “I cannot really add much to what I said to the hon. Lady the last time. A review is being carried out.
“This is a matter of great concern to constituents across the country, and the hon. Lady is absolutely right that people need to know what tax they will be expected to pay before the beginning of the tax year in which they will be expected to pay it.”
Why was Jacob Rees Mogg’s Parliamentary answer obfuscation
As Jacob Rees Mogg well knows a real review of IR35, and the looming changes, is not currently being carried out. After Labour, the Lib Dems and the Scottish National Party promised IR35 reviews prior to the election, then Chancellor, Sajid Javid, promised one too.
However, after the election, the Government said that his review would not look at whether the IR35 changes would be implemented. The review would only look at how the IR35 changes could be best, and most easily, implemented.
Could the current Government IR35 review halt the changes
Contractors and their representatives are hoping against hope that this review will stop the IR35 changes, at least temporarily. However, this is simply outside of the scope of the review.
That doesn’t mean that contractors cannot still put pressure on the Government, through Parliament, to get changes to the way it is implemented or even to get it paused before a fresh review.
Could Contractors get the blanket banning of PSC contractors stopped
Stopping the blanket banning of personal services companies could potentially be inside the scope of the current IR35 review. It could be claimed that stopping the blanket banning of PSC contractors would help to get the changes implemented more easily.
So, now is he time for contractors to put the pressure on, both for this review and a potential future review.
If the mass blanket banning of contractors using PSCs by most of our major firms is not reversed, the flexible workforce will be mortally wounded. The results for UK companies and the UK economy will be massive – all in a negative way.
What problems do MPs have when asking an IR35 question in Parliament
One of the big problems for contractors is that so few, if any, MPs have a freelance or IT background. They don’t really understand the industry. They certainly don’t understand IR35 and the looming catastrophe that awaits.
Although they are able to ask questions in Parliament, none of the MPs knows enough about what is happening as regards IR35 to be able to recognize b*llshit replies from the Government and to respond to that.
A good follow up response might have been “But that review is not looking at whether the IR35 reforms should be implemented but only how they can be best, and most easily, implemented. This is not what my constituents are asking for at all.”
Contractors should try to get a further IR35 question in parliament asked. Indeed they should get as many as possible asked.
What Success do Contractors have in influencing Government over IR35
Contractor groups don’t have a great success record at influencing Government policy on IR35. However, this time many of our big companies will be massively affected too.
They are only just seeing the scale of the catastrophe that is likely to ensue after April 6th. It is just getting home to them that perhaps 40% to 50% of their freelancers will quit rather than go PAYE.
Perhaps they, combined with the best efforts of contractors, can get something done with at least the blanket banning of PSC contractors.
The pressure must be kept on MPs and the Government by contractors up and down the land. They must get a further IR35 question in Parliament asked and another and another till it starts getting through.
And they must hope that our biggest companies have a private word with Government ministers too.
Otherwise an economic catastrophe awaits – for contractors, the UK’s biggest firms and the country.