Economic Progress

Coronavirus: UK offers financial support to the self-employed

This article was published in collaboration with Reuters.
Britain's Chancellor of the Exchequer Rishi Sunak attends a news conference on the ongoing situation with the coronavirus disease (COVID-19) in London, Britain March 17, 2020. Matt Dunham/Pool via REUTERS - RC2ULF9BPA0M

Britain's Chancellor of the Exchequer (Finance Minister) Rishi Sunak, announced measures to support the self-employed throughout the crisis. Image: REUTERS

Estelle Shirbon
Reporter, Reuters
Andy Bruce
Reporter , Reuters
Share:
Our Impact
What's the World Economic Forum doing to accelerate action on Economic Progress?
The Big Picture
Explore and monitor how Economic Progress is affecting economies, industries and global issues
A hand holding a looking glass by a lake
Crowdsource Innovation
Get involved with our crowdsourced digital platform to deliver impact at scale
Stay up to date:

Economic Progress

  • The UK government has announced measures to support Britain's 5 million self-employed workers unable to work due to the coronavirus lockdown.
  • The grants will cover 80% of their average monthly profits from the past 3 months, up to a value of £2,500.
  • 15% of Britain's workforce are self-employed and the scheme is estimated to cost £10 billion.
  • The financial support will not be available until mid-June.

The British government will pay grants to self-employed people who have lost their livelihoods because of the coronavirus lockdown, further extending an unprecedented package of measures to prevent the economy from collapsing.

Finance minister Rishi Sunak, who had previously announced the state would pay part of the wages of employees to dissuade their firms from laying them off, had come under pressure to offer a similar lifeline to Britain’s 5 million self-employed workers.

Have you read?

Governments around the world are scrambling to avert economic catastrophe, underlined by shock figures from the United States showing that more than 3 million Americans applied for unemployment benefits last week.

Sunak said Britain’s government would pay those self-employed people who have been adversely affected by the coronavirus a taxable grant worth 80% of their average monthly profits over the last three years, up to 2,500 pounds ($3,000) a month.

Coronavirus Covid-19 virus infection China Hubei Wuhan contagion spread economics dow jones S&P 500 stock market crash 1929 depression great recession
Coronavirus case numbers in the UK. Image: Statista

“To all of those who are self employed, who are rightly anxious and worried about the next few months: you haven’t been forgotten, we will not leave you behind and we are all in this together,” Sunak said at a news conference in Downing Street.

But he added that self-employed workers will have to last out until mid-June for the scheme to kick in and they must also wait to be contacted by tax authorities.

The scheme will be open to those with trading profits of up to 50,000 pounds, for at least three months.

A Treasury official said up to 3.8 million workers will be covered and two think-tanks, the Resolution Foundation and the Institute for Fiscal Studies, estimated the measures will cost the government some 10 billion pounds.

The cap of 2,500 pounds per month is the same as that for employees in the package of measures announced previously. Together, the schemes for employees and the self-employed will protect around 80% of British workers, Sunak said.

“What we have done will, I believe, stand as one of the most significant economic interventions at any point in the history of the British state and by any government anywhere in the world,” he said.

About 15% of Britain’s workers are self-employed, a bigger share of the workforce than in any other Group of Seven rich nations apart from Italy.

Challenging times ahead

The British Chambers of Commerce (BCC) and the Association of Independent Professionals and the Self-Employed welcomed Sunak’s plans.

“It is now critical that the government delivers this practical support to people on the ground as soon as possible,” BCC director general Adam Marshall said.

Opposition Labour Party spokesman John McDonnell said he welcomed the new measures but worried that self-employed workers would need help sooner than mid-June.

Working in tandem, the government and the Bank of England have been announcing enormous packages of measures to try and cushion the impact of the epidemic - the scale of which was underlined by new figures showing the UK death toll had risen by over 100 to 578.

The central bank carried out two emergency rate cuts earlier in March and vastly expanded its bond purchase programme. It said it was ready to further ramp up its bond-buying programme if necessary.

Don't miss any update on this topic

Create a free account and access your personalized content collection with our latest publications and analyses.

Sign up for free

License and Republishing

World Economic Forum articles may be republished in accordance with the Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International Public License, and in accordance with our Terms of Use.

The views expressed in this article are those of the author alone and not the World Economic Forum.

Related topics:
Economic ProgressInequalityCircular EconomyCOVID-19
Share:
World Economic Forum logo
Global Agenda

The Agenda Weekly

A weekly update of the most important issues driving the global agenda

Subscribe today

You can unsubscribe at any time using the link in our emails. For more details, review our privacy policy.

Africa's debt crisis needs a bold new approach. Here's what countries can do

Danny Bradlow

February 28, 2024

About Us

Events

Media

Partners & Members

  • Join Us

Language Editions

Privacy Policy & Terms of Service

© 2024 World Economic Forum