Self-employed switch sides to back Lib Dems at small business election debate

Sir Ed Davey was a convincing winner at a hustings in the City (From The Times, 27 November2019)

The Liberal Democrats are more famous for socks, sandals and vegetarian cuisine than for being the party of small business and enterprise. However, if an entrepreneurs’ election hustings held this week was anything to go by, some of Britain’s five million self-employed may be ready for a rethink.

Sir Ed Davey, the party’s deputy leader, was the big winner of the event held in the City, with 54 per cent of the audience of more than 100 small business owners, investors and freelancers backing him at the end of a Question Time-style debate with political rivals.

His closest competition came from a beleaguered Liz Truss, the Conservative trade secretary, who was supported by only 24 per cent in the “exit poll”, down 12 points on the proportion who said they would back her party in the election before the debate began. In contrast, Sir Ed gained 15 points in the “before and after” polls.

“We are now the party of business. They have given up the mantle,” Sir Ed claimed, pointing at Ms Truss.

Rather than any great enthusiasm for their stance on self-employment, the Lib Dem victory may be down in part to frustration over Brexit among a Remain-leaning audience, as well as anxiety over Labour’s plans to increase business taxes and frustration over government policy towards those who work for themselves.

According to the Association of Independent Professionals and the Self-Employed, which organised the hustings with Enterprise Nation, a small-business network, confidence among freelancers is at a five-year low because of concerns about the economy and anxiety about new rules that mean many of them will face a higher tax bill from next year.

It was against this backdrop that Ms Truss’s praise for entrepreneurs as “heroes” fell on stony ground. She was asked about Boris Johnson’s “f*** business” remark as she insisted that entrepreneurs should welcome Tory plans, such as yet another review of business rates, affordable loans for start-ups and more support for exporters. There were also vague promises to cut “red tape” as well as to improve broadband.

Ms Truss, 44, provoked laughter from some when she said that Mr Johnson’s revised deal with the European Union was “very good”.

Sir Ed, 53, sensed his moment, claiming that leaving the European Union would “tie people in red tape” and that “bare-faced lies” were being told about getting Brexit “done” since it was likely that uncertainty over the issue would continue long after the election.

He won support for his attack on the “quite shocking” loan charge scandal, in which freelancers have received unexpected tax bills running into tens of thousands of pounds, and said that IR35, a law imposing additional taxes on the use of contractors, would hurt the self-employed.

Michael Hilton puts a question to the panel representing all the main parties standing in England

His call to replace business rates with a levy on land value was echoed by Labour’s Bill Esterson, the Green Party’s Amelia Womack and Hector Birchwood of the Brexit Party.

Ms Womack, 34, deputy leader of the Green Party, claimed that former Tory supporters were “joining the Greens because of our policies on small businesses”, including scrapping business rates and reducing VAT for hospitality businesses.

Mr Esterson, 53, had been delayed by Virgin Trains. He said that this was an example of “the market failure of having a privatised railway”. He won plaudits for saying that Labour would scrap the extension of IR35 and would tackle perennial small business issues, such as late payment and access to finance. He managed to dodge questions on Labour’s plans to increase corporation tax, bring dividend taxation in line with income tax and scrap a relief from capital gains tax for those selling their businesses.

Emma Jones, founder of Enterprise Nation, said that the swing to the Lib Dems demonstrated “that the small business community is looking for a party that has done some convincing thinking about the issues that matters to them”.

Carl Reader, 38, a self-employed adviser to small companies, said he was dismayed at the focus on Brexit. “It was as if other policies affecting businesses didn’t matter. I was disappointed with all of them. This has made me less likely to vote.”

Leave a Reply