The Recruitment and Employment Confederation (REC) has welcomed new Prime Minister Liz Truss, following her victory over former Chancellor Rishi Sunak in the recent Conservative Party leadership contest.
Truss’ campaign included a pledge to review the controversial IR35 legislation which came into force for the public sector last year and for private sector businesses in April 2021. The rules have been widely criticised in the contracting industry for their impact on self-employed workers and businesses that engage them.
This promise was hailed in a statement on Truss’ victory by REC CEO Neil Carberry. Carberry also welcomed the new Prime Minister’s pledge to create a low-tax economy, including through cuts to National Insurance Contributions (NICs), which increased by 1.25 per cent in April 2022.
In his statement, Carberry wrote: “Everyone at the REC would like to congratulate Liz Truss on her appointment as Prime Minister. We are keen to work with her and the new Ministerial team on strengthening the labour market and overcoming labour and skills shortages. We welcome the Prime Minister’s focus on reducing NI and on reviewing the application of IR35 as it doesn’t work and we need legislation that supports flexible working.”
“As well as reducing ambiguity over tax status for businesses we hope to work with the new government on skills and immigration policies that support economic growth and boost productivity. A quick win on both would be to reform the Apprenticeship Levy to make it accessible to many more people including temporary workers.”
Truss’ victory has, overall, been met with a mixed reception from the contracting sector, with some welcoming her promises to cut tax and review IR35, but others expressing scepticism, given the perceived failure of previous reviews on IR35 to deliver real change. A recent Qdos survey found that 94 per cent of contractors considered Truss’ pledge to review IR35 to be an “empty promise”.
The REC has also announced that it will soon share its new “Manifesto for Growth” document with the government, setting out in detail its policy ideas.
