The Government's Role in Encouraging People to Become Self Employed

How do we as a government create the right atmosphere for job creation, for people to become self employed and for people to start up their own SME (being self employed, with employees). Starting new businesses takes a leap of faith, a leap from the stability of employment into the unknown, and risk that comes from providing employment for yourself.

I know that the title of this debate is "The Government's Role in Encouraging People to Become Self Employed" but according to the Adam Smith Institute the opposite is true at the moment; HMRC and The Treasury are actively discouraging People to Become Self Employed, by adopting a policy that I quote, "force(s) as many people as possible out of self-employment. They have done this for convenience, finding it easier to deal with a single employer than to establish relationships with perhaps dozens of his or her employees."

Given that we need to encourage growth through entrepreneurship and job creation, we need to act to reverse this worrying trend, because this trend is doing damage to our economy. We are moving aspiration people away from entrepreneurship and self employment - through this policy we are effectively turning job creators into job seekers.

As a government we must ensure that the opposite holds true, we must encourage job seekers to become job creators, not just when they leave school and search for employment, but we must also ensure that we inspire employees to become employers.

The journey to the boardroom starts in the classroom; if we are to expand the number of SME's and self employed, we, as a government need to inspire our children to become future leaders and successes.

Businesses need to work with young people to bridge the gap between the classroom and the world of self employment. People who have made the journey through self employment, should be entering classrooms, and children should be given the chance to see for themselves the large number of success stories that self employment has created.

Let us be aware though, that there are many sacrifices that entrepreneurs and self employed people take; they work long hours, often investing their own capital as they lack that initial financial support. Government should be rewarding not penalizing these risk takers; these people are the driving force behind our economy, the small company that employs a handful of people and the sole trader that files his tax return late at night after a long days work.

Given the economic climate and the need to rebalance our economy, we need growth in entrepreneurship and self employment. Government should take a lead and offer specific areas where the self employed and start-ups may be able to gain exemptions

The Institute of Economic Affairs in 'Self-employment, Small Firms and Enterprise' state "There is a case for the government levelling the playing field between the support it gives to entrepreneurs and the support it gives to formal qualifications." Now the Secretary of State for Work and Pensions announced that the Government will give extra help to unemployed people who want to start their own business, through the New Enterprise Allowance (NEA) to people who have been claiming for 26-weeks or more.

I ask the question, why Isn't there support available to school leavers, why isn't this support available to people the first day they are unemployed and why isn't this support available to people who are in employment but wish to start out on their own.

By removing barriers and creating real incentives, we, as a government can show that we take self employment and entrepreneurship seriously. To borrow a phrase from Reagan in the end it is free enterprise, not government regulation, not high taxes nor big government spending, but free enterprise, which will lead to the creation of a better Britain.

Back to all posts