In today's budget Chancellor George Osborne
revealed a mixture of financial measures, changes to
regulation and new initiatives that he says will
both cut the deficit and boost business growth.
In this article we take a look at the measures that
will have an impact on the growth of flexible
working practices. And it's true to say that
flexibility was not at the heart of the budget,
though some of the measures will have an impact.
If anything, the language around flexibility was
more in the traditional rather than innovative
sense, about the advantages of having a 'flexible
labour market'. But here are the key measures that
make an impact. Ditching planned extension to
flexible working legislation
Already announced a few days earlier, the
scrapping of an extension to the number of parents
eligible to have the 'right to request' flexible
working was confirmed as part of a wave of measures
to reduce the regulatory burden on business. This
was seized upon by Ed Miliband, the opposition
leader who said:
'But I have to say, his decision to cancel
flexible working for families with children
between 16 and 18 is extraordinary. Only this
Prime Minister could take the credit for
championing a policy with
Mumsnet, and then a few months later take
the credit with small business for dumping it.
You’ve got to ask, Mr Deputy Speaker – has he
no shame? The idea that families needing
flexibility imperil our economic future is
frankly absurd. And tells you all you need to
know about this Government’s values and how they
think our economy succeeds. Greater insecurity
as the route to greater prosperity. Well we take
a different view. Flexible working is yet
another broken promise from the broken promise
Prime Minister'.
The axed plans in question were to extend the
right to request flexible working to parents of 17
year olds for all businesses, which was due to start
on 6 April 2011. However, this was a measure that
the Department calculated would cost £0.5 million,
and seems perhaps unnecessary in view of the
government's restated commitment to extend the right
to request to all workers (not only parents).
So, despite the opportunity for rhetoric, it's in
practice a only the delay of a very minor change.
See our
flexworld blog for further comment. Support
for start-ups and small business - but where's the
home business?
There are a range of measures announced to
support business development, though at this stage
lacking in detail. Support for innovation,
cutting back red tape, small business mentoring,
proposed enterprise zones, support for exports, high
technology centres .... But though it may be
different in practice, the approach does have an air
of 'back to the future' about it, and little
apparent recognition of how the world of work has
changed. In particular, there is no recognition
that the majority of business start-ups take place
from home, which operates in a regulatory grey area.
And not a single mention of self-employment. I
fear the reality will be building more 'high tech'
business parks - i.e. offices in unsustainable green
field locations - and competitive funds for mid-size
businesses that generate more bureaucracy than
private sector jobs. High speed broadband
Support for high speed broadband including into
rural areas is announced (again!). When it comes it
will be a boost for home-based and local businesses,
and will fuel demand as it increases capacity for
remote working, videoconferencing, virtual meetings,
etc. Unintended fiscal boost for part-time
working
The progressive raising of tax thresholds towards
£10k, along with the raising of thresholds at which
employers pay Employers' National Insurance
contributions, will bring about a boost to part-time
working. Increasingly it makes sense to come off
benefits and go into work, and it is increasingly
practical for parents of young children to take
part-time work. And it becomes even more
advantageous for families with a single breadwinner
to try to become a family with two part-time
breadwinners. In 2011-12 a household income of
(say) £30k will go much further if both partners
earn £15k rather than one partner be the sole
earner. They will take home more than £2k
extra, and this will rise further in 2012 as the
basic tax threshold is raised to over £8k.
Changing from a £50k sole earner to two £25k earners
will bring home an extra £3k saved from the taxman.
Save that up for a couple of decades and there'll be
enough to pay off those tuition fees for the kids
...
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