A new report from the think-tank Demos has called for the self-employed to be given more freedom and flexibility.
Entitled, “Going it Alone”, the report comes as the country’s number of self-employed workers has risen sharply. This has brought attention to the disparity in support given to regular employees.
Demos want new measures brought in to support the self-employed, including the ability to access pension contributions to encourage more people ot save.
The number of self-employed in the UK currently stands at just under 4.6m. This means they now outnumber public sector workers and account for one in seven of those employed.
While new pensions rules have been brought in for regular workers, only 30% of the self employed actually pay into any kind of pension. In comparison, half of employed staff contribute. This is why Demos says the self-employed should have more flexibility when it comes to pensions.
This would include the ability to withdraw portions of their pensions contributed within the last two years. Demos argue this would combat fears of debilitating cashflow as the wages of the self-employed can fluctuate radically over time.
Duncan O’Leary, who authored the report, said: “Saving rates for the self-employed are low and the gap is only likely to grow in the coming years. Employees already benefit from employer contributions and the ‘nudge’ of auto-enrollment into company pensions.
“The self-employed have neither of these advantages. In addition, income can be unpredictable for the self-employed, leaving many worried about ‘locking away’ money in pension schemes.”