A recent priority for our campaigning work was highlighting to policymakers how the Minimum Income Floor (MIF) is preventing some of our members from accessing the recently announced Cost of Living payments. Another focus was calling on the Department of Work and Pensions to monitor the impact of the MIF on those working in the performing arts and entertainment sector.
What is the Minimum Income Floor (MIF)?
The MIF is an assumed amount of income (usually the national minimum wage x 35 hours per week) applied to UC claims where the claimant is Gainfully Self-Employed (meaning broadly that self-employment is your main work and it is organised, developed, and regular and carried on in expectation of profit). The MIF is applied every month regardless of how much you earn and if you earn more than it, your higher earnings amount applies.
How is the MIF impacting members’ access to Cost of Living Payments?
In May this year, the Chancellor announced that one off Cost of Living payments would be available in the summer and autumn to help certain groups with the rising cost of living. Those eligible are:
- Those in receipt of means tested social security such as UC (to receive the Cost of Living payment you must have been in receipt of certain social security payments as of 25 May 2022 or have begun a claim which is later successful).
- Those in receipt of disability related social security.
- Pensioner households who receive the winter fuel payment.
The government also requires UC claimants (those in group 1 above) to have a UC award of at least a 1p during the qualifying month covering 25/05/22. In practise this would mean that claimants who are subject to the MIF, and have their UC payments reduced to zero because of it, would not be eligible for Cost of Living payments. As our members will know, whether a claimant gets a UC payment during an assessment period in which the MIF applies depends on their financial and personal circumstances that month. The one-size-fits-all nature of the MIF means that some creative freelancers may miss out on these crucial payments.
Lobbying for change to legislation and policy
When Parliament debated the relevant legislation, Equity lobbied for a change to the rules so that all UC claimants subject to the MIF could receive a Cost of Living payment, including those with a zero UC payment. We briefed MPs in the House of Commons and those in the House of Lords. As a result, questions were raised by Labour’s frontbench Jonathan Ashworth MP and Karen Buck MP (you can read the debate on Hansard). Our parliamentary engagement work also led to detailed interventions in the Lords by both Baroness Lister of Burtersett and the Earl of Clancarty (see Hansard). Unfortunately our efforts did not result in a change in legislation but served to remind government that Equity is not giving up the fight against the MIF and the unfairness it creates for self-employed members.
To keep up the pressure, we worked with Conservative MP Sir Bob Neil who raised the issue of the MIF in the House of Commons during DWP Oral Questions on 11 July. Following another briefing from Equity, Sir Bob Neil highlighted its adverse impact on performers and creative workers with fluctuating earnings and the importance of collecting data on the impact of the MIF for those working in the entertainment sector. His intervention is below, you can read the full debate on Hansard or watch the video on Twitter:
The effects of UC minimum income floor are particularly felt by creative professionals with unpredictable/fluctuating incomes, something v common in the entertainment industry. We should collect sectoral data from self-employed claimants. I'm not sure the Minister was listening! pic.twitter.com/5CbUXQkZHO
— Sir Bob Neill MP (@neill_bob) July 11, 2022
I understand the objective of the Minimum Income Floor, to get into sustainable employment, but perhaps the Minister does not appreciate that for people in the performing arts and creative sectors it is not just a short-term period for which they have unpredictable and fluctuating incomes. By the nature of theatre, music, performance and so on, shows are cancelled at short notice. In fact, established performers with viable careers still get hit disproportionately by the Minimum Income Floor.
Would it not be sensible to collect the data on a sector-by-sector basis, so that we do not have a one-size-fits-all approach but can tailor it to achieve the objective he wants, which is to reach the need of each specific sector?
We will continue to lobby for improvements to our social security system so that Equity members, particularly those from low-income backgrounds, have an adequate safety net in order to stay working in the industry. If you are need any advice about the Cost of Living payments or your UC claim, please contact our inhouse Social Security and Tax Advice team via email (helpline@equity.org.uk) or telephone (020 7670 0223 – Mondays and Thursdays, 10am-1pm and 2-5pm).
