Issue 39; 20 February 2000

PCG Strategy | Agents | Clients | Contractors | Conclusion | New Constitution

PCG Strategy
It might be a useful time to point out PCG's strategy to date and our future plans regarding IR35.

From the outset, PCG never considered this to be a issue which had one line of attack. There have been many groups we needed to influence and options open to us to pursue. Since day one (May 1999) these have all continued with greater or lesser emphasis depending on the moment. It would be naive to assume that we would lobby each group in isolation and then only move on to the next when each one has been exhausted. For months now these have been running many threads in tandem with each other. Although the obvious focus to date has been on the political dimension, the other aspects and groups have been bubbling away on the back burner for some time until we needed to turn up the heat.

The issues and groups we have been simultaneously addressing are:
-Revenue
-Treasury
-MPs
-Legal
-Client
-Agencies
-Unions
-Other Representative groups.

To date, the main 'battlefield' has been the Revenue, Treasury and MPs. I will not rehearse what our members and we have achieved with the politicians - it is well documented on our web site. Those achievements should not be underestimated and they will continue throughout the Finance Bill. However, the writing is clearly on the wall and the time is right to focus more of our activities on the areas we have been researching for some time.

LEGAL
When PCG was formed in May 1999, it was clear that, while our initial push had to be political, we should have contingency plans for a legal challenge. Bond Pearce, a legal firm with considerable experience of the European Court, was engaged - and has been on a continuous basis - from day one to explore all routes open for challenge in the courts. As it became clear that the legal side was likely to become important, we increased our legal team by retaining the services of a second top firm, Bevan Ashford. Both firms are analysing all options open to us - and have been for some time.

At the end of January, we met leading QC, Gerald Barling, who has had considerable experience of taking cases to the European Court, including cases involving the Government. At this point, it is worth repeating for some people, that this case would involve taking on HMG, and to try to proceed without having done these months of research would be foolish in the extreme and doomed to failure.

This necessary preparation has been funded to date from existing PCG resources as it has always been our intention to explore the legal avenues to the full. This has been carried on without detracting from the main activity in Westminster and Whitehall. We knew we could go this far within existing resources - and thereafter should a legal challenge be necessary and a real possibility - we would establish a separate fund. We are now in the process of doing that.

When we had prepared the groundwork, it is our intention is share our knowledge with other groups and call on them to join us in the main legal push. We had started this building of alliances, believing that a concerted effort through one channel was the best way forward - That offer is still on the table for groups who want to pool resources on this issue.

PCG's campaign director, David Ramsden, is identifying a top figure with legal and political experience to oversee this area of the campaign. As soon as the regulations are published, we will be in a position to go forward. This decision will be taken in light of all political and commercial factors at the time and with the best interests of members to the fore.

AGENTS
In conjunction with the political and legal work, for month's discussions have been taking place with agents and their representatives - both with the PCG executive and on an individual level with members. Now the guidelines are out, the time is right to increase the activity. For some months we have been developing a contract with our legal team - this is in second draft and is out for consultation.

The reaction among agents has been mixed. Some are still playing at being ostriches and refuse to change - but other more enlightened groups are seeing the advantages of adapting to suit the changing times. Mark Roderick is acting as co-ordinator with the agencies, and our associate membership is rising steadily. The associate forum is starting to work and one forward thinking Agent, who has engaged members in discussion, has had to request that members stop sending her copies of their brochure as she cannot cope with the load.

The current round of seminars in 10 locations around the country include afternoon sessions for agents and clients which, to date, have been well attended. Some space is still available.

CLIENTS
Increasingly, clients are recognising the benefits they can achieve by amending the relationship they presently have and driving costs out of the business. Following one of our seminars, the largest client in the area, requested direct negotiations with PCG. Within 24 hours this had happened and a constructive dialogue is now underway between the client and our local PCG representative to consider how to reflect a genuine self employed relationship. We believe we will see more of this. We would request Contractors make sure they alert their Client to the afternoon seminars and ask them to attend.

CONTRACTORS
For some time, we have believed that if the Government insisted on pushing through this measure it would lead to the creation of two types of contractors - the independent consultant, who could clearly jump the barrier and the "permatemp", who would fail IR35. PCG has members who fall into both categories, though it is our intention to help as many of them as possible over the barrier.

The independent consultant will have skills in high demand and will, in many cases, be able to contract directly with a client. If the 'permatemp' has to pay tax and NI as an employee, it is only reasonable to expect that he or she receive some of the benefits associated with employment. To this end, we have already had meeting with the Unions and will continue that dialogue.

Work on PCG's portal site is well advanced and should go 'live' in March. This will give contractors and users an opportunity to tender directly with each other as well as demonstrate the ability to locate a suitable "Substitute".

CONCLUSION
This has been a somewhat lengthy situation report, which I feel was necessary to illustrate that while some might think we have been focussing on one area at a time, we have, in fact, been working behind the scenes to cover many possibilities.

We will continue to fight this ill-conceived measure in Parliament, but we have already seen that this Government is prepared to use its sizeable majority to drive through any measure it chooses regardless of the strength of argument to the contrary. The ground work we have done with legal challenges, agents and clients in the past few months will now reap rewards as we will increase our activity in these areas in the coming months.

New Constitution
Members, please ensure you have voted on this proposal by close of business Monday 21st February - Vote on New Constitution - vote closed.

Kind Regards
Andy White
Chairman PCG