Next steps on IR35 moot - it's a PSC ban that's the problem

[WavyDavy]

Every few hours there's now a story about HMRC and The Treasury being pressured to delay or re-think IR35.

Give many large client organisations (mine included - RBS) are side-stepping the IR35 debate by forcing a ban on PSCs, does anyone here thing that the edge-case likelihood of a delay/repeal of IR35 will make any difference at all?

Isn't the damage done? Does anyone see companies rethinking their PSC bans in the event of a IR35 miracle?

[min]

Every few hours there's now a story about HMRC and The Treasury being pressured to delay or re-think IR35.

Give many large client organisations (mine included - RBS) are side-stepping the IR35 debate by forcing a ban on PSCs, does anyone here thing that the edge-case likelihood of a delay/repeal of IR35 will make any difference at all?

Isn't the damage done? Does anyone see companies rethinking their PSC bans in the event of a IR35 miracle?

No, damage is done.

[ladymuck]

There's a chance it's a knee jerk reaction while they determine the fall out and put in place proper processes for determining what resource they need, and on what terms. That said, nothing will change for a good year I reckon. That's just a hunch rather than hard fact.

[Manic]

Agreed, certainly in the short term PSC bans are here to stay. Everything is now in place and all the winners here (brollies and agents come pseudo consultancies) will want to maintain that.

If and a big IF the govt changed it's stance, then I would imagine within 2-3 years there will be a gradual but slow shift back. This depends on the clarity and the trust that whatever solution is put in place would not be changed again. This may mean rowing back the changes in the public sector too.

[northernladuk]

With 6 weeks to go? Not a chance.

[wattaj]

Agreed, certainly in the short term PSC bans are here to stay. Everything is now in place and all the winners here (brollies and agents come pseudo consultancies) will want to maintain that.

If and a big IF the govt changed it's stance, then I would imagine within 2-3 years there will be a gradual but slow shift back. This depends on the clarity and the trust that whatever solution is put in place would not be changed again. This may mean rowing back the changes in the public sector too.

^^ This. Strap in for the long-haul folks.

[oliverson]

The only reason they aren't engaging PSC's is because of IR35. If it gets canned completely I think the market will return 'very' quickly. There's no reason for it not to. It would have the least friction going forward.

[WavyDavy]

The only reason they aren't engaging PSC's is because of IR35. If it gets canned completely I think the market will return 'very' quickly. There's no reason for it not to. It would have the least friction going forward.

I hope you are right!

[thesquaremile]

The only reason they aren't engaging PSC's is because of IR35. If it gets canned completely I think the market will return 'very' quickly. There's no reason for it not to. It would have the least friction going forward.

+1. PSC blanket bans are nothing but last-minute knee jerk reactions from BigCorp who a) didn't bother about IR35 until the deadline and b) underestimated it's relevance. Speak to any clueless manager or HR and you would know how important a priority this was. With IR35 enforcement out of the picture they would revert back to previous model, which is well established and yielding results for them (in form of skill-set fulfillment) since years.

[PTP]

Agree the damage is done because of the shortcut that clients have taken (i.e. banning PSCs) and I can't see them undoing that.

Plus, the musical chairs it causes can't be stopped.

But making contracting unfeasible or unattractive and leading people to retire, go abroad or go permie......can easily (me thinks) be undone by GOV/HMRC making travel & subsistence be tax deductible again like it used to be for inside/umbrella contractors (subject to 2yr rule or other limit). Take home pay still won't quite be as much as outside IR35 but it would be more than enough for contracting to stay feasible and attractive.