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Journeys to Formalisation

Journeys to Formalisation . Welfare to Work Convention 2011 . Community Links & the informal economy. East London charity – 35 years Supporting 30,000 local people every year 10 years + focus on informal work and poverty Evidence base: 25 reports +

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Journeys to Formalisation

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  1. Journeys to Formalisation Welfare to Work Convention 2011 www.community-links.org

  2. Community Links & the informal economy • East London charity – 35 years • Supporting 30,000 local people every year • 10 years + focus on informal work and poverty • Evidence base: 25 reports + • Policy development: HMRC Hidden Economy Group • Campaigns: ‘Need NOT Greed’ www.community-links.org

  3. About cash-in-hand work Definition • Economic activity hidden from the state for tax, benefit or employment law purposes, but legal in all other respects. Facts & Figures • 12.3% / ₤120bn of UK’s GDP • Over 2 million workers • Av. 20% in deprived borough’s www.community-links.org

  4. Who are we talking about? • Employees • Employers • Self employed • Many local organisations working to support people: Skills & expertise, experience, passion, solutions www.community-links.org

  5. What’s the problem? We are under-estimating our local economy. • Latent potential: unrecognised work • Targets are often not met • Investment may misdirected • Services are not responsive enough to actual local needs • People are moving out of absolute poverty but may be trapped in relative poverty www.community-links.org

  6. What changes have happened so far? • Complexity and restrictions in the welfare system that resulted in people working informally will be removed in Universal Credit • Employment support services have become increasingly tailored to address personal barriers to the formal labour market. • HMRC has taken a balanced approach of the carrot and the stick www.community-links.org

  7. What else needs to happen? • Universal Credit must work for people wanting to become formally self employed. • A formalised self employed person should be considered an outcome on the Work Programme. • Front line services like Jobcentre Plus should consider a ‘two ponged’ approach to customers they suspect of doing undeclared work. • Community outreach support should consider informal workers. www.community-links.org

  8. The benefits of formalising a business • For the individual • business growth • For the employment provider • Harnessing entrepreneurialism; improving lives • For Government • Cost savings, increased compliance www.community-links.org

  9. The ‘How To’ • For the individual • ready to formalise / legitimise • Support organisation • Experienced and trusted • Government • Develop a strategy to ‘formalise’ people www.community-links.org

  10. Mechanics of formalising • Professional skills • Holistic support • Trust • be implicit • Actively sell the benefits of formalising • Tailor support to a person’s own needs • Apply the “only look forward” principle www.community-links.org

  11. Contact Details Maeve McGoldrick Community Links 105 Barking Road, London E16 4HQ 020 7473 9644(direct line) maeve.mcgoldrick@community-links.org www.community-links.org www.community-links.org

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