PCG welcomes news FI Group has withdrawn 'reward'

The Professional Contractors Group (PCG) welcomed the news that computer company, FI Group, has caved in to pressure and withdrawn its offer of £1,000 'reward' to employees to 'shop-a-contractor' who could be replaced by cheaper workers from the Indian sub-continent.

The scheme was revealed in a feature in the Mail on Sunday (December 24) and roundly condemned by the contractors' representative body, the PCG, as 'corporate blood money' (see Press Release 16/00).

The Professional Contractors Group accused the Government of helping large companies introduce a 'corporate blood money scheme' which aims at replacing UK highly qualified contractors with cheaper imported labour.

The accusation follows an investigation by the Mail on Sunday (December 23)which revealed that computer-services company, FI Group, is offering its employees a £1,000 bounty to nominate UK contractors with the company who could be replaced by cheaper workers from the Indian sub-continent.

Business guru Sir John Harvey-Jones has agreed to become patron of the Professional Contractors Group, the representative body for independent contractors.

Sir John was the keynote speaker recently at the PCG’s first annual conference and annual general meeting. Speaking at the event, he told PCG members: "I’m a very strong admirer of what you have done and I am very keen to see you do even more in the immediate future."

The Professional Contractors Group called on the Prime Minister to scrap the so-called stealth tax IR35 which is putting tens of thousands of small entrepreneurial companies out of businesses.

Gareth Williams, Chairman of the PCG, said: "The Prime Minister has announced that he wants to make the UK the best place to start up businesses. However, next door in the Treasury, his Paymaster General (Dawn Primarolo) is the architect of legislation which is destroying tens of thousands of small businesses.

The Professional Contractors Group has launched its first personal affinity discount deal for its 11,000 members. The PCG, the representative body of independent contractors, has teamed up with Medibroker Online, a UK based specialist independent medical insurance broker, to offer members discounted Private Medical Insurance.

Pamela Edwards, PCG's Membership Services Director, said: "PCG is now entering the next stage of its Membership Services strategy by delivering premium business services exclusively for its members. As independent contractors who originally came together to lobby against IR35, an unfair Government measure, we found that our combined strength gave us a political voice which we did not previously have. Now we recognise that it also gives our members a significant presence in the market-place and the ability to negotiate favourable affinity deals.

In an open letter to the Prime Minister, the Professional Contractors Group has called on the Prime Minister to intervene and repeal IR35, the stealth tax which is damaging small businesses in the knowledge-based sector.

In a first public marketing exercise, the UK's fastest growing professional body has taken a stand at the British Business 2000 exhibition. The Professional Contractors Group (PCG) is promoting the skills of its members at the Olympia exhibition centre, London on 19th -21st October. PCG members are independent consultants providing expert knowledge and experience to engineering and IT projects. At the exhibition, PCG will highlight the advantages to large and small companies of using professional, flexible workers for key short and long-term projects.

The Professional Contractors Group today (October 10) won the first victory on the legal road to having IR35 - the so-called 'stealth tax' - struck down as illegal.

The High Court gave the PCG permission to have the measure judicially reviewed - despite legal arguments from the Government.

The Professional Contractors Group called for 'joined-up Government in practice' when Home Office Minister Barbara Roche recognised there was an 'international scramble to attract IT experts' in a speech on immigration policy on the same day (September 11) that the Prime Minister published the e-envoy's report with a commitment to monitor the effects of IR35 - the Treasury's tax measure which is driving the UK's IT small businesses overseas due to unfair treatment compared to their larger competitors.

The PCG, which represents the interests of 10,000 independent consultants, has been warning the Government for 18 months that the Treasury's measure to treat small businesses, mainly IT contractors, as if they were employees for tax and NI purposes would result in a brain-drain as these people took their cutting-edge skills overseas.

The Professional Contractors Group and its founder, Andy White, were nominated for four national awards in the New Statesman's New Media awards for innovative communication using new technology.

PCG and Andy received a 'special mention' in the Elected Representative Section and were nominated in Advocacy, On-line Communities and Overall Merit.

In a joint letter, industry leaders called on the Government to think again about IR35 before it's too late.

In an open letter in the Financial Times today (July 7), the Director General of the CBI, Digby Jones; the National Chairman of the Federation of Small Businesses, Ian L. Handford and the Chairman of the Professional Contractors Group, Gareth Williams, called on the Government to 'draw a halt and consider a better way forward'.

The Professional Contractors Group called on the Government to abandon its controversial IR35 proposal as it emerged that large foreign-owned companies could use a loophole in the proposal to gain a tax advantage over their smaller UK competitors by employing cheap, foreign labour.

The UK Government is introducing 'fast track visas' for Indian, East European and other overseas IT specialists to meet the skills shortage in this country. However, some large foreign owned companies are employing these workers on low salaries then 'renting' them to clients for highly inflated fees.

The Professional Contractors Group (PCG) called for the controversial IR35 legislation to be suspended after the country's leading tax accountants sent the Government a clear measure that 'it could do better'.

The respected Tax Faculty of the Institute of Chartered Accountants measured the Government's IR35 proposals against 10 tenets of best practice and found that it scored only 30 out of a possible 100.

On the day that the controversial IR35 legislation came into force (April 6), the Professional Contractors Group (PCG) announced it was challenging the Government in the courts to have the legislation struck down as unlawful under European law.

The PCG, which represents independent contractors has retained the services of Gerald Barling QC and will be filing a challenge in the courts against the Government early next month.

The Inland Revenue has approved the first non-IR35 contract submitted to them based on the Professional Contractors Group contract.

The contract, drafted by PCG solicitors Bevan Ashford is available - free of charge to members - from the PCG web site. A number of contracts to suit different circumstances are provided, and the range is being extended.

This version - contractor to agent contract - was submitted to the Revenue after being personalised by a PCG member. The Revenue reviewed the contract and concluded that, if the written terms accurately reflected the practical nature of the arrangement, then the contract 'would not be subject' to the proposed IR35 legislation.

Chairman of the Professional Contractors Group, Gareth Williams said: "The Chancellor had an opportunity to right the IR35 wrong of twelve months ago."

"Far from his stated intention to 'remove the old barriers to investment and enterprise', the Chancellor is erecting new and higher barriers. Small software start-ups will risk being treated as employees of their first client and taxed on 95% of turnover. This is a catch 22 situation. How will they ever get to the point of having multiple clients to escape this legislation?

IR35 INFORMATION SEMINARS

The Professional Contractors Group is holding a series of IR35 information seminars around the country for contractors, agents, clients and other interested groups.

IR35 is a controversial proposal by the Government which would force independent contractors - mainly from IT and engineering - into an 'employee status for tax and NI purposes. The result will be that tens of thousands of small businesses are forced to close down, while many highly-skilled people take their expertise overseas.