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Go, Go, Gordon

What then will Prime Minister Gordon Brown do for the IT industry?

I may be jumping the gun by a few months but the media are already working hard on Mr Blair’s political obituary and in Whitehall I hear that Michael Foot’s famous cloth cap is already waiting to take the collection.

In fact, I should really be asking what Alistair Darling, tipped for Chancellor, will do for IT as Gordon will have other problems to deal with once he moves into No10. If, like me you’ve been running a business in IT for twenty years or so, then you’ll know that if you’re not very big and from ‘Over there’, your chances of building an agile, competitive business have diminished quite dramatically since the last election, whether this is measured in terms of taxation, employment legislation, reversal of dividend relief for small companies or creative interpretation on the part of the Inland Revenue, in the shape of IR35 or Section 660, so-called husband and wife tax..

In a month, I turn forty-eight and I find that my peers and contemporaries are split three ways. There are those that are still working in senior roles in large IT companies, the minority. Those who are ‘self employed’ or have started smaller businesses because they have been sacked by large IT companies, the majority and finally those that are quite unable to find work, even with a successful career history behind them, because they are too old or have been out of the industry for more than twelve months.

From my own perspective, this year has been an interesting one, as the Revenue appear to suspect that I’m a programmer / contractor and have expended some energy on an IR35 enquiry. “Please look at my company website and my client list”, I pleaded. “How can you confuse Zentelligence‘s consultancy work with that of a programmer contractor”? After all, I continued, “When I was acting as an ‘Advisor’ to the Cabinet Office, did that fall within the IR35 legislation? Best ask Gordon what he thinks”.

More serious, was the discovery, during a more recent PAYE compliance visit that I had failed to properly declare the benefit of a Topic bar on a petrol receipt. This does of course constitute a grave offence for which I am very sorry but as my accountant pointed out to a very pleasant but diligent inspector of taxes, “Sometimes Mr Moores is too busy to eat lunch” and the thirty-six pence bar of chocolate should be considered as subsistence and not a benefit”. However, a bright future in Ford open prison awaits and I wonder, if like Jeffrey Archer, I’ll be allowed to continue writing my ‘Thought for the Day’ while my shameless character is being reformed at Her Majesty’s Pleasure.

To be honest though, on advice from my accountant, I’m planning a visit to Spain next month to explore the option of moving the business abroad. I wouldn’t be the first and it’s cheaper and frequently quicker to fly to London from Malaga or Nice than take the train from the Kent coast to Victoria. In his book, ‘The New Barbarian Manifesto’, London School of Economic Professor, Ian Angell, warns that government has to make an effort to understand the wider spectrum of the IT industry or risk, like outsourcing seeing the skills it needs for tomorrow’s information economy relocate to the end of another broadband pipe offering less red-tape and perhaps, a more favourable tax environment.

So, Darling, what will you do for IT, assuming Gordon moves next door and gives you the job of Chancellor? I have one suggestion and it involves a little courage on the part of the Treasury. Stop treating small businesses as an easy source of taxation and cease suffocating their growth with an endless stream of red tape. A year ago, the Chancellor incentivised small traders to become limited companies and then snatched away any of the real benefits in the last budget because too many did.

Small and dynamic IT service businesses are good for this country. They drive skills, create competition and could generate local employment if the environment was favourable. Government, instead of replacing the productive workforce with legions of diversity conscious civil servants, needs to nurture and encourage these incubator businesses rather than treat them as convenient tax targets; a short term view which does very little to grow tomorrow’s economy.

The IT industry is a dynamic part of the economy which offers great potential for the future. It doesn’t have to be ‘owned’ by a small number of large and often foreign players and any Government, today’s or tomorrows, of whatever direction or colour, needs to recognise this or be prepared, to see the nation’s talent go where it can find the best opportunity for growth without interference.


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