At the Conservative Party Conference on 6 October 2025, Shadow Minister for Business Secretary Andrew Griffith called for reform to IR35, reigniting debate over the controversial legislation. But contractors shouldn't be fooled: this isn't reform, it's déjà vu.
The Conservatives can't decide what they believe about IR35 — and that confusion has cost contractors dearly. They introduced the reforms in 2017 and extended them to the private sector in 2021, despite calls from their backbenchers for a delay. However, they then announced a repeal in 2022 by their own Chancellor, Kwasi Kwarteng, which was swiftly reversed by his replacement, Jeremy Hunt. Thankfully, they finally fixed a flaw they’d ignored for years in April 2024, but that wasn't enough; now they're calling for changes to the very legislation they created, repealed, and subsequently reformed.
Embarrassingly, the MP who is now promising they will 'look at it again' voted No to the delay vote (Amended 20) on 1 July 2020, along with the Shadow Chancellor, Mel Stride, who was responsible for introducing it in the first place.
A failure of scrutiny, not of principle
What we are examining here is an admission of their failure to govern, resulting in regulations that lack efficacy. Yet, they are using their own failures to try to win back power. It's a brave tactical move.
The only saving grace for the Conservatives is that they did introduce further changes to IR35 in April 2024 (offset legislation), which dramatically reduced the tax risk for firms by 75%. However, the main issue I see right now is that most firms have not received the offsets memo and still have blanket banning-type IR35 policies based on an outdated analysis of the legislation.
Is this Regulatory incompetence and failure?
The making of UK legislation follows the Hague and Harrop 5-step framework (see page 309), which is incorporated into the Cabinet Office Guide to Making legislation.
Key components of the process are referred to as pre- and post-legislative scrutiny. However, where executive dominance occurs, these are often overlooked, being viewed more as hurdles than as a vital part of democracy – a point argued as recently as February 2025 by Professor Meg Russell, Director of the Constitution Unit, in her paper Should we be worried about the decline of parliamentary scrutiny?
Russell's concerns were aptly demonstrated during the process of the off-payroll rules becoming legislation: "By the time of the third reading in Parliament, it was apparent that the bill was not ready in it's current form, and backbenchers of the Conservative Party expressed concerns, as did the entire Labour opposition – yet, the then Prime Minister exercised his dominance, and 3-line whipped the backbenchers who were calling for a delay. Post-legislative scrutiny failed.
At the post-legislative scrutiny stage, changes were made in April 2024 as a result of reviews by the National Audit Office and scrutiny by the Public Accounts Committee; however, these changes did not go far enough. Once again, we saw fiscal imperatives of the Treasury override the democratic process.
The Conservatives are effectively admitting that their own legislation, which has already undergone the entire parliamentary process, has failed to achieve its policy objectives. But, they are snookered, because to admit wrongdoing means they will be throwing their own Shadow Chancellor, Mel Stride, under the bus. Stride was also responsible for the disastrous Loan Charge.
What can be done?
Based on my campaigning experience, one key lesson is to only campaign for something you think you can achieve. Whilst Reform is the only party promising to repeal IR35, they don't have a chance of being in power and laying a Finance Bill before Parliament until 2030. Any "repeal" drum banging until then will be pointless.
The Conservatives have essentially signalled more post-legislative review and potential change, to which I agree, and this is where the door could open.
Firstly, I do not see any opportunity for the Labour Party's proposed consultation on Single Worker Status to have any impact on IR35 at all. That is a rights issue (which I agree with), not a tax issue. Also, bear in mind that the last four consultations on status went nowhere other than being put back into the "too hard" drawer. Betting on snail races does not bring fast victories.
Despite the excellent post-legislative scrutiny by the Public Accounts Committee, resulting in the April 2024 changes, many firms are still taking an overly cautious approach, which distorts the market.
The distortions are undermining the effectiveness of the legislation, resulting in many contractors being out of work and paying less tax. We have contractors who were compliant but are now unable to find work and are therefore paying no tax.
From my perspective, the overreach of the legislation is caused by fundamental drafting errors in the legislation, which fail to be clear and precise, thereby introducing ambiguity that firms and HMRC case workers are struggling to resolve. That is solvable in the short term, either via amendment or case law.
Do Labour want Growth?
Labour are desperate for growth, and an easy way to obtain it would be to refine the legislation so it becomes more effective – thereby not unwittingly resulting in compliant contractors being sat on the bench paying no tax. That would let the self-employed thrive, helping UK Plc grow.
Until politicians treat the self-employed as the backbone of the economy rather than a tax risk to be managed, IR35 will remain broken. Don’t wait for the Conservatives to fix it — hold them to account for it.