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The government’s plans for the sharing economy

There can be no clearer sign that a trend has crossed over into the mainstream than when the government commissions a report into it.

Earlier this year in September, the Department for Business, Innovation and Skills (BIS) asked Debbie Wosskow, the CEO of property sharing website Love Home Swap, to head up an independent review of the new wave of services that help consumers rent out and borrow everything from money and pets to spare rooms and DIY skills.

What the government wanted to find out was, to what extent could the sharing economy be expected to have a social and economic impact in the UK. In other words, how would the Airbnb, Zipcar, TaskRabbit and Zopa and their rivals be likely to change the way we shop, work, travel and run our finances, for example.

What were the potential benefits of the growth of sharing and what action if any should politicians be taking to promote the sharing economy, as well as to regulate this kind of activity?

Wosskow’s review sought the views of the companies in this sector as well as those of consumers, workers’ representatives and firms who currently compete with the sharing economy – traditional hotels, high street banks or established car-hire firms, for example.

Recommendations for government

The review’s analysis of the sharing economy contained few surprises: as most people involved in the sector are aware, its potential for growth is huge in this country.

Ultimately the review found that the government should make it as straightforward as possible for individuals to take part in the sharing economy and to rent out spare goods, property and skills.

Specifically, this should involve looking at the regulations surrounding activities such as sharing accommodation and transport or offering to carry out small tasks. For example, Wosskow said, people who listed a holiday home or spare room on Airbnb or her own website should not be expected to face the same level of bureaucracy as a hotel chain.

Standard tenancy agreements should be revised to get rid of the current explicit ban on sub-letting. But people who offered accommodation should be obliged to meet specific safety criteria, such as having a smoke alarm on every floor.

The review also said the Department of Work and Pensions should promote task-sharing services through its Job Centres as a way of helping the unemployed gain experience and get back into work.

On the transport side, there should be an increase in the number of car-pool lanes where single-occupant vehicles are prohibited.

No need to wait for new rules

Ministers are due to respond to the review and its recommendations early next year: we await their proposals with interest.

In Britain, peer-to-peer finance has generally been established longer than the services Wosskow’s report focussed on. As such, there is already a reasonable – and appropriate – regulation surrounding P2P lending; next year will also see new rules on tax relief for bad debts, as well as an extension of the ISA system to accommodate services like Zopa.

In other sectors, a relaxation or clarification of legislation will no doubt be welcome.

But don’t be put off by talk of the changes that are supposedly necessary to promote the sharing economy. The fact is, at the moment there is very little to stop anyone getting involved.