Could the Saudi situation threaten your financial health?

As the political crisis in the Kingdom of Saudi Arabia continues to deepen, with the future of thousands of freelance professionals in the country’s oil industry is coming under the spotlight.

For the 30,000 UK workers in the Kingdom, the majority being self-employed contractors in the oil and gas industry, there are clear implications from any political upheaval, not only in the potential loss of employment and personal security, but also from increased insurance costs. For employers, there is also the risk that wage bills will rise as workers demand ’danger money’ for continuing to stay in the region.

Sandy Robertson, Managing Director of Freelance Euro, a leading specialist accountancy services provider for freelance and contracting professionals, explains that, although personal safety is always the paramount concern, the financial problems faced by Saudi-based workers caught up in the crisis could continue long after they return to the UK.

Most Britains employed in Saudi Arabia are contract workers, fulfilling highly specialised technical roles. If political unrest forces oil producers to scale down their activities in Saudi Arabia, or even withdraw completely, there may be no immediate alternative places to find work, although it is likely that other countries would create some employment by increasing production to address the shortfall.

For those who remain, it is likely that existing policies for insurance against injury or death will no longer be adequate and that additional cover or a separate policy will be required. If the risk of attack or personal injury is perceived to be high, then the increased premiums may be prohibitive. If contractors’ costs are increased, they will have to charge more to employers, who will address the rising costs by scaling down operations and laying off staff - So the cycle continues.

The situation in Saudi Arabia brings home the fact that freelance professionals in traditionally variable industries, such as oil and gas, need to maintain their personal and financial affairs in good order, particularly if the potential exists that they may face a period of unemployment. It is vital that insurance is in place, all tax liabilities are met and a pool of savings is maintained where possible.

At the moment, it seems that the situation in Saudi could go either way, adds Celine. The Government is trying to crack down on extremist elements, but we have no way of knowing how successful this will be and, in the meantime, western workers will continue to be targeted. The immediate reaction of many workers is to send home family members, but it is also vital to plan ahead in case they have to leave themselves.

Many freelance professionals working abroad have not even paid the requisite national insurance contributions to qualify for benefits in the UK, but continue to have financial commitments here. The answer is simple, whether you intend to return or stay on, plan for the worst and make sure your financial affairs are in order.


Issued by Beattie Communications on behalf of Freelance Euro For further information please contact Rob Lawson on 0113 213 0300
Email: rob.lawson@beattie-leeds.co.uk