Federation of Small Businesses calls move real victory.
The FSB has warmly welcomed the government’s proposals to slash red tape, saying it is good news for the UK’s 4.8 million small firms.
Research by the FSB shows almost a third (27 percent) of small firms that wanted to expand claimed increased regulation posed a difficulty to them doing so. Of businesses planning to downsize or close, half said that regulatory burdens were a critical factor in that decision. It was the second most important factor behind the retirement of the business owner for firms closing.
The proposals by business secretary Vince Cable include a one-in, one out approach to regulation to keep it under control and the creation of a new Cabinet Star Chamber that will lead the government’s drive to reduce regulation. An immediate review of all regulations in the pipeline inherited from the previous government has also been suggested.
The FSB said that it was keen for Mr Cable to send a strong message to his colleagues in other government departments, urging them to explore alternatives to regulation before legislating.
FSB policy chairman Mike Cherry said: “Regulation has long been stifling business growth, so these plans to put an end to the excessive legislation that choke small businesses is welcome news. It is a real victory that our calls to simplify the regulation system have finally been heard."
He added: “Small firms have repeatedly said that the burden of regulation and the time it takes to comply with is just too much and could prevent them from taking on staff – and stunts economic growth. We now need to see the government give detailed plans as to how these will take affect so that small firms can get on with growing their business, rather than spending precious time filling in.”