Cameron pledges to cut red tape for small business

 

Prime Minister David Cameron gave examples of the "pointless" regulations that are being scrapped

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Thousands of rules affecting business are to be scrapped or amended, David Cameron has told a Federation of Small Businesses (FSB) conference.

More than 3,000 rules will be dropped or changed, saving more than £850m a year, he told the FSB.

They include 640 pages of cattle movement guidance, 286 pages of hedgerow regulations and 380 pages of waste management rules.

Mr Cameron said he wanted to "get out of the way of small business success."

His government would be the first in history to end a term in office with less regulation on the statute books than when it came into power, he said.

Cutting the country's deficit, reducing taxes and freezing fuel duty was part of the government's "clear long-term economic plan", he added.

Start Quote

The UK's large businesses need to play their part too in supporting ambitious small businesses, for example through paying their smaller suppliers promptly”

End Quote Mike Cherry FSB policy chairman

Reducing red tape, cutting business rates, and scrapping the jobs tax from April 2015 were ways the government was supporting small businesses, said Mr Cameron.

"We need to be a country that celebrates enterprise and backs risk takers," he said.

'Red Tape Challenge'

Citing some regulations he thought should go, Mr Cameron said: "If you want to sell oven cleaner in this country you need to have a poison licence."

Other reforms that have been or will be implemented under the government's Red Tape Challenge include:

  • Environment: new guidance on contaminated land and hazardous waste
  • Food labelling: regulations to be reduced from 30 to 17
  • Road transport: 142 regulations "scrapped or improved" - 36 million vehicles will no longer need a paper tax disc
  • Aviation: 48 out of 83 regulations "scrapped or improved"
  • Health and safety: "at least one million self-employed" removed from health and safety regulation, and more than 100,000 "low-risk businesses" exempt from inspections
  • Housebuilding: 100 "overlapping and confusing standards" applied to new homes reduced "to less than 10" - estimated saving £64m.

The Department for Environment, Food, and Rural Affairs (Defra) will have slashed 80,000 pages of environmental guidance by March 2015, saving businesses around £100m per year, the government said.

While business organisations broadly welcomed the government's initiative, environmental groups were more sceptical.

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"The Government must stop making the environment a scapegoat for the economic challenges we face," said Craig Bennett, policy and campaigns director for Friends of the Earth.

"Important rules that safeguard our health and environment are being lost in this ideologically-driven war on red-tape."

Engine for growth

Other proposed measures for small businesses include a £1.1bn package of business rates relief, £100m of broadband vouchers to help businesses get online, and up to £2,000 each in growth funding for 20,000 small businesses.

The FSB said that big business could help more by paying suppliers on time.

Mike Cherry, the FSB's policy chairman, said he wanted the conference to help set the agenda for a sector that is frequently portrayed as an engine for growth, skills, and economic recovery.

"The government must focus on how they can support these businesses in job creation and growth while the UK's large businesses need to play their part, too, in supporting ambitious small businesses, for example, through paying their smaller suppliers promptly," he said.

Despite multiple support schemes for small firms, research suggested only limited take-up or support. The FSB has called the current system "congested and confusing", pointing to the US as a better model.

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The US Small Business Administration (SBA), part of government, has a large budget, long-term strategy, and influence at the centre of power, Mr Cherry said.

"The UK government should look at whether an institution built along the principles of the US SBA is needed - bringing together business support, export guidance, public procurement, and other small business functions into one place, providing a powerful small business voice within government."

'Seat at the table'

Shadow business secretary Chuka Umunna said that Labour would create an SBA to support small firms in their dealings with government departments.

Karen Mills, former head of the SBA and a former member of President Barack Obama's cabinet, will address the conference.

She said: "As governments look to the future, their plans have to be centred on growth, and the primary currency should be well-paying jobs.

"With that, any conversation focused on jobs must include small business and entrepreneurship."

She added: "When small business has a seat at the table, we can more effectively focus on entrepreneurship and innovation, which are critical components to a strong economic game plan in today's world."

 

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