Small businesses railing at regulations

Oct 19 2009 by Karen Dent, The Journal

THE Federation of Small Business (FSB) is calling for an overhaul of business regulations to stimulate the economy and create jobs.

The organisation says stopping new business-related legislation and reducing red tape could open up and save more than 300,000 jobs nationally.

More than a quarter of members that wanted to expand told the FSB they were afraid to do so because of the complexity of current legislation.

Half of those looking to close or downsize said that regulatory burdens had played an important part in their decision.

Figures produced by the Government suggest that 60% of enterprises consider regulation to be an obstacle to success. Using those statistics, the FSB calculated that removing some regulations could create more than 258,000 jobs and save more than 55,500.

Its Regulatory Reform – a Route to Economic Recovery policy paper is calling for a halt to new business legislation during the recession and for the first 18 months of the recovery.

It also wants current regulations covering maternity and paternity laws, discrimination and health and safety to be simplified immediately.

North East businessman and national FSB chairman, John Wright, said: “We cannot and must not underestimate the burden that unnecessary regulation puts on small businesses.

“Around half of all firms planning to close or downsize were influenced in that decision by the heavy impact of regulation.

“However, we know that small firms want to employ more staff and the Government should be making it easier for them to do so, especially as we pull ourselves out of recession and into recovery.

“The FSB is urging the Government to give the UK’s regulatory environment a strategic overhaul, to provide it with what will amount to a second economic stimulus to boost growth and employment.”