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Press Release

FSB support Bill designed to cut red tape

8 February 2006

The Federation of Small Businesses today expressed its support for the Legislative & Regulatory Reform Bill as it reaches its second reading in the House of Commons.

The Bill proposes to give power to the Government to deliver reform of outdated or over-complicated legislation more quickly and make EU legislation easier for UK organisations to deal with.

The FSB surveyed its members and identified that:

  • Small businesses spend an average of 28 hours per month filling in forms.
  • Administrative burdens for small businesses are 5 times more costly and 5 times more time-consuming than for large firms.
  • Small firms spend almost 5% of their annual turnover on compliance.
  • The annual cost of payroll administration is £288 per employee in a 1-4 employee firm but only £5 in a business with over 5,000 employees.

John Walker, FSB National Policy Chairman, commented:

“Regulation is a large burden on small businesses. Our members tell us that remedying this situation must be a priority for Government and we support this Bill as part of the solution to achieve that.

“Some have expressed concern over the Bill, fearing that some necessary protections will be removed. We are not advocating irresponsible erosion of safeguards but merely asking that excessive, over the top, unnecessary measures are removed.

“Previous attempts to address the cumulative burden of red tape have not delivered on their promises. Between 1999 and 2005 there has been, on average, one new statute per month that affects business.

“Although instant results can be achieved by clarifying guidance to businesses, reducing the amount of time a small firm has to spend working out how to comply with legislation, we need to deliver more than this to match the achievements of some other EU nations. They are achieving reductions of 25% in regulation.”



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Federation of Small Businesses

Federation of Small Businesses

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