Businesses have warned the government about growing problems caused by red tape.

The British Chambers of Commerce (BCC) said companies were "fed up with the spiralling costs of regulation".

And the Federation of Small Businesses (FSB) said firms were becoming "cynical about promises from politicians to tackle red tape".

Publishing its "Burdens barometer", the BCC said that 46 major regulations introduced since 1998 were costing business over £15 million per year.

Director general David Frost said: "Businesses must be free to compete in the global economy.

"They simply cannot afford to be held back by the mounting costs of complying with regulation."

Lost hours

Frost added that firms are spending too long dealing with paperwork and "trying to get their heads around each and every regulation".

"Small firms say it takes large chunks out of their day, when they should be concentrating on running their businesses," he said.

"While we recognize the need for proportionate regulation, the government must ensure that new regulations are well targeted and business friendly.

"Unnecessary burdens are not a sustainable option for our firms."

Meanwhile, the FSB said politicians should recognise the need to tackle red tape as one of their six key principles for the general election.

It noted that more than ten years after businesses were promised a "bonfire of red tape", administrative burdens are still five times more costly and five times more time consuming for small businesses than for large firms.

Election strategy

"It is not surprising that small business owners are cynical about promises from politicians to tackle red tape," said John Walker, FSB policy chairman.

"Despite hundreds of government initiatives they still spend five times as much time as large companies dealing with regulations."

And highlighting the electoral impact of small firms, Walker said that 6,000 voters in each constituency could be won over by the party that "commits to radical action to tackle the cumulative impact of red tape".