Government plans could cut red tape

By John Harrington

- Last updated on GMT

Related tags: Red tape, Regulation, Small business

A trade group says new Government plans to monitor regulatory bodies could mean less red tape for small businesses. The proposals are included in two...

A trade group says new Government plans to monitor regulatory bodies could mean less red tape for small businesses.

The proposals are included in two consultations that ended this week. The first, for the Draft Regulatory & Sanctions Bill, proposes setting up the Local Better Regulation Office to encourage "less burdensome approaches" to regulation from groups such as trading standards and licensing departments.

The Bill also proposes a "sanctions tool kit" to allow authorities to "deal with non-compliance in a proportionate way", including helping businesses obey laws.

Another consultation on the Draft Regulators' Compliance Code says any regulations "should entail the minimum burden compatible with achieving desired regulatory outcomes". It also recommends more transparency for regulators.

The Federation of Small Businesses (FSB) welcomed the aim of the proposals "as a step in the right direction to reduce the red tape burden on small firms".

However, the group said "there are still improvements to be made" and has submitted ideas to the consultation.

Research from the FSB has found the average small business spends 28 hours per month filling in forms for the Government.

FSB policy chairman John Walker said: "We welcome the Government signalling its intention to reduce the administrative burden on small businesses, but we have heard similar noises in the past. It is time for action so that small firms can spend less time filling in forms and more time creating jobs.

"Following John Redwood's proposals to reduce red tape for the Conservatives, the challenge for all parties now is to ensure adequate, but proportionate, legal protection for workers and the public."

Some of the FSB's proposals

l If regulators from more than one agency aim to inspect the same business then these inspections should take place at the same time to avoid disruption.

l Regulators should provide free advice, with no threat of punishment. This will assist small firms in complying with legislation much more effectively than through prosecutions. Currently many small firms avoid seeking advice from regulators because they could leave themselves open to prosecution.

l Regulators should produce annual reports on their performance against targets set for them.

l Regulators should base their priorities for inspection on risk assessments. Accreditation systems can be over-burdensome and should not be used.

l Penalties should be proportionate; for example, a supermarket should be fined on a different scale to a corner shop.

l Regulators should publish penalty guidance and enforcement policies.

Related topics: Legislation

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