Red tape moratorium not enough

The Federation of Small Businesses has warned that, despite the three-year moratorium on new regulations for micro firms in the UK, these businesses will still be hit by the large number of regulations coming out of Europe.

The overall cost of red tape to businesses in the EU is €124bn a year and 72% of the total cost of UK regulation now originates from Brussels. There have been more than 100,000 pages of new EU regulations since 1997.

The FSB is calling on government to push for stronger changes in the EU to ensure that this constant flow of extra regulatory burdens comes to an end. The organisation is urging MEPs and Commission Officials to “think small first” and introduce a one-in-one-out rule for all Commission proposals.

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In addition, the FSB has said it is disappointed that the Government appears to have decided to remove some large regulatory changes from the moratorium, including the extension to paternal leave and pay and the removal of the default retirement age – both of which impose a big burden on small businesses.

John Walker, FSB national chairman, said: “The FSB has welcomed the government’s commitment to help ease the burden of regulation on these [small] businesses, but we are concerned that regulations coming in from Europe will hit small firms harder and as a result they will feel the impact of these on their firm much more. If the burden of unnecessary regulation is lifted from small businesses, they would be free to get on with creating wealth, jobs and growth. It is worth remembering that if only 50% of the EU’s small businesses employed just one extra person there would be an additional 10 million jobs.”

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