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27 January 2014

Five questions answered on David Cameron’s pledge to reduce red tape for small businesses

Which rules and regulations does Cameron intend to amend or scrap?

By Heidi Vella

At a conference in March the Prime Minister will pledge to scrap or amend thousands of rules affecting small businesses. We answer five questions on the proposed changes.

Which rules and regulations does Cameron intend to amend or scrap?

At the Federation of Small Businesses’ (FSB) annual conference in March Cameron will pledge to make changes to more the 3000 rules, according to the BBC. These include 640 pages of cattle movement guidance, 286 pages of hedgerow regulations and 380 pages of waste management rules. House builders are set to see 100 standards applied to new homes reduced to less than 10.

How much is this estimated to save businesses?

He will tell the conference that the changes will save £850m a year. The house building reforms will save businesses £60m a year, according to the government.

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Overall the Department for Environment, Food, and Rural Affairs (Defra) will slash 80,000 pages of environmental guidance by March 2015 accumulating in a saving for businesses of £100m per year, according to the government.

What other benefits does the government plan to pass onto small businesses?

A package of business rate relief of £1.1bn, £100m of broadband vouchers to help businesses get online, and up to £2,000 each in growth funding for 20,000 small businesses.

What has the FSB said about these changes?

Mike Cherry, the FSB’s policy chairman, speaking to the BBC said:

The government must focus on how they can support these businesses in job creation and growth while the UK’s large businesses need to play their part, too, in supporting ambitious small businesses, for example, through paying their smaller suppliers promptly.

He added that the UK could learn from the US’s Small Business Administration (SBA), which he says has a large budget and long-term strategy.

The UK government should look at whether an institution built along the principles of the US SBA is needed – bringing together business support, export guidance, public procurement, and other small business functions into one place, providing a powerful small business voice within government.

What have others said?

Karen Mills, former head of the SBA and a former member of President Barack Obama’s cabinet, who is also set to address the conference, told the BBC: “As governments look to the future, their plans have to be centred on growth, and the primary currency should be well-paying jobs.”

She added: “When small business has a seat at the table, we can more effectively focus on entrepreneurship and innovation, which are critical components to a strong economic game plan in today’s world.”

Shadow business secretary Chuka Umunna has pledged that Labour will also create a similar body to the SBA to support small firms in their dealings with government departments.

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