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MEASURES TO CUT RED TAPE & REDUCE BURDEN ON BUSINESS

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Trade and industry secretary Stephen Byers has announced new ...
Trade and industry secretary Stephen Byers has announced new

measures to cut red tape and reduce the regulations on business.

The proposals announced by Stephen Byers will benefit thousands of

businesses and reduce their costs by tens of millions of pounds.

He said:

'It is clear to me that government needs to rethink its approach to

regulation if we are to make a real difference to businesses up and

down the country. That's why I have asked my department to carry out

a systematic review of the regulations for which I have

responsibility.'

He outlined the approach his department will take in the future:

'We will have a presumption against regulation. Regulations will only

be introduced where absolutely necessary and where all other avenues

have been pursued.

'Where regulation is necessary, we will ensure that it is as simple

and user-friendly as possible.

'We will 'think small first', ensuring that from the outset,

regulations and associated guidance are developed with the needs of

small business to the fore. The new Small Business Service will have

a key role to play here.

'We will work with enforcement agencies to ensure that our

enforcement is business-friendly and supports business efforts to

improve productivity and performance.

'To help in this task, I am very keen to have business's direct

input. That's why today, I want to ask business to provide secondees

to my department to help in our drive to cut red-tape. I am

particularly keen to involve those from small businesses, so the use

of secondees can be on a part-time basis to meet the needs of small

business.'

Stephen Byers announced three specific changes to regulation: changes

to the Working Time Directive guidance; the lifting of the audit

threshold and a pledge to consider sunset clauses under which

regulations would lapse after a fixed term unless renewed.

He said:

'We have been listening carefully to what business has said about the

complexities of the new Working Time Regulations. We will be

publishing revised guidance on the Regulations in the next few weeks.

The new guidance will make clear that for the vast majority of

British businesses, existing documentation and systems already meet

the Working Time record-keeping requirements. I want to emphasise

this point. The vast majority of businesses are already doing enough.

'The guidance will also clarify that the vast majority of individuals

do not need to keep a specific record of the hours they work. Where

workers have agreed hours set in their contract - as is normally the

case - then copies of these contracts and a quick check they are

being followed should be sufficient. If staff are paid overtime for

further hours worked, the payroll should provide sufficient

information.

'Already, the limits do not apply to directors and executives and

other so-called 'autonomous workers' - people who often find it

difficult to measure when they are working and when not. Under the

revised guidance, it will be clear that more people can benefit from

this exemption and do not need to keep records of the hours that they

work.

'I can also announce my intention to consult on lifting the audit

threshold (at which companies have to have their accounts

independently audited) from its current level of£350,000 to a higher

level, possibly up to the maximum allowed under the EU Company Law

directives of£4.2m. Any change could potentially benefit

thousands of companies. For example, lifting the threshold to

£2m would lift the audit requirement from 150,000 companies.

The Federation of Small Business estimate that a company with a

turnover of£1m will save£5,000 a year.'

The secretary of state also announced he is considering introducing

'sunsetting' for some future regulations:

'I think the idea of regulations with an expiry date is an attractive

one. In some areas, particularly in rapidly changing industries,

there may be a case for sunset clauses in new regulations. This would

mean that a regulation would only be in place for a fixed term and

would then automatically lapse if not renewed.'

In concluding, Mr Byers said:

'We are clear that there will always be a place for regulation to

achieve certain goals. When used sensibly and sensitively, regulation

can work for business as well as those who would otherwise be

directly at risk but I see regulation as a last resort.

'In today's competitive markets we can ill-afford to burden UK

businesses, particularly the UK's vital small businesses, with

unnecessary red-tape or disproportionate requirements. Instead, we

must focus on giving small business the freedom, the incentives and

the support they need to survive and prosper and to become the

engines of growth for the British economy that we all want them to

be.'

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