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.
'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
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
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.
'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
'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
'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