Government cuts to regulation have saved British businesses £10 billion over the past 4 years, the Department for Business, Innovation and Skills has announced.
The drive to reduce regulation – known as the Red Tape Challenge – is backed by 30,000 businesses and members of the public and is designed to ensure that regulation works in favour of business.
Under the policy, government departments are required to find savings of double the amount of any new regulation introduced.
The government estimates that £20 billion of savings could be made by 2020 by scrapping regulations.
Businesses are benefitting from reduced regulation in several areas:
- changes to company law have allowed small businesses more freedom to decide whether to audit their accounts, saving businesses at least £300 million a year
- employment reforms have reduced the likelihood of workplace disputes going to an Employment Tribunal, saving £24 million a year
- planning guidance has been reduced by 80% and online guidance has been simplified
- unannounced health and safety inspections have been stopped on low-risk businesses such as offices and shops.
Adam Marshall, executive director of policy and external affairs at the British Chambers of Commerce, praised the government for its “real and concerted effort” to tackle regulation.
Mike Cherry, national policy chairman at the Federation of Small Businesses, urged the government to do more to remove regulatory burdens faced by businesses:
“While we all welcome these cuts in red tape, it’s clear that there is always more to do to improve domestic regulation and that coming from the EU. Concerns surrounding new areas of stress, like the coming rules on how VAT is applied to digital services sold in Europe, show that regulation will continue to be a key concern to businesses now and beyond the next general election.”