New Regulations spark Red Tape concern
A raft of new business regulations introduced on 1 October will create more red tape for small firms, business groups have warned.
New rules brought in on the October ‘common commencement date’ — one of two days in the year when government departments introduce new business regulations at the same time — included amendments to health and safety legislation, company law and consumer protection.
One of the biggest changes is the increase in the national minimum wage, which rose from £5.52 to £5.73 an hour for an adult aged 22 and over. For workers aged 18 to 21, the rate increased from £4.60 per hour to £4.77 per hour.
The British Chambers of Commerce (BCC) called the minimum wage rises “modest and sensible” but pointed out that many businesses will struggle to cope even with small cost increases in the current economic climate. BCC spokesman Sam Turvey said:
“As the UK moves into uncertain economic times and credit is squeezed, businesses will be operating on much tighter margins. It’s important that the Low Pay Commission ensures fair pay, but it must continue to balance this against the ability of employers to cope with the additional financial burden.”
Other rules effective from 1 October included a minimum age of 16 for company directors, and the abolition of court approval for private limited companies wishing to reduce the amount of their share capital. Annual returns of private companies made up to or after 1 October 2008 need only include the names, but not the addresses, of shareholders.
The Federation of Small Businesses said that some changes might reduce paperwork for firms, but others place the burden of enforcement too heavily on business owners. FSB spokesman Stephen Alambritis said:
“We’re concerned that small businesses are being asked to provide too many things. The fact that Energy Performance Certificates, for example, are now required by all businesses will add to the many hours a week that business owners already spend on complying with regulations.”
FSB Chairman John Wright claimed the volume of legislation threatened to overwhelm small firms.
“Businesses will be expected to tackle around 20 new regulations,” he said. “This goes against government pledges to cut back. In these tough times, it is important for small businesses to remain economically active rather than spending their time filling in forms.”
Read the Business Link guide to new business regulations introduced on 1st October 2008