Tories vow to slash 'burdensome' red tape for business by £10bn

Axe In Wood

The new business secretary Sajid Javid is to pledge to cut red tape for companies by at least £10bn during the current parliament as he announces details of the enterprise bill that will form part of this month’s Queen’s speech.

Making his first speech since replacing Vince Cable, Javid will say that the government’s plan to preside over the creation of 2m jobs in the next five years will involve making Britain the best place in Europe to start a new business.

However, alongside the proposed assault on bureaucracy, the business secretary announced plans for a new government-funded body to help small businesses recoup the more than £30bn owed to them in late payments of bills.

The creation of a small business conciliation service was part of the Conservative manifesto and Javid said the proposal would help to settle disputes.

“Small businesses are Britain’s engine room and the success of our whole economy is built on the hard work and determination of the people who run and work for them,” Javid will say in a speech in Bristol, where he grew up in a flat above his parents’ shop.

“As business secretary, I will always back them and, in my determination to get the job done, one of my first steps will be to bring forward an enterprise bill that helps them to succeed and create jobs.

“As part of our long-term economic plan, we will sweep away burdensome red tape, get heavy handed regulators off firms’ backs and create a small business conciliation service to help resolve disputes.”

It is estimated that small businesses are owed £32bn in late payments but are often unaware of their rights or are reluctant to take legal action, fearing they will lose future business. The enterprise bill will extend the fight against red tape beyond Whitehall and for the first time include independent regulators.

Javid’s plans were welcomed by John Allan, chairman of the National Federation of Small Businesses. He said: “Our members have been clear on the need to make progress on cutting burdensome red tape and on addressing issues like the billions owed to small businesses in overdue payments.

“These are not easy issues to tackle and we will need the minister to work closely with our members and the wider business community to find solutions. We look forward to working with the business secretary and his team over the coming months.”

Powered by Guardian.co.ukThis article was written by Larry Elliott Economics editor, for theguardian.com on Tuesday 19th May 2015 00.01 Europe/Londonguardian.co.uk © Guardian News and Media Limited 2010