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Government 'ignores SMEs when planning regulation'

Published On 4 April 2007 at 08:36:29

The process that the government uses to assess what impact new regulation will have on the economy regularly ignores the concerns of small and medium-sized businesses (SMEs), a new report suggest.

According to the British Chamber of Commerce (BCC), 16 per cent of the Impact Assessments (IAs) that the government carries out do not analyse what impact the new laws will have on SMEs.

Furthermore, eight per cent of the IAs that do take account of SMEs ignore the additional costs that these sort of businesses typically accrue.

Similarly, EU Regulatory Impact Assessments (RIAs) also fail to take the interests of SMEs into account. According to the BCC, 98 of the 160 EU RIAs produced between 2003 and 2006 did not consider the cost of new regulation to SMEs at all.

"Our research highlights the need for the government to ensure that departments are applying the RIA process rigorously to new policy proposals," said Sally Low, the director of external affairs and policy at the BCC.

"What is most worrying is that government, at both at UK and EU level, are failing to think small first. Considering that SMEs employ most of the private sector workforce and are the drivers of growth across Europe, this is a deeply concerning omission."

Recently, the BCC published their Burdens Barometer, which showed that red tape and regulation cost the UK economy £55 billion since 1998.

 

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