Budget 2005 - Small business inspectorate cull, but many missed opportunities

In his budget speech earlier today, the Chancellor has promised to reduce the amount of red tape UK businesses have to put up with - he said:

"We need to enhance the flexibility needed for a successful economy. So we will reduce the regulatory burden for British business. We will reduce 35 regulatory agencies to just nine. For companies meeting the highest standards there will be a major reduction in inspections they face."

Brown will also encourage small businesses to take up the simplified VAT arrangements available to them, but will increase the penalties for non-compliance. Corporate and Company Car tax are frozen.

A leading business pressure group is warmly welcoming the commitment to slash the inspection burden on small businesses, simplifying of the tax regime and to encourage vocation based training.

The FPB welcomed the commitment to continued economy stability but FPB Chief Executive Nick Goulding criticised the Chancellor's continued complication and burden of the tax regime saying there had been a number of missed opportunities.

Missed opportunities

"The public sector is still monstrously big and squeezes out the private sector. Most new jobs have been created in the public sector and are devouring wealth rather than creating it. The investment that many business owners have made in private child care facilities is being greatly undermined by this budget, which will reduce the quality and diversity of child care."

"Inheritance tax remains a tax on the moderately wealthy which reduces the ability of families to raise the hard cash to actually start a business."

"There is little in the budget to encourage individials to take the giant leap and risk of establishing a business. In particular, women and other under- represented groups such as ethic minorities and those in inner cities who deserve and need more meaningful support.

Minimum Wage

"Small businesses are resolutely opposed to continued rises in the Minimum Wage, which have seen it increase by 34.7 per cent in five years and become a major issue of concern to the small business sector."

Jobs & Skills

"Business owners are crying out for pupils and graduates to have relevant skills to the workplace. The FPB has been campaigning hard to see more cash for employers to help work based training. The extension of the employer work place training pilot to is welcome but again FPB would demand greater investment in vocational training - delivered in the workplace. The £2000 return to work bonus for lone parents will help small businesses in recruiting mature and able staff."

Maternity Leave

"This will be greeted with a sense of utter dread by employers. Maternity leave creates massive operational and organisational headaches for small firms. Increasing paid maternity leave to a whole year is unwise and will only aggravate the problems small firms already face."

Hampton Review and Arculus recommendations

"The reduction of inspection bodies from 35 to nine will be wholly welcomed by small firms who have been confused by the monstrous bureaucracy of regulations. The Government is right to identify the onerous burden of continuous and unnecessary inspections on small firms. The food industry in particular should benefit from a having to deal with fewer regulatory bodies. "

Gold plating

"The UK civil service has to change the way it implements EU law. The present method is fundamentally flawed. The Chancellor must deliver on this promise. As ever the devil is in the detail and small businesses will want to see less complex legislation as a matter of urgency."

Transport

"The FPB welcomes the delay in increasing fuel duty until December. However we would rather the duty increase was scrapped altogether for the entirety of the financial year." The Eddington review announced in the budget delays decision on the urgent need for continued investment in Britain's inadequate transport infrastructure. Small businesses desperately want to see greater investment in transport."