Business leaders ‘crying out’ to cut red tape

Prime Minister David Cameron said the dossier of legislation and regulations which are hampering firms would “help to shift the debate” in Europe.

The Government-commissioned report by business leaders highlighted the 30 worst threats to small firms. The Prime Minister has sent the document to the leaders of the other EU member states ahead of a summit next week. To underline his intent, Mr Cameron took the unusual step of inviting the authors of the report to present their findings to the weekly Cabinet meeting in Downing Street.

Entrepreneur Dale Murray told the Cabinet: “This is not just the view of British business. We had submissions from a lot of European businesses, as well as business organisations. The response has been quite fantastic.”

Kingfisher boss Ian Cheshire told Ministers they were “pushing at an open door” on deregulation and the UK could “construct a business alliance” urging action.

The group, which included Marks & Spencer chief executive Marc Bolland, painted a stark picture of the impact of bureaucracy, especially on smaller firms.

They said “problematic, poorly-understood and burdensome European rules” slowed production, job creation, sales and innovation and left Europe trailing international trading rivals.

Among the priorities for action in the report was tougher enforcement of the EU services directive to prevent some member states exploiting flexibility to impose “unjustifiable barriers” to trade. It called for small businesses in low-risk sectors to be exempted from keeping written health and safety assessments and one-man gardening and carpentry outfits from having to register to transport waste.

Other targets of the report were fears of “overly strict” new rules for labelling meat with its origin of both rearing and slaughter, plans to force food firms to cover the costs of quality controls, country of origin labels for non-food products and the £300m UK impact of new data protection rules.

Plans for extended EU-wide maternity leave rights would cost UK businesses £2.5bn and should be halted, it suggested, and the working time directive should be made clearer on issues such as leave not being allowed to carry over and workplace “on-call” time not counting as working hours.

A proposed cap on seller fees on card, internet and mobile payments should be fast-tracked, the report concluded – and added another 66 areas of concern to its 30 priority reforms. On top of its recommendations for immediate action, the taskforce proposed a “common sense filter” to ensure new regulation was pro-growth and could be balanced by cutting red tape elsewhere.

Opening the Cabinet meeting, Mr Cameron said: “A lot of people have spoken and written about how we need to cut EU red tape but I can’t think of a report that has gone into more detail about exactly how to do it. The strength of the report is it has got both the principles that need to be applied in dealing with EU regulation and legislation, what needs to change, but also a whole lot of very clear, very specific examples.”

However TUC general secretary Frances O’Grady was critical. “If the Government accepts these recommendations, workers in the UK could end up with less holiday leave and more unpaid hours if they’re on call, while mums will have less time off work to care for their new baby,” she said.

“None of these policies have anything to do with economic growth and are instead about certain business leaders’ desire to worsen people’s basic working conditions, egged on by the Government.”