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Research Suggests Small Businesses are Held Back by Red Tape

Research Suggests Small Businesses are Held Back by Red Tape

John Lawrence of Tennyson Suite and James Irvine of Renewtech Energy.

Basepoint, which operates 28 business centres across the Midlands and the South of England, recently surveyed its licensees to find out what impact the coalition government’s policies are having on small and new businesses.

Of the 360 respondents that took part, 57% said their businesses will benefit from a cut in corporation tax, while 42% believe that more could be done to cut red tape – despite the government’s pledge to reduce it. Those respondents also feel that bureaucracy is holding smaller businesses back from expanding.

A number of Basepoint tenants commented in their survey response about the various problems they are facing, such as Noel Greaves of Copperfields Financial Management, based at Basepoint’s Tewkesbury location.

Noel commented: “As a business that deals with finances all day long, many of our clients find corporation tax can be mitigated by various means. But what smaller businesses like ourselves can’t mitigate, is the red tape we have to deal with. We’d like to see this reduced for all companies, so that they can get on with helping to rebuild this country’s economy.”

Fiona Ellis of Clarifi Consulting, which provides management and consultancy services to the public sector from their base at Basepoint Ipswich, said: “Cuts in corporation tax do help, but there’s too much red tape surrounding government processes, especially as a smaller business working with the public sector.

“It would really help us if these processes were simplified and shortened.”

High Wycombe based Simon Smith of employment consultancy Driveline commented in his response that the government’s decision to raise National Insurance is another unpopular move, saying that the timing is problematic.

“Now has also been a really bad time to increase National Insurance,” he said. “I think the government should give all employers with new staff a 12-month NI holiday to incentivise them to take on more staff.”

For the health and safety industry, the current requirement to gain accreditations from separate councils is both an expense and an inconvenience, according to John Lawrence (pictured) of health and safety consultancy Tennyson Suite, based in Newhaven.

“There is no one single body that governs the health and safety industry, so we have to spend ┬ú5,000 each year on accreditations from a wide range of bodies and councils,” he says.

“The clients we work with expect us to have several, if not all of these. Why is there not just one accreditation body for all small businesses? Something like this would help smaller businesses to compete more easily with larger firms, as well as saving them a lot of money each year.”

Commenting on the survey, Brian Andrews – Executive Director of Basepoint Business Centres – said that the results are evident of the numerous “blockages” still preventing small businesses from progressing, and urges the government to address these issues.

“This is a crucial time for small businesses as the economy stutters along the road to recovery,” he said. “The coalition needs to appreciate that there are still considerable blockages that need to be removed if we are to see our small businesses throw off the shackles of the past and begin to develop into the growing economy.

“The coalition needs to embrace a business culture that develops and nurtures – not one that lives in the past and puts up obstacles. It’s tough enough without the additional burden of outdated and unnecessary red tape. Let’s hope that the Government’s ‘Red Tape Challenge’ does actually act to swiftly resolve these burdens.”

Find out more about the Red Tape Challenge here.

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Author: | June 27, 2011 | 0 Comments

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