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£2.2 BILLION COST OF RED TAPE TOO HIGH FOR WELSH BUSINESS

Like many, I was surprised to read about the UK Government’s record on unnecessary red tape on business, following new results released last week. According to the British Chambers of Commerce (BCC), the cumulative cost of regulation on British business is now £55.6 billion, an increase of more than £10 million in the last twelve months. Despite promises to the contrary, it is clear that many small firms are simply being drowned in increasing paperwork that takes the entrepreneurs away from running and growing their business.

In Wales, the increase in bureaucracy is becoming unsustainable and,t aken proportionately, the red tape burden on Welsh businesses is over £2.2 billion. This is a sum which is equivalent to over 15 per cent of the entire Assembly Government’s annual budget and six times higher than the entire expenditure by the Department of Enterprise on business support last year. Since 2006, the burden on Welsh firms has increased by over £400 million, which is equivalent to an average of £2300 for every business.

Whilst many large firms can absorb such costs, tens of thousands of small businesses in Wales are struggling to do so, especially when rate relief – a vital part of government support – is well below the levels seen in England and Scotland. The next Assembly Government, with increased law making powers, should make the reduction of unnecessary red tape a vital part of its legislative agenda, and establishing a different regulatory framework that helps small businesses in Wales.

I believe that Government needs to be supportive of small firms and not shackle their ambitions through paperwork and superfluous form filling.

Providing grants with one hand and then adding costs through increased red tape with the other is not the way to develop a business support sector in Wales and it is time that we created a Welsh specific system that puts our small business first and releases them from such burdens to get on with the business of wealth creation and employment growth.

The whole point of devolution is that we can create a system to help Wales, its economy and its society. Let's start by having a small business 'charter' which makes it absolutely clear that any piece of new legislation coming through the Assembly will seek to minimise the amount of red tape on small business.

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