SMALL businesses in the North West lose more than £1billion every year, due to government red tape, new figures have shown.
Research carried out by small business lobby and support group the Forum of Private Business (FPB) has found that firms in the region spend around £1,053 million each year complying with legislation.
The figure, calculated using feedback from the FPB’s members, gathered as part of its quarterly referendum ballot, means entrepreneurs in the North West face the third biggest bill out of a total of 12 regions for dealing with the paperwork associated with running a small business. Only businesses in London and the South East pay more, spending around £1.2 and £1.4 billion respectively.
The £1,053m figure for the North West, based on the amount of company time – and therefore money – spent complying with laws and regulations, includes £234m spent on health and safety legislation, £27m spent dealing with paperwork on employment law, and £30m on dismissals and redundancy.
The work associated with staff absences cost £44m, while dealing with maternity matters came in at £26m and disciplinary issues at £37m.
The not-for-profit FPB is now urging the Government to cut down on the burden of regulation for small businesses after this latest ‘cost of compliance’ referendum survey found that, nationally, regulation costs the UK’s smaller business employers almost £12 billion per year.
The FPB’s survey found that, on average, small business employers devote 37 hours each month to complying with regulations. The FPB believes that reducing the time and cost of complying with legislation must not be sidelined, particularly as many firms are struggling to survive because of the recession.