Government to help start-ups beat red tape

START-UP companies in innovative sectors will have assistance to avoid regulations designed for established firms, the government will announce today.

It will task an independent committee with identifying rules that hinder so-called “challenger businesses”, mainly in the technology sector, that often have unusual working practices but help economic growth.

“Challenger businesses create wealth and jobs – we should champion them at every opportunity. I don’t want these pioneers falling foul of outdated regulations,” business minister Michael Fallon will say in Sheffield.

The proposals are based on research published today by Mark Littlewood, chief executive of the Institute of Economic Affairs.

“Upstart, challenger businesses which provide alternatives to the established order too often find themselves in a sort of legal twilight zone, whereby regulations designed for a very different world simply aren’t appropriate or even comprehensible,” said Littlewood.

However the government rejected his call for start-ups to be allowed more flexibility to hire and fire workers by letting such firms treat workers as self-employed for a lengthy period.