Reforms cut £350m of red tape on firms

A RAFT of micro reforms to planning laws and business regulation were introduced in the Budget to boost growth in UK enterprise yesterday.

Key supply-side reforms included sweeping changes to planning laws, to wave through applications for sustainable development and tear up nationally-imposed targets on the use of brownfield land.

“We will introduce a new presumption in favour of sustainable development, so that the default answer to development is ‘yes’,” chancellor George Osborne said.

Osborne pledged to scrap £350m of regulation on business and exempt all start-ups and businesses with fewer than ten employees from all new UK regulation for three years.

Industry groups welcomed the moves. “Reductions in regulations on businesses and the promise of a faster planning system will provide relief to companies trying to take on staff and invest,” said CBI director-general John Cridland.

“Small companies will be central to creating jobs and rebalancing the economy. These measures and a moratorium on new regulation and exemptions should be encouraging to those companies,” said Ernst & Young ITEM Club chief economic adviser Peter Spencer.

Further pro-business measures included revising employment tribunal procedures and extending to two years the time employees must work for a company before they can sue for unfair dismissal.

The government will also minimise the health and safety burden on business by implementing reforms recommended by Lord Young.

The Association of British Insurers welcomed the move. “Lord Young rightly identified how badly interpreted or misunderstood regulation, bureaucracy and disreputable claims management firms have contributed to a compensation culture,” said ABI director of general insurance and health Nick Starling.

But others warned the planning regime changes may be hard for local communities to accept.

“The success of these changes will ultimately rely on local people accepting development in their back yards and the government could become the architect of its own demise if its drive to empower local communities pulls the rug from under its pro-growth agenda,” said John Brooks, planning director at property firm DTZ.