Commons Sense

House of Commons · Ministers' Questions

Regulatory Costs: Small and Medium-sized Enterprises

Thursday 7 March 2024 · 2 questions

Summarised by AI from the official record, so it can contain mistakes.

Read the full transcript on Parliament.uk

At a glance

Answered 2 Partly answered 0 Not answered 0

Key points

  • Christine Jardine questioned the potential impact of regulatory costs on small and medium-sized enterprises in her constituency.
  • The Minister responded with details of the smarter regulation programme aimed at reducing regulatory burdens on SMEs.
  • The Minister acknowledged difficulties faced by the hospitality sector and mentioned the provision of 13 billion in business rates support.

Topics (select to filter)

Questions & Answers

Q1 Christine Jardine Lib Dem Edinburgh West
Business & Trade
Context

The question arises from concerns about the regulatory burden placed on small and medium-sized enterprises, especially regarding employment law and working time directive requirements.

Question

If she will make an assessment of the potential impact of regulatory costs on small and medium-sized enterprises. The questioner notes that there is a significant concern within her constituency about the cumulative effect of regulatory compliance costs on SMEs' profitability and sustainability.

Answer from Kevin Hollinrake

We are hacking through red tape with our smarter regulation programme. We have announced reforms to employment law and recording requirements under the working time directive which will save UK businesses up to £1 billion, particularly benefiting SMEs.

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Q2 Christine Jardine Lib Dem Edinburgh West
Scotland Business & Trade
Context

The question stems from concerns about the high failure rate of businesses in Scotland, particularly those in the hospitality sector. The MP highlights that more businesses have closed than opened since a certain point and calls for comprehensive reform to the business rates system.

Question

I note that the Minister welcomed yesterday's Budget as helping small businesses, particularly in the hospitality sector, which is very hard hit in my constituency. Many businesses report problems with the current business rates system; more businesses have failed than established over two and a half years. In Scotland, downsides of this Government's policy are passed on by the Scottish Government but benefits aren't reciprocated. We want complete reform—not just tinkering—but widespread change. Can the Minister tell us if such reforms are planned? How would they be implemented to ensure businesses in Scotland also benefit?

Answer from Kevin Hollinrake

I agree with the hon. Lady about difficulties in hospitality; I speak to entrepreneurs who struggle. We provided £13 billion of business rates support including £4.3 billion last autumn passed on to Scottish venues, but none was passed on by them. A typical pub in Scotland is £15,000 worse off than one in England; a guest house is £30,000 worse off. Failure rate in Scotland is 30% higher; Wales has a 19% higher failure rate. Critical that benefits are passed on and we look for structural reform. Scrap business rates? Need to show where £22.5 billion comes from.

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