Red tape 'has cost firms £6bn' under Labour Government
Monday 16 June 2003
Extra red tape regulations have cost UK companies £6bn since Labour came to power in 1997, according to the Institute of Directors.
The IoD attacks a string of new rules it believes have been too onerous at a time when companies have struggled to cope with the economic downturn, high taxes and problems for exporters due to the strong pound.
The most costly and time consuming new regulation has been the imposition of the national minimum wage in April 1999, which the IoD calculates has cost business £2.7bn. The second most expensive piece of legislation has been the Working Time Directive, which restricts the number of hours an employee can be forced to work, at an estimated cost to companies of £2.3bn.
Ruth Lea, head of policy at the IoD, said: "This country has to make a choice between a free and lightly regulated labour market, on the one hand, and intrusive and heavily regulated labour markets, high taxes economic stagnation and weak job creation on the other. There is no third way."
New legislation has also been very time consuming, the IoD found. Small companies have been particularly hard hit and have had to spend an average of six hours a week dealing with red tape. Some companies have had to take on extra staff in order to address all of the demands of the new regulations, the business body found.
Tim Yeo, the shadow trade secretary, condemned the amount of new legislation. He said: "While British business has been paying the £6bn a year extra cost of new regulation under this Government, business investment is at its lowest level since 1991. We have the largest trade deficit for over 300years, productivity is rising at half the rate as under the last Conservative government, and the manufacturing sector is shedding 2,000 jobs a week."
The IoD has raised concerns about the impact of the Working Time Directive on the ability of UK companies to compete with rivals.
The directive, which was part of last year's Employment Act, awarded more pay for men and women on maternity and paternity leave and introduced equal pay questionnaires as well as statutory procedures to deal with internal grievances.
- 1 I was a Woman Against Feminism too
- 2 Fifty Shades of Grey movie trailer released: First look at Jamie Dornan as Christian Grey
- 3 Is Gideon Levy the most hated man in Israel or just the most heroic?
- 4 Students offered grants if they tweet pro-Israeli propaganda
- 5 The Tory donor whose firm is one of Britain’s biggest tax avoiders - with HMRC's blessing
Malaysia Airlines MH17 crash: Vladimir Putin is given 'one last chance' to end hostilities in Ukraine
The 'scroungers’ fight back: The welfare claimants battling to alter stereotypes
The truth about conspiracy theories is that some require considering
Arizona execution lasts two hours as killer Joseph Wood left 'snorting and gasping' for air
Malaysia Airlines MH17 crash: Ukrainian military jet was flying close to passenger plane before it was shot down, says Russian officer
Malaysia Airlines MH17 crash: Massive rise in sale of British arms to Russia
iJobs Money & Business
£18000 - £20000 per annum + OTE £25K: SThree: SThree Group has been well estab...
competitive: Progressive Recruitment: This really is a fantastic chance to joi...
£40000 - £60000 per annum + BONUS + BENEFITS: Harrington Starr: CXL, Triple Po...
£60000 - £75000 per annum + BONUS + BENEFITS: Harrington Starr: Business Anal...