Priti Patel
Main Page: Priti Patel (Conservative - Witham)
Priti Patel (Witham) (Con)
I welcome this Bill, particularly the Government’s commitment to cut the cost of regulations in order to support business growth. I say that as someone who spent 30 years growing up literally on top of small businesses, as that is what my family did. There is so much to commend in the Bill. We have heard from right hon. and hon. Members this evening who have focused on regulation. I think that Ministers should be commended for all their efforts, however, as they have demonstrated their desire to keep Britain open for business by keeping tax, particularly corporation tax, low. That applies to small profits rates, too, which were due to increase under Labour. These welcome steps are in complete contrast to what Labour proposed.
I shall focus my remarks on regulation, even though it has been touched on already. I believe that using fiscal levers and taxation policy alone to stimulate private sector economic growth and to encourage entrepreneurship can go only so far. Lower taxes, for example, must be complemented by a significant reduction in the costs and burdens imposed by regulation. That is why this legislation is not only welcome but urgently needed.
Business men and entrepreneurs, particularly small businesses, do not want to spend their time, often late into the night, filling in forms, ticking boxes and dealing with bureaucracy, regulation and red tape. That takes a disproportionate amount of their time when they could be running their businesses. They want to be able to take risks, grow their businesses and create jobs rather than be swamped in bureaucracy and red tape. I think that the proliferation of red tape over recent years is a damning indictment of the last Government’s record in office and their failure to support businesses. The regulatory framework they left behind has been deeply damaging to the growth of our economy.
The Forum of Private Business has estimated the cost of compliance with regulations at something like £16.8 billion, with the average cost per business totalling around £14,000. These are astonishing figures when we think that the annual cost of compliance is equivalent to the amount spent on Crossrail or 11 times the total Government budget for apprenticeships alone. These are deeply alarming figures. If even a modest amount of those costs could be removed, Britain’s 4.5 million small businesses would be more competitive internationally, able to reduce costs for their customers and to expand to create more jobs and growth domestically.
We have heard much this evening about regulations in the sphere of employment law, with 107 new employment regulations added since 1998. The consequences are clear to anyone who has had any experience of small businesses. I hosted the reception for the FSB earlier this evening; it has stressed the disproportionate impact of these regulations, seriously affecting such businesses.
There is no doubt that businesses large and small will welcome clause 49 and the introduction of sunset and review clauses into regulation. Those measures build on “Sunsetting Regulations: Guidance”, published by the Government in December, which recommended that regulations which impose burdens on businesses be reviewed more frequently—within five years—and should expire within seven years. That is important, because the cost of regulations can spiral, and they can have a disproportionate effect. However, I urge the Government to ensure that those regular reviews of regulations not only take place but lead to changes when the burdens imposed on business are too great. Ministers have an opportunity to focus on what is working and what is not. We have already heard about one in, one out. My preference would be for no regulations in and a lot of regulations out, and the same applies to Europe, but at this stage Ministers need to focus more on what needs to be scrapped in order to free up businesses.
In the brief time available to me, I want to touch on the international dimension of enterprise and regulation. Last month I had the privilege of visiting London Gateway, which is an expanding part of the county of Essex. As an Essex MP, I am proud to represent the entrepreneurial spirit that can be seen there. There is a colossal amount of entrepreneurship in Essex, and London Gateway is a very good example of a selling point for UK plc. In the face of many regulatory hurdles, foreign direct investment in the UK has helped to develop the site into an incredible new port and logistics park which will create a great many jobs and boost our economy, just on the cusp of London. I think that Ministers could learn from some of the challenges that have been met there, and could find ways of bringing more foreign direct investment to the UK and showcasing it, and London, internationally. The selling point would be the removal of many of the regulatory burdens that we have seen in the past, but with which the Government are now dealing.
I urge the Government to press ahead with the Bill, and to embark on a radical programme of deregulation and regulatory reform. That would encourage more businesses like DP World, and even Tata and Glaxo, to follow in their investment footsteps, and to create more jobs and economic growth in this country.