March 25, 2011
Following the government's latest Budget, arguably the most important in a generation, business groups have offered a mix response to a slew of measures aimed at changing taxing systems and working practices.
Delivering the 2011 Budget this week, Chancellor George Osborne said his policy objective is “to achieve strong, sustainable and balanced growth that is more evenly shared across the country and between industries”, and that he wants to make the UK “the best place in Europe to start, nonce and grow a business”.
Under the terms of the Budget, business regulations which would have cost over £350m a year to implement will be dropped, such as the right to request time to train will not be extended to businesses with fewer than 250 employees.
SMEs and start-ups will also be exempt from new domestic regulation for three years from 1 April 2011, following a moratorium, while 21 enterprise zones will be launched and there will be a consultation on the long-term plan to merge income tax and National Insurance, added Mr Osborne.
Comment on the Budget hasn't been lacking since Mr Osborne’s major announcements this week, and The Federation of Small Businesses (FSB) said it was “pleased that the Government understands that the burden of regulation hinders businesses across the UK and that it has imposed a three year moratorium on new regulation for micro-firms”.
However, TUC General Secretary, Brendan Barber, said "Today has been a no-change budget” but rather a “deterioration of working conditions that failed to deliver jobs or growth.”
And the TUC isn't the only critic, with Mike Emmott, CIPD Employee Relations Adviser, commenting:
“We are concerned about the moratorium on all new employment regulation for small firms for three years. The onus should be on government to bring forward only light-touch employment regulations that do good, not harm – irrespective of company size.
“A moratorium for the smallest firms is a dangerous precedent that risks creating a two-tier labour market, and could even at the margins act as a perverse disincentive for growth amongst firms considering employing the extra staff member that would bring them into the ‘regulated tier’ of the labour market.”
Businesses struggling to get their heads around the government's plans, are being advised to seek expert advice as soon as possible to make sure they make the most of an ever changing business landscape.
