Under a 'rigorous' cross-government assessment process, firms will also be exempt from any new regulations if there is evidence to show they create a disproportionate burden that could impede growth for these businesses.
Announcing the proposals, the Business Minister Michael Fallon said, 'On my watch, new regulations will now only extend to small businesses if they are essential, justified, and where disproportionate burdens are fully mitigated. And where regulation is not fit for purpose it will be reformed or binned'.
The move has been welcomed by many of the UK's leading business groups, which have long called for more action to reduce the red tape burden on small enterprises.
John Allan, National Chairman of the Federation of Small Businesses said, 'The Small and Micro Business Assessment should help to make future regulation more manageable and proportionate for the smallest firms, and is to be welcomed. This should mean that business owners will be able to devote time to growing their business and creating jobs rather than form filling'.
Meanwhile, Hayley Conboy, CBI Principal Policy Adviser for Enterprise, commented, 'Regulation disproportionately affects smaller businesses which lack specialist resources to manage it, so this extension to the moratorium will help free up more of these firms to focus on growth.
'However, it does not apply to many new rules impacting on companies so must not distract from the need for the Government to always 'think small first' when designing regulations. This will ensure that all firms can comply without disproportionate cost'.
