Red tape "costs small firms 24 days a year"

Small businesses are spending the equivalent of more than a full working month each year on dealing with government legislation and regulation, according to research conducted by BT.

Small firms were found to devote a total of 24 full days to "non-core activities", such as setting up measures needed to adhere to government law. Finance, IT and HR departments were the worst affected.

The report argues that, in more than half of businesses, the single most dominant concern for business owners is now the strain of coping with red tape. Only 27% of those surveyed pointed to more traditional issues such as cashflow or finances, and many said that they saw red tape as the key barrier to small business growth.

Forum of Private Business (FPB) speaker Phil McCabe criticised the Chancellor, Alistair Darling, for failing to heed the problems of small firms in this area.

"A wide-ranging review of the burdens of employment law took place last year," he said. "The FPB submitted some detailed data on health and safety, parental leave and sick pay concerns, none of which seems to have made it into this bill."