RECOMMENDATION U: CHIEF
In view of assurances that the Committee's detailed
recommendations on the role of the Chief Executive of the SBS
would be taken into account, it would be helpful to have a response
to each of the four points raised in recommendation (u)
The Small Business Service (SBS) has been working
closely with all Government Departments to ensure that the Chief
Executive must be consulted at the earliest stages of the policy
making process if Government legislation is likely to impact on
small firms. The SBS has also worked alongside the Cabinet Office
to enshrine the "think small first" principle throughout
the new Cabinet Office guide "Good Policy Making: A Guide
to Regulatory Impact Assessment". The guide reminds departments
to consider the implications specifically for small businesses
at the earliest stages. It puts the SBS at the heart of policy
making. The Chief Executive has attended all the meetings held
by the Panel for Regulatory Accountability, and is working to
ensure quality and timely consultation, alternatives to regulation
when appropriate, sensible regulatory timetables, appropriate
enforcement and easy to follow and timely guidance for small businesses.
The Regulatory Impact Assessment must record whether or not the
SBS has been consulted and also has the right to have its views
recorded in the RIA.
RECOMMENDATION W: COMPREHENSIVE
The committee has asked for a progress report
on the development of a Comprehensive Business Directory and the
prospects for the compulsory regulation systems referred to
The principle of a Comprehensive Business Directory
that draws on administrative sources in various Government Agencies
is accepted. The inter-departmental project is currently researching
the necessary legal framework for such a facility and in tandem
developing prototype models to determine the most effective implementation.
The legal research is essential to ensure that developments would
not infringe upon government confidentiality and basic human rights.
The project team is working closely with other related projects
within government, including the Office of the E-envoy and PIU,
to ensure consistency and mutual benefits are gained. Results
are targeted for March 2001 and further developments can be expected
to be provided as part of the Government Secure Intranet knowledge
Government announced in April its decision to
remove the statutory audit requirement for all companies with
a turnover up to £4.8 millionthe maximum level allowed.
This reform will save business up to £180 million a year
and will be achieved in two stages. First raising the threshold
to £1 million and then, after considering the recommendations
of the Company Law Review on what, if any, new statutory requirement
should be put in place, to £4.8 million.
Business, Enterprise and the Budget, Seventh Report
of 1999-2000, HC 51: Government Response Seventh Special Report
1. The Committee decided to follow up the
November 1999 Pre-Budget Statement with evidence on a number of
matters arisings therein, on which it heard oral evidence in December
1999, and January and February 2000, and reported in March 2000.
The Report covered five special fiscal proposals of particular
concern to industry; the latest proposals on the Climate Change
Levy on which the Committee had reported in July 1999; the proposed
Phoenix fund to encourage entrepreneurship in disadvantaged areas;
and the general issue of the low level of institutional investment
in high tech firms.
2. The Government reply was received in
May 2000, and was generally positive. Some of the conclusions
have now been given effect in the Pre-Budget plans announced in
November 2000. The Chancellor's appointment announced in the 2000
Budget of Mr Myners to look into factors discouraging institutional
investors from investing in SME may have owed something to the
interest shown by the Committee.
3. The Committee continues to pursue many
of the issues raised through, for example, written questions on
the recent Pre-Budget Statement.