The Government is committed to fostering and encouraging the entrepreneurial spirit that thrives in the UK. The Small Business, Enterprise and Employment Bill is designed to reduce the barriers that can hamper the ability of small businesses to innovate, grow and compete. It paves the way for Government to be more supportive of small business in the UK.
This Bill will open up new opportunities for small firms to innovate, compete and get finance to create jobs, grow and export. Small businesses will have access to finance and reduced red tape to thrive so that honest hardworking businesses can be confident in the rule of the law and aren’t disadvantaged by those that don’t play by the rules. It will ensure that the UK continues to be recognised globally as a trusted and fair place to do business.
The following measures are included in the Bill;
1. Public Sector Procurement
2. Access to Finance
3. Regulatory Reform
4. Companies: Transparency
There should be a simple and consistent approach to procurement across all public sector authorities so that small businesses can gain better and more direct access to this market. The Bill will introduce measures to;
• Provide government with the ability to implement a number of measures relating to public procurement in the future, as necessary. These will remove barriers for small businesses and make procurement practices across the entire public sector more streamlined and efficient.
• Provide the Minister for the Cabinet Office or the Secretary of State with a general power to investigate procurement processes and practices carried out by UK Government Departments and other contracting authorities, as defined in the Public Contracts Regulations, who are not wholly or mainly undertaking devolved functions.
Many small businesses still struggle to access the finance they need to expand. The Bill will introduce measures to;
• Improve small businesses’ access to finance by removing legal barriers to invoice finance;
• Incentivise businesses to improve their payment policies and practices;
• Encourage greater competition in banking by improving the ability of challenger banks and alternative finance providers to conduct accurate risk assessments and making it easier for small and medium sized businesses to seek a loan from a lender other than their bank;
• Enable UKEF to better support UK businesses engaged, or wishing to become engaged, in exporting or in an exporting supply chain;
• Provide for an innovation called cheque imaging that will make paying in cheques quicker and easier;
• Ensure that the Payment Systems Regulator’s powers on access are aligned with the requirements of the Payment Services Directive and the Settlement Finality Directive.
Unnecessary regulation can get in the way of doing business and impose additional burdens to businesses of all sizes. The Bill will introduce measures to;
• Commit the government to creating a more streamlined process to incorporate a new company and register for tax purposes;
• Review the business appeals procedures via the creation of a Small Business Appeals Champion, ensuring that the complaints and appeals procedures in non-economic regulators are user-friendly for business and that business have an easy pathway to challenge decisions from non-economic regulators;
• Entrench in law the setting of a deregulation target – similar to the “One-in, Two-out” approach – and transparent reporting of new regulatory burdens on business.
• Ensure that all new regulations affecting business are reviewed regularly and that regulations are effective and necessary and not subjecting businesses to unnecessary burdens
• Create statutory definitions for the terms “small business” and “micro business”
• Allow the CMA, at its discretion, to make recommendations on the impact on competition of legislative proposals, which it must then publish.
• Introduce a new power for the Secretary of State to introduce an exemption from liability for bodies concerned with accounting standards to take effect without it being conditional on the awarding of a grant to a body
It is important that the UK is seen as a trusted and fair place to do business. The Bill will introduce measures to;
• Require UK companies to keep a register of people with significant control over the company (a ‘PSC register’). This will increase transparency around who ultimately owns and controls UK companies. It will help deter, identify and sanction those who hide their interest in UK companies to facilitate illegal activities. Enhanced transparency will also promote good corporate behaviour
• Abolish bearer shares, to remove an easy means of facilitating illegal activity, and ensure we are compliant with international standards. This will increase transparency around who owns and controls UK companies. prohibit the use of corporate directors – one company as the director of another - with limited exceptions (to be set out in regulations). This will help counter the use of opaque arrangements involving company directors.
The Bill will introduce measures to;
• Reform Whistleblowing procedures to achieve a consistent standard of best practice for handling disclosures and provide greater reassurance to the whistle-blower that action is being taken by the prescribed person and as a result increase the confidence in the actions of the prescribed person.
• Deter business non-payment of employment tribunal awards by creating strong financial consequences of non-payment.
• Reduce the delays in Employment Tribunals caused by frequent and short notice postponements, and addressing the costs arising from short notice postponements.
• Increase the penalties imposed on employers that underpay their workers in breach of the national minimum wage legislation on a per worker basis.
• Make exclusivity clauses in zero hours contracts invalid and unenforceable so that no one is tied into a contract without any guarantee of paid work. This will enable employers and employees to benefit from the flexibility of zero hours contracts whilst addressing abuse of these contracts.
• Recover exit payments from public sector employees that leave and re-join the same part of the public sector within a year