According to the latest figures from Institute of Directors (IoD), SMEs in the UK are collectively spending as much as £80 billion on red tape and compliance.
The staggering statistics were revealed just as the IoD called on the government to formulate a new approach to measure exactly how much small businesses are spending on paperwork, forms, and limited company compliance.
With the general election only months away, many SMEs are now hoping for a culture change in the civil service. The department has historically been rewarded for introducing regulation on a volume basis rather than focusing on whether or not it truly adds value to the UK economy.
A spokesperson from the IoD described the amount of regulatory paperwork as “excessive” even for professional services such as solicitors, doctors and contractor accountants. According to the IoD, unless there is a fundamental change in the way civil servants are incentivised, UK SMEs will continue to struggle with excessive and often unnecessary paperwork than prevents them from growing their businesses and ultimately creating employment.
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Image: Day 110 – Drowning in Paper! by Menage a Moi
