Entrepreneurs have been urged to report legislation they feel is excessive by the minister for business.
Mark Prisk, who established a successful consultancy during the early 90s recession, told the Telegraph that the Department for Business, Innovation and Skills wanted to start scaling back bureaucracy as soon as possible. "We need to provide some early examples,” he said. “I want to make Whitehall benign as far as business is concerned.”
A “one in, one out” rule was set out in the coalition agreement published two weeks ago, whereby no new regulations will be introduced without others being cut "by a greater amount".
Prisk, the Conservative MP for Hertford and Stortford, said: "As someone who ran a business I like to get on and make decisions. It is true that I haven't been in business for nine years in that sense, so I am aware that I did leave the real world as far as most businesses are concerned a little while back and I want to keep close contact with business.”
I think it is that practical experience that will hopefully give me a chance to understand the problem when I am dealing with it here in Whitehall
Mark Prisk, minister for business
Prisk implied that being a former business owner gives him a keener understanding of what businesses need.
Cumulative burden
"What matters is that if you have started a business and you have run a small business you understand the practicalities,” he explains. “Why, for example, cash flow is often more important than profit or why regulation is not the single measure but the cumulative burden.
“I think it is that practical experience that will hopefully give me a chance to understand the problem when I am dealing with it here in Whitehall.”
Prisk also promised “in the next few months” to “strip away the regional Business Link” advisory network, and in its place establish a “modernised” system of electronic and face-to-face support that targets two groups – “conventional businesses” and “high-growth businesses”.
In the coalition agreement, the government promised to take "urgent action" to boost enterprise and, more prosaically, "a new and more responsible economic model".
The coalition is also giving employees the right to request flexible working and introducing rules on equal pay.
With the Treasury examining the desirability of imposing net lending targets or introducing a loan guarantee scheme, Prisk says that bank lending has fallen as much because of a drop-off in demand as well as any constriction in supply.
“I think it’s important that we are not complacent in this area. Small business have been trying to reduce their debts, perfectly sensible in this environment.
“So the amount of bank lending has fallen as demand has fallen away,” he said. “But we still see sustained anecdotal evidence that there are problems for small and micro businesses.”
In the short term, says Prisk, a refined version of the existing Enterprise Finance Guarantee scheme is most likely. Under the scheme businesses with few assets can get a government guarantee on 75% of a bank loan in return for a 2% interest rate premium charge. If demand for credit exceeds supply, which amounts to £500m worth of guarantees under present arrangements, a “national loan guarantee” is planned.
“In the next couple of weeks we will set out a sensible package where loan guarantees are more available and the system will be more predictable,” said Prisk.
“What George Osborne has made very clear is that we are going to have a generous package for entrepreneurs. It is as close to his heart as it is to mine. I am very confident as someone who worked in this role in Opposition and worked very closely with my Treasury colleagues that we have a shared agenda.”
Prisk added: “This Government has to do two central things: to get the budget deficit under control and help the private sector to grow. This department is the ‘Department of Growth’. That means stripping away the burdens and constraints on business, giving them a long term framework so that people say ‘Ok, Britain is open for business.”
Since 2002 Mark Prisk, 47, has been shadow Financial Secretary to the Treasury, Paymaster General and Home Affairs Whip. He was given a business and enterprise portfolio by David Cameron in 2005.
