HC Deb 17 April 1978 vol 948 cc26-8
48. Mr. Ridsdale

asked the Chancellor of the Duchy of Lancaster how many forms for small businesses will have been eliminated in the last six months.

The Chancellor of the Duchy of Lancaster (Mr. Harold Lever)

Hundreds of thousands of small firms will benefit from the simplification of VAT returns announced last week. The information required on the present form will be reduced by about 50 per cent. To give another example, the Business Statistics Office has this year reduced the number of forms sent to small businesses by raising thresholds from 25 employees to 50,100 or even 200.

These are two examples of what we can do to reduce or eliminate the burden of paperwork on small businesses, and we are working carefully and systematically to do more along these lines.

Mr. Ridsdale

Is the right hon. Gentleman aware that we always welcome the sinner who repenteth? Now that he has achieved a certain amount in this direction, will he look particularly at the Employment Protection Act 1975, which is still a barrier to expansion for the smaller businesses, which he must know well from some of the statements made to him?

Mr. Lever

I shall certainly look at that, because I recognise that every social advance made in our country involves a certain degree of friction. But the common sense and fairmindedness on which we pride ourselves normally teach us all to adjust to these advances, and in the end to welcome them.

As for repentant sinners, I am very glad to hear from the Conservatives such an inviting prospect as that phrase conjures up.

Mr. McNamara

Is my right hon. Friend aware that the majority of small businesses in my constituency and in my area welcome the changes which have been made, and that employees in small businesses are entitled to exactly the same protection as exists in larger businesses? Does he agree that the more that can be done in industry generally to get away from red tape while preserving social justice, the more welcome it will be, but that social justice cannot be achieved at the expense of the employee?

Mr. Lever

I am grateful to my hon. Friend for his encouraging remarks. I am quite sure that it would not be in the interests of small businesses—and I have their interests very much at heart—if I were to encourage them to expect to enforce lower levels of obligation to their employees, whether in safety matters, health or other moral obligations, than elsewhere. It would not be in their interests, and I do not propose to do so.

I am very grateful to my hon. Friend for welcoming the energetic steps that the Government are taking in all Departments to reduce the amount of form filling and time wasted in unnecessary administrative work.

Mr. Marten

As one of the form-filling tasks which have been lifted from the business man is VAT because the exemption limit has been raised, will the Minister confirm that that limit cannot be raised any more, much as we should like it, because of the Sixth Directive of the EEC, by which we are bound?

Mr. Lever

The limit certainly cannot be raised beyond a certain point because of our obligations to the Community. On the other hand, I hope that we shall continue zealously to examine the amount of work involved in VAT. I do not want to score any second-rate party point, but the Conservative Government brought in the VAT compendium of questions, and we have cut it in half overnight.

Mr. Heffer

I welcome the rise in the threshold for VAT, but is my right hon. Friend aware that many of us would be very concerned at the idea of a multi-rate band for VAT, as exists in the Common Market countries? Will he give us an assurance that that will not happen? Does he agree with me that if there were an increase in VAT, as proposed by the Liberals, it would not help small businesses but would have a very bad effect on them?

Mr. Lever

I am grateful to my hon. Friend, who always seeks to enlarge the area of decisive jurisdiction within which I work. However, the questions that he has asked would be better directed to the Chancellor of the Exchequer. But I am ready at once, without close examination, to admit that the ideas of any party, Liberal or other, are inferior to the ideas that emanate from the Government side.