The Enterprise Act explained: How will your business benefit?
The Enterprise Act, which aims to cut red tape for business, encourage investment in skills and make it easier for small firms to resolve payment, has now become law.
The Department for Business, Innovation & Skills said that the Enterprise Act, which received Royal Assent on Thursday, 4 May 2016, will benefit the UK’s 5.4 million businesses.
Business Secretary Sajid Javid said: “The Enterprise Act will help deliver the growth and security that benefits every single person in the country. It is proof that this government is delivering on its commitment to back the business owners who are the real heroes of our economic recovery.”
But how exactly will businesses benefit? Here we explore some of the measures included in the Act.
Small Business Commissioner to tackle late payment
Arguably the most highly anticipated measure to be introduced in the Enterprise Act is the creation of a Small Business Commissioner who will help small businesses to resolve issues with larger organisations, with a particular focus on late payment.
The key functions of the special commissioner will be to provide information and general advice, offer mediation to resolve disputes and deal with complaints.
This is likely to be welcome news to small businesses who have been feeling the impacts of late payment.
According to Bacs, small businesses are spending nearly £11 billion a year in their attempts to recover overdue payments. But now, with the help of the new commissioner, small firms will be offered mediation services in the hope that they can save time and money by avoiding using the courts to settle disputes.
Mike Cherry, FSB National Chairman, said: “This Commissioner has the potential to make a real impact on addressing bad practice across the UK economy’s payment culture. However, the role must have a clear focus on tackling supply chain bullying, and sufficient powers to intervene and resolve late payment disputes in a timely and effective way.”
Tackling red tape
As part of the Enterprise Act, the Business Impact Target will be extended to include the actions of statutory regulators. It also ensures regulators will have to carry out assessments of the economic impact any changes to their regulatory policies and practices will have on business.
It is hoped that this will provide a wider focus for the government to reduce regulatory burdens on businesses, enabling them to free up resources and boost productivity and ensure that there is even greater transparency around the impact of regulation on business.
This will enable regulators to contribute to the government’s deregulation target of £10bn of regulatory savings during the current Parliament and provide greater incentives for regulators to design and deliver policies that better meet the needs of business.
Increased access to business advice
The government has also committed to extending the successful Primary Authority scheme.
This is hoped to make it easier for businesses to access consistent, tailored and assured advice from local authorities, giving them greater confidence to invest and grow
Matthew Fell, CBI Director for Competitive Markets, said: “Expanding tailored business advice from local authorities and involving regulators more closely in the better regulation process are good signs of an ambitious plan.”
Within the Enterprise Act are a number of initiatives to protect and strengthen the apprenticeship brand in a bid to meet the government’s target of 3 million apprenticeships by 2020.
The measures include introducing targets for apprenticeships in public sector bodies and establishing an Institute for Apprenticeships – an independent, employer-led body that will make sure apprenticeships meet the needs of business.
As well as the measures mentioned above the Enterprise Act will also include the following:
- A legal obligation for insurers to pay claims to businesses within a reasonable time
- A reformed business rates appeals system
- Enhanced rights for shop workers who wish to opt out of working on Sundays
- Pave the way for bringing private capital into the Green Investment Bank
- Amended Small Business Enterprise and Employment Act relating to the Pubs Code and adjudicator
- A cap of £95,000 on exit payments in the public sector
- Allow the government to fund UK Government Investments Limited
- Updated Industrial Development Act to help support the roll-out of telecommunications and broadband
What do you think about the Enterprise Act? Will your business benefit from any of the measures introduced? Please share your views in the comments below.