Chancellor Rachel Reeves is preparing to unveil a major “blitz on business bureaucracy” that the Treasury claims will save companies up to £6bn a year, as Labour seeks to reassure businesses ahead of a potentially tax-raising Budget next month.
Addressing more than 350 executives, regional mayors and global investors at the government’s first regional investment summit in Birmingham, Reeves will announce plans to cut “pointless admin” and remove regulatory burdens on SMEs as part of a wider productivity agenda.
One of the flagship measures includes scrapping the requirement for directors of small businesses to file directors’ reports with Companies House — a change expected to benefit more than 100,000 firms including microbreweries, independent retailers and hospitality operators.
The move is part of a wider effort by Labour to signal it is “actively listening” to business concerns as boardrooms brace for potential tax rises targeting wealth and corporate profits in the 26 November Budget.
Last week, Reeves told The Guardian recently that any new tax measures would fall on those with the “broadest shoulders”. With the Office for Budget Responsibility (OBR) reportedly poised to downgrade productivity forecasts and factor in rising borrowing costs, the Chancellor is expected to pair tax hikes with public spending restraint to meet Labour’s fiscal rules.
Amid mounting concern over economic stagnation, the Treasury is pitching its deregulation drive as a productivity enabler that will improve efficiency and free up time for investment and growth.
“Cutting administrative burdens allows small businesses to spend less time on paperwork and more time growing, hiring and innovating,” a Treasury spokesperson said.
The Edgbaston event will also be used to showcase private sector investment, with ministers set to announce up to £10bn in fresh commitments — though the majority comes from a previously confirmed £6.5bn pledge by US-based real estate group Welltower to expand care home capacity in the UK following its acquisition of Care UK.
Organizations expected to attend include AustralianSuper, HSBC and private equity firm KKR, with Labour positioning the summit as evidence of investor confidence under its leadership.
Reeves will tell delegates: “Our mission is clear: to create the right environment for investment through regulatory reform, crowd in capital through public institutions, and support innovation and growth throughout the UK.”
The Treasury also confirmed that Labour will inject “millions more” into regional growth initiatives to support levelling-up style projects and attract further private capital.
While business groups are likely to welcome moves to simplify reporting obligations, there is growing anxiety that Labour’s fiscal squeeze will ultimately drive up employer costs.
With concerns over competitiveness, taxation and regulatory certainty at the forefront, Reeves’s ability to balance “pro-enterprise” messaging with fiscal tightening will be tested in the coming weeks.
Speaking about the announcement, Scott Gallacher, Director at Leicester-based Rowley Turton, said there are many “outdated” regulations.
He continued: “Slashing red tape and delivering efficiency savings is the standard promise of every political party, regardless of colour – but it’s rarely delivered. Much of what’s called ‘red tape’ actually exists for public safety, and I suspect ministers often find the Sir Humphreys of Whitehall blocking reforms on what could be unnecessary red tape for fear of future scandals that those same rules were designed to prevent.
“One area that genuinely could be reviewed, yet is always missed, is the outdated regulations. These were introduced in the 1990s over concerns that office workers staring at computer monitors for long periods might damage their eyesight – a fear that was, as far as I know, completely unfounded.
“Today, virtually everyone uses screens – laptops, tablets, or phones – throughout their day, both at work and at home. The idea of paid eye tests for any employees who look at screens as part of their work is now entirely redundant and yet another unnecessary burden on business.”
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Reeves to announce £6bn ‘blitz on business bureaucracy’ ahead of tax-heavy Budget