Spiralling legal consultants’ fees hit small firms with almost £6 billion in annual compliance costs

A month before October’s common commencement date business owners are advised to rethink their own procedures and shop around for more affordable business services.  Just a month before a raft of legal changes take place, research from the Forum of Private Business shows small firms pay almost £6 billion per year to outside consultants in exchange for support on complying with regulations, more than a third of their £16.8 billion annual red tape bill.  With the latest ‘common commencement date’ for new regulations coming on 1 October 2011, more than two thirds of respondents (67%) to the Forum’s latest Referendum survey have seen consultancy costs rise since 2009, when the previous ‘cost of compliance’ research took place.   The not for profit Forum has found that small firms pay external contractors £5.8 billion for regulatory compliance services, while internal time costs total £11 billion.  On average each firm hands over £4,900 per year to companies offering legal guidance, including advice on employment, health and safety and tax, more than double the £2,100 average annual bill in 2009.  The Forum’s research shows that the combined amount paid each year by small firms to consultants and accountants for tax advice is in excess of £3.3 billion, external health and safety support costs almost £986 million per year and employment law consultancy services come to £752 million.

“Small businesses face a constant struggle to control costs, particularly in the current economic climate; but are being thwarted by the mounting tide of red tape they have to negotiate every day. With just a month to go before October’s common commencement date there is no hiding from the fact that red tape compliance costs – including steep consultancy fees – are hindering job creation and, by extension, economic growth. Unlike large companies, small firms simply do not have internal resources dedicated to complying with regulations, so either the business owner or a key senior manager is forced to devote a large amount of time to this task – an average of almost 40 hours each month – or they have to pay for an outside consultant, which can be extremely expensive. Compared to other industries, at present we are seeing a relatively robust services sector, including business services, which suggests that more struggling small firms are seeking out external support. Perhaps some companies providing commercially-driven business services are exploiting this demand by charging high fees. It is always advisable to shop around for a better deal. There are also steep legal costs incurred when businesses are charged with breaching regulations. The answer is that prevention is better than cure – it is so important put in place internal processes geared towards complying with the law in the first place.” said the Forum’s Chief Executive Phil Orford.

There is also evidence that steep employment, health and safety, tax and other consultancy fees are barriers to job creation because they increase as a business grows. In particular, taking on more staff leads to more employment law red tape – and greater compliance costs.  In all, firms with fewer than 10 employees pay an average of £4,346 per year for the services of outside consultants, those with 10 to 49 staff face average annual bills of £7,277 and firms with over 50 employees pay contractors an average of £10,815 each year.

Young Offenders Triumph in Prison Garden Competition

THE Green fingered prisoners from Young Offender Institution (YOI) Thorn Cross, in Cheshire, are celebrating having been selected by the Royal Horticultural Society (RHS) as winners of the Windlesham Trophy 2011, for best kept prison garden in England and Wales. It is only the second male young offender institution to win the award.

RHS President, Elizabeth Banks, presented the Windlesham Trophy, a redundant ‘Green Goddess’ Fire Engine bell, at an Award Ceremony held at the prison last, Wednesday, 24 August 2011. Participating prisoners were also given a certificate acknowledging their assistance.

30 young male prisoners look after the gardens at YOI Thorn Cross. This includes a large conservation area which is a haven for butterflies and numerous insects and birds, a main pond that is shared by newts and ducks and an animal shelter. They also manage bedding displays and a range of poly tunnels where a variety of fruit and vegetables are grown for internal use within the main kitchens, thus reducing the cost of buying food and products.

John Platt, Head of Learning and Skills for Thorn Cross, says:- "Winning Windlesham is a real achievement both for staff and prisoners, the gardens are a delight to walk around and have improved the life of the whole prison. The importance of wellbeingness is enhanced by the many different gardens throughout, adding to a safer and more positive environment for all in the prison. The work done over the past year by the gardens team has benefited everyone in the prison, from creating a more positive environment, better sports fields, to the homegrown produce that is used within the prison and staff kitchens, adding to healthier and more cost-effective diet."

RHS Judge, Michael Hickson, says:- "The prison garden at Thorn Cross really stood out for us this year for a number of reasons. The first impression was the bedding displays which were utterly stunning. The ‘young adults’ also manage the trees and shrubs very skilfully; pruning, thinning and shaping under guidance and there is a splendid wildflower meadow and pond, home for amphibians, butterflies, insects and mammals. They’re a great bunch of lads who regularly help local charities and schools. For example, the prison is often given old garden tools, sometimes handle-less, and as part of their training the ‘young adults’ clean them, put new handles on and make them look like new. They then donate them to local charities and schools so if you ever see a garden tool with a label saying ‘Renovated by Thorn Cross’ you will know where it has come from!"

At the ceremony, Elizabeth Banks also met up with Yvette Blake, Head Mistress of The Cobbs Infant and Nursery School, which works in partnership with Thorn Cross.

Horticulture forms an important part of the resettlement agenda at Thorn Cross, giving prisoners the opportunity to obtain industry-recognised qualifications (National Proficiency Tests Council) not only in gardening skills, but also in the use and care of horticultural machinery.