Simon Boyd, managing director of Christchurch-based REIDsteel, has urged the government to rethink its approach to regulation, warning that excessive red tape is harming the ability of small and medium-sized enterprises (SMEs) to thrive.

In a letter to Secretary of State for Business and Trade Jonathan Reynolds, Simon called for smarter regulation that would support, rather than stifle, the growth of smaller businesses.

The letter, copied to various political parties, highlighted how unnecessary regulations were impacting SMEs’ capacity to grow, increase tax contributions, and drive social mobility.

Simon, also a trustee of the Jobs Foundation and a non-executive director at Dorset Chamber, said that while large businesses and public sector organisations could more easily absorb the cost of new regulations, the same was not true for SMEs.

He commented: “If our government is serious about growth, it needs to stimulate the business economy. A one-size-fits-all approach does not work and acts as a straitjacket on SMEs, damaging their ability to grow and develop.”

The government’s recent Employment Rights Bill, announced in the King’s Speech, was singled out by Simon as a cause for concern.

He believes that the proposed regulations, which include flexible working by default and a potential move towards a four-day week, will disproportionately impact SMEs.

Simon added: “Government should be eradicating regulations that are not fit for purpose and damage business.”

SMEs, which account for 99 per cent of UK businesses, make up 61 per cent of private sector employment and half of all business turnover, according to figures from the House of Commons Library.

Simon stressed that these businesses, rather than large corporations, were the real drivers of social mobility and prosperity in the UK: “It is not government that lifts people out of poverty, but business.”

Simon is pushing for a meeting with Mr Reynolds to discuss better regulation and more accessible finance for SMEs, pointing out that successive governments have prioritised the financial sector and larger corporations.

He previously called for increased financial support during a manifesto launch by the British Constructional Steelwork Association (BCSA).

The CBI/Pertemps Employment Trends Survey supports his concerns, with 62 per cent of respondents predicting that the UK will become a less attractive place to do business if current employment law reforms go ahead.