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Resellers need to be freed from red tape to drive recovery

Simon Quicke

One leading SME business group has called for resellers to be freed from red tape if they are going to be able to help the economy grow.

In light of the cautious growth in the economy shown by the 0.5% rise in GDP for the first quarter of this year the Forum of Private Business (FPB) has urged the government to take action.

The business lobby group believes that SMEs would be able to do more to help the economy if they were liberated from stifling restrictions both in the form of legislation and tax.

"An increase of 0.5% is as good as we might have hoped for and it's reassuring to know we haven't returned to recession. However, it doesn't indicate any great surge of economic activity," said FPB chief executive Phil Orford.

"If smaller companies are to foster a genuine and meaningful recovery, they need to be freed from costly and time-consuming red tape, benefit from a simpler and more sympathetic tax system, and see the soaring costs of essentials like fuel and utilities tackled," he added.

All eyes had been on the GDP figures because of the fear that the VAT increase in January and the public sector cost cutting that had started to filter through had derailed the fragile economy.

The Independent Office for Budget Responsibility had originally forecast 0.8% for Q1 but figures out this morning from the Office for National Statistics (ONS) showed the recovery had not been quite that strong.

It does however seem to rule out the dreaded double-dip and the ONS analysis indicated the blips caused by the snow late last year had now been overcome.

"The effect of the abnormal weather conditions in December 2010 is estimated to have subtracted 0.5 per cent from growth in the fourth quarter. GDP is estimated now to have returned to the level in the third quarter of 2010," stated the ONS.

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