The Government has responded to fears that new legislation could cost firms in Sussex up to £226 million by pledging to change the regulatory culture of Whitehall.

Sussex Enterprise, the county’s chamber of commerce, said the costs would be caused by new laws which are in the pipeline between now and 2014. The chamber s warning comes in the wake of new legislation including The Equality Act 2010 and increases to the national minimum wage.

Mark Froud, chief executive of Sussex Enterprise, said: “If private sector businesses are to replace job losses in the public sector, the significant costs of employing people must be reduced. The Government has the chance to prove its commitment to reducing the substantial burden of regulation by putting the brakes on any costly employment law coming into force during the life of this Parliament.”

Responding to these claims, a Department for Business spokesman said: “The Government is absolutely committed to cutting the red tape which is taking time and money out of British businesses on a daily basis. That is why we have taken decisive measures early on to reduce the regulatory burden and change the culture of Whitehall so regulation is seen as the last resort. We have introduced a groundbreaking new one-in, one-out policy which means that for every new business regulation a department wants to introduce, it will have to find one of equal cost to remove. We have also launched a review of all regulations that are still in the pipeline to be introduced to make sure they are still absolutely necessary. The aim of reducing regulation agenda is to cut the cost of regulation to business. Businesses had already made preparations for a number of measures to come and, as a result, not introducing these measures would have had a great deal of uncertainty and further costs to business.”

Trevor Constable, chairman of the Worthing and Adur Branch of the Federation of Small Businesses ( FSB) , said: “Regulation and keeping up to date with the introduction of new laws has long been stifling business growth, and the FSB welcomes the Government s proposals to put an end to the excessive legislation that is choking small businesses. Small firms have long been saying that the burden of regulation and the time it takes to comply is just too much and could prevent them from taking on staff, which could stunt economic growth. The FSB has been calling for the regulation system to be simplified as a route to economic growth for some time, so these proposals will be welcome news to those small firms looking to grow and develop.”

Jeremy Taylor, chief executive of the Gatwick Diamond Business Association, said: “While some new legislation is necessary to protect employers, employees and consumers, we welcome the one-in, one-out policy. Obviously we do not wish to see legislation which makes life difficult for businesses. Any new legislation should not have an infinite shelf life but should come with a sell-by date.”