MOVES to cut regulation stifling small businesses “are not worth the paper they are written on”, according to the Government’s own advisers.

In comments that undermine official policy, the Small Business Council has demanded an overhaul of rules aimed at forcing civil servants to consider the impact of new laws on businesses. It said the rules, in the form of regulatory impact assessments (RIAs), often failed to consider the cost to smaller enterprises, rendering new laws counterproductive.

William Sargent, chairman of the Small Business Council, says in a study: “Government needs to be aware of the unintended consequences of legislation . . . as a result of increases in maternity leave and payments, for example, we believe that employers may now be less likely to take on women of childbearing age.”

He added: “We are not convinced that policymakers make much attempt to quantify accurately the costs of regulations on small firms.”

Policymakers, the study says, should be forced every year to highlight laws that could be abandoned and should be encouraged to regard legislation as a last resort.

The report is an embarrassment to the Government, which has been seeking to improve relations with business with promises to cut regulation. Tony Blair endorsed RIAs in 1998 in his “bonfire” of red tape.

Business groups said that the study confirmed their concerns about the failure of the impact statements.

A spokesman for the Federation of Small Businesses, said: “This is the single main method the Prime Minister promised would cut red tape and it is not working. It is an issue for serious concern.”