The potential impacts on small and medium sized businesses of any new Government policy measures will have to be considered before they are signed off under plans approved by Cabinet today.
The enhanced SME Test will have to be rigorously applied by all Government departments to major new measures that will directly or indirectly impact SMEs, the Minister for Enterprise, Peter Burke said.
"The revised SME Test will help to ensure the 'think small first' principle is thoroughly applied to new measures as they are being developed," he said.
"This will ensure that potential impacts on SMEs are fully considered, and mitigations are applied where appropriate."
"Under the new guidelines, all primary and secondary legislative proposals, new policies and strategies, and all SIs (Statutory Instruments) will need to carry out an SME Test or provide an explanation why one is not necessary."
The move is part of a response by the Government to severe criticism levelled at it from the business community over the implementation in recent months and years of a raft of costly new policy measures.
These include increases in the minimum wage, changes to sick pay entitlements, the start of pension autoenrolment next year and more.
Many of the measures arrived as SMEs were already grappling with rising input costs, such as for raw materials, insurance, etc as a result of soaring inflation.
Small business organisations had asked the Government to implement a more rigorous policy testing scheme to ensure there is no repeat in the future of this situation.
The test will identify disproportionate impacts on SMEs and encourages policymakers to propose alternative policy options or mitigating measures to minimise the impact.
The Government also recently agreed to consult with business to identify additional areas across departments and agencies where the regulatory burden could be reduced.
