SMALL firms in the North West have come out strongly against Government plans to extend family-friendly work policies which could potentially cost UK businesses at least £130 annually.

A new survey from Yell has disclosed that more than a third of small firms believe that giving working fathers the statutory right to two weeks' paid paternity leave from April 2003 will damage their business.

They say it will place an extra financial burden on them, both in the planning and management of cover and the administrative cost of compliance.

And nearly half believe the decision to extend maternity leave from 18 to 26 weeks will have a similar damaging effect.

Government figures estimate that the cost to business in covering paternity leave will be at least £42 million a year.

Furthermore, extended maternity leave could cost firms £10 million a year in additional statutory maternity pay and £10 million in one-off cost to employers in changing payroll arrangements.

One third of North West companies also believe an increase in the statutory maternity and maternity allowance from £60.20 to an eventual £100 a week will have a negative effect on their business.