RED tape is a bigger concern to local firms than the fortunes of the economy, according to a survey out today.

Bosses of small firms in the region said that rules and regulations were a major threat to entrepreneurial success.

And despite the impact of the economic slowdown almost half the firms questioned said they were planning to expand their businesses over the next 12 months with a third expecting to take on new staff.

Surprisingly, the Government's introduction of late payment legislation is not expected to have a major impact on firms. And only 12 per cent said they were worried about the effects of the minimum wage.

"With economic commentators cautiously predicting a soft landing rather than a full blown recession small firms are seeing the light at the end of the tunnel and as a result are putting in place expansion plans," said Conrad Broadbent, regional manager for the North West at Royal Bank Invoice Finance which commissioned the report.

"It is encouraging that firms are looking to the future and are considering taking on more staff.

"However, more must be done to encourage the enterprise culture both by the Government and those organisations committed to representing the interests of small firms."

Converted for the new archive on 14 July 2000. Some images and formatting may have been lost in the conversion.