New research carried out by the Forum of Private Business (FPB) has found that small and medium-sized companies face an annual bill of £2,072 million in time and money spent on health and safety guidelines.

The not-for-profit business support and lobby group calculated the figure using feedback from its members as part of its quarterly Referendum survey. The FPB found that the cost of complying with health and safety legislation was the second-largest out of seven different types of regulation business owners must contend with.

The FPB, which produces a guide to help owners of smaller businesses make sense of health and safety regulations, found the cost was eclipsed only by that of legislation associated with employing people. It was significantly more than that incurred by small businesses dealing with tax laws, which was calculated to cost £1,826 million.

In comparison, the cost to smaller businesses of complying with environment and waste legislation was put at just £783 million, while paperwork surrounding equality and diversity rules cost the least, at £367 million.

The FPB's Referendum survey found that the cost of complying with health and safety guidance was highest for smaller businesses in the services sector (as defined by the UK SIC), which are left around £832 million out of pocket every year. The TRAD sector, encompassing businesses related to retail, hospitality, transport, storage and vehicle services was the next hardest-hit, with costs of £606 million, while smaller businesses in the manufacturing industry faced annual costs of around £357 million.

Smaller firms in the construction industry faced the smallest bill out of the four, spending around £277 million each year on compliance.

By region, the cost of complying with health and safety regulations was found to be the highest in the South East, where firms spend around £309 million each year on it. London faces the second-highest bill, at £273 million, followed by the North West at £234 million.

FPB member Rachel Andrews, the Financial Director of Hertfordshire-based Andrews Computer Services Limited, attended a meeting of the Government's Better Regulation Executive (BRE) on 26 June 2009 to put across small business owners' calls for less regulation.

Mrs Andrews said the time and money spent on health and safety paperwork was a major bone of contention with owners of small businesses. She said she believed much of the time-consuming legislation could be scrapped and replaced with a "common sense" approach to safety at work – and a greater degree of trust in business owners to look after their workers.

Mrs Andrews said: "I just feel that a lot of these rules are a little bit silly.

"Of course, nobody wants to harm their employees, but we are trying to make a living and, in the current economic climate, that's not always easy, especially when you're having to devote valuable time to all this form-filling.

"There should also be gradients of what you're expected to do, depending on the size of your business."

Despite her business only employing 10 people, Mrs Andrews said health and safety legislation forced her to take special measures, including appointing and training two designated fire marshals and making sure employees all completed 14-point tickbox questionnaires on using monitors.

However, Mrs Andrews said the FPB's own Health & Safety Guide helped her to make sense of the rules. The publication is designed to be as simple and easy to follow as possible, in order to save owners of smaller businesses time and money when complying with regulations.

It is written in a 'comply-as-you-complete' format and comes with a selection of customisable templates, including fire and risk assessment forms, and lists contact details for key health and safety-related organisations.

The FPB has also joined forces with specialist firm Cardinus to provide smaller business employers with online training and distance learning on health and safety issues in a move designed to help them comply with the rules while controlling costs.

Andy Hawkes, the CEO of Cardinus, commented: "While the focus has always been on larger clients, we have increasingly been asked to deliver solutions to smaller firms, particularly by insurance brokers and insurers.

"To meet this demand, we have built a web-based proposition, www.sme.cardinus.com, that provides owners and managers of small and medium-sized businesses with self-help advice and easy-to-use risk assessment tools."

The FPB also provides its members with specialist advice through its member helpline and a 24-hour legal helpline through a legal expenses policy available to members. The helpline is confidential and manned by lawyers and other professional advisers.