Business Secretary Sajid Javid will unveil plans to back small businesses by cutting red tape for “Britain’s engine room” in the new Enterprise Bill today.

The cabinet minister will speak in Bristol, the city where he grew up above his parents’ shop, about the Conservative’s plans to create the Small Business Conciliation Service to help settle disputes between large and small businesses, especially over late payment practices.  According to the Conservatives, small businesses are owed more than £32bn in late payments but many are not aware of their rights or are reluctant to launch legal challenges.

The bill also aims to support small businesses by simplifying the mixed messages given by local councils. The scheme will result in businesses getting advice on regulation from a single local council and this advice must then be respected by all other councils. It is hoped this will reduce the time and cost to businesses.

“Small businesses are Britain’s engine room and the success of our whole economy is built on the hard work and determination of the people who run and work for them,” Javid said. “As part of our long-term economic plan, we will sweep away the burdensome red tape and get heavy-handed regulators off firms’ backs.”

Javid is expected to reveal proposals to cut red tape in Europe by proposing lighter regimes for small businesses in new EU legislation. His plans, including a £10bn target in red tape reduction, will be included in the Queen’s speech next week.

John Allan, national Federation of Small Businesses chairman, said he is pleased that the Government is keeping its commitment of giving small businesses full backing, but warned that the minister had not undertaken a simple task. “These are not easy issues to tackle and we will need the minister to work closely with our members and the wider business community to find solutions,” he said. “We look forward to working with the Business Secretary and his team over the coming months.”