Government hopes that the proposals to cut red tape will engender significant cost savings for entrepreneurs and renew consumer trust in business.

The proposals contained in the document are being billed as the most fundamental review of company law in 150 years.

'This will produce savings of nearly £170million for small companies,' said Johnson. 'This is about intelligent regulation that promotes enterprise and responsible business.' The document from the department of trade and industry includes plans to simplify the law, improve transparency, and improve governance to encourage responsible business. It also sets out directors' duties in statute, prohibits corporate directors, and relieves private companies of the obligation to appoint company secretaries and hold agms unless members want them. It also proposes that accounts be filed more quickly by up to two months.

'The white paper is a blueprint for a new era in British corporate history,' said Johnson. It contains more than 200 draft clauses and marks the start of a consultation process that will run until November 29. Copies of the paper and a summary for small business are available at www.dti.gov.uk/companiesbill.