Letter: UK regulatory control

UK regulatory control: still business friendly despite burden of red tape

Linda Wain’s feature (All snowed under, 14 July) presented an overly negative view of regulation in this country.

Surveys conducted by the OECD have shown that the UK has the most lightly regulated product market and one of the most lightly regulated labour markets in the developed world.

The Economist Intelligence Unit ranked the UK second among the 60 largest economies in the world for providing the most attractive location for businesses over the next five years. And Lord Haskins’ Better Regulation Task Force found that, contrary to expectations, regulation did not damage the competitiveness of the British hotels and restaurants industry compared with its European counterparts.

Some regulation will always be necessary to ensure that people are paid decent wages and are entitled to reasonable time off, for example, and to protect consumers, public health and the environment. It can also help provide a well educated workforce.

We make no apology for introducing regulations designed to ensure a fair, healthy and secure society. However, we are also committed to promoting productivity and competitiveness and are working hard to minimise the regulatory burden on businesses.

Often we find that businesses do not complain about the regulations themselves but about the costs and time taken up by form filling and record keeping. In this context we have taken issue with the figures published by the British Chambers of Commerce. It is important to separate out the cost of the regulation itself from the cost of administration and, on this basis, the costs to business are a fraction of that suggested by the BCC.

The BCC failed to acknowledge, for instance, that the Department of Trade and Industry responded to concerns raised by business organisations over the national minimum wage and that the revised arrangements result in negligible costs for administration. The costs for student loan collection are much closer to £70m than the BCC figure of £359m.

While we are by no means complacent about the regulatory burdens placed on business, especially small businesses, progress is being made. With the constructive support of the Better Regulation Task Force, and the additional input from the Small Business Service, our aim is to make sure that only regulations which are truly necessary reach the statute book and that they are as simple and easy to understand as possible. The proposed Regulatory Reform Bill will also enable us to do away more easily with outdated, burdensome and overlapping regulation.

Mo Mowlam, Minister for the Cabinet Office

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