The Coalition Government set out its stall on business regulation today: Business Secretary Vince Cable 'announced a comprehensive package of measures' (which, to be honest, is stretching it a bit) designed to slash red tape and bureaucracy. Now you won't find many business owners who are opposed to the idea of reducing red tape. But we've heard all this a million times before: the big question is whether the Government can succeed (where others have failed) in curbing Whitehall's love of making up new rules?
The headline measure is the (much-trailed) One-in, One-Out policy - which will supposedly mean that no new regulations can be introduced without one of an equivalent cost being removed. So at the very least, this should mean an end to the explosion of new rules that we saw under the last Government. There's also the Your Freedom website where people can suggest laws they want scrapping (though we'd like to see what happens if everyone says 'scrap corporation tax') - as part of its drive to 'transform the relationship between people and government'.
But its biggest challenge will be changing the culture in Westminster. And there will be various new curbs on policy-makers, including new over-arching Principles of Regulation that ministers will have to consider when drafting new laws. An independent Regulatory Policy Committee will also scrutinise each proposal, while BIS's Better Regulation Executive will work across the piece to implement new rules and weed out unnecessary ones.
All of which is playing to the gallery, particularly as far as small firms are concerned. A Forum for Private Business survey last year found that 81% of SMEs felt the existing framework was 'unrealistic and unfair' - and that understanding and implementing all New Labour's new rules was costing firms a whopping £9.3bn a year. That’s a lot of wasted profit.
However, politicians are constantly promising to cut red tape (as Labour was, in fact) and in practice very little usually changes. This is partly because removing regulations is a damned sight trickier in practice than it is in theory. For instance, how likely is the Government to repeal employment legislation, most of which we’re compelled to follow by EU law? And besides, red tape isn’t bad per se – we’re hardly going to scrap anti-discrimination rules, or measures protecting workers’ health.
On the other hand, it’s definitely true that a command-and-control culture has been emanating from Whitehall in recent years; more regulation seemed to be the answer to everything. Let’s hope that at the very least, all these changes can shift attitudes a bit.
In today's bulletin:
RBS back in the black - by the skin of its teeth
Cadbury boosts Kraft - but is the reverse true?
GM raises the stakes with 'lifetime warranty' on new cars
Editor's blog: The difficulties of mega-philanthropy
One-in, One-out: Government promises no more red tape