Posted by

Kamala Mackinnon, Campaigns Adviser

13 Jul 2012

The BCC undertook an extensive study into the progress made by the government to improve the regulatory architecture through which new regulatory proposals pass and thus reduce the burden of red tape placed on companies. This report tests the robustness of the government’s regulatory architecture, for if the basic processes through which proposed regulations are developed are imperfect, the overall regulatory framework will be flawed. This creates needless red tape which significantly affects firms’ ability to grow and create employment.

Our research shows that the regulatory process is still not transparent, that the quality of regulations needs to be improved and that some government departments are not taking the taking the deregulatory process seriously. The BCC also examined the quality and public availability of IAs and the number deemed ‘not in scope’ of the One-in, One-out policy (OIOO). OIOO means that no new primary or secondary UK legislation which imposes costs on business or voluntary organisations can be implemented without the identification of existing regulations with an equivalent value that can be removed. Our report shows that 50% of new regulations were deemed ‘out of scope’ of the OIOO system. This needs to be reviewed so that the rule applies to all relevant regulations, otherwise it makes a mockery of the whole system. Our report also shows that there is no co-ordinated approach to the regulatory process across government departments and that there needs to be a culture change across the government.  

We need a regulatory architecture that reduces the size, complexity and constant change in the rule book for business. Firms need lower compliance burdens, with fewer costly and resource-intensive processes and co-operative, not punitive, enforcement of the rules – to deliver a better local business environment for all.

The government has made some creditable progress on the deregulatory agenda - particuarly the Better Regulation Executive which is working hard to reduce unnecessary red tape. However, the regulatory system must be more transparent and RPC recommendations must be implemented by departments. Furthermore, the scope of OIOO must be reviewed. These changes would significantly strengthen the regulatory architecture and thus lessen the needless red tape faced by businesses on the ground.