Business given power to scrutinise regulators’ performance
Business Minister Michael Fallon announces a new initiative that puts the reform of regulatory enforcement in the hands of business.
Business Minister Michael Fallon today (17 December 2013) announced a new initiative that puts the reform of regulatory enforcement in the hands of business.
If a sector is frustrated by unnecessary burdens, inconsistent advice from regulators, unhelpful guidance or poor engagement with business, they will have a new opportunity to raise these concerns and present their case for change directly to the regulators and Ministers concerned.
The current Focus on Enforcement initiative has successfully challenged poor implementation and enforcement of regulation - but is entirely run by civil servants. Business Focus on Enforcement will instead give trade associations and representative business groups a key role in identifying issues and driving reform.
Terry Scuoler, Chief Executive of EEF, the manufacturers’ organisation will act as an advocate for this pilot programme, encouraging trade bodies and business groups to apply to run reviews into how regulation is enforced in key sectors.
They will be able to bid through a competitive process to run a review from early 2014. From today (17 December 2013), any company or business group who wishes to suggest an area of enforcement activity for review can make suggestions at Focus on Enforcement.
Business Minister Michael Fallon said:
We are re-shaping the way regulators work with business, so that upholding standards does not act as an unnecessary barrier to growth. Rather than relying solely on government to achieve this, we are putting the private sector in the driving seat. Harnessing trade bodies’ knowledge, networks and first-hand experience will allow us to get straight to the issues and deliver the right results for business.
Terry Scuoler’s role will be invaluable in encouraging industry bodies to help put enterprise at the heart of enforcement.
Terry Scuoler said:
All good businesses understand the added value of well-thought out regulation, and experience the frustrations of poorly created or badly implemented regulation.
Today’s announcement is another step forward, towards lighter-touch and better targeted enforcement by regulators.
Giving businesses a greater role in reviewing regulation is a significant change for the better. I’ll be encouraging business groups from all sectors to seize the opportunity to eliminate the bureaucracy, duplication and lack of clarity that still impedes growth.
More than 50 non-economic regulators - with a combined budget of just under £2 billion and 25,000 employees undertaking regulatory duties - as well as local authorities carry out regulatory functions that impact on business. This is an opportunity for business to ensure such organisations help rather than hinder those they regulate, imposing minimum burdens that could hold firms back, while upholding high standards of public protection.
Trade associations that have already benefited from the first phase of Focus on Enforcement have expressed strong support for this new ownership model.
Peter Newport, Chief Executive of the Chemicals Business Association (CBA) said:
CBA has found the initial Focus on Enforcement programme to be very successful as it has already realised solutions to a number of issues and is leading to an enlightened enforcement regime for our sector. We look forward to the next evolution in ownership of the on-going program.
Peter Baker of the Health and Safety Executive and Neil Davies of the Environment Agency said:
The Focus on Enforcement review of the chemicals sector provided the Competent Authority with valuable insights into business experience of the regulatory regime, how it is operating in practice, and where it may be affecting growth. The review has helped us to refine and target our business improvement programmes, and we are working closely with business to make changes that will deliver a more open, effective and efficient regulatory regime.
Michael Fallon also highlighted today (17 December 2013) that the government will consult in early 2014 on proposals to introduce a new independent Small Business Appeals Champion into each non-economic regulator.
These Champions will prompt reforms to ineffective complaints and appeals mechanisms. This will benefit all business, but will be of particular value to small firms, who can find complex, inaccessible or expensive regulator appeals processes a particular challenge.
The current Focus on Enforcement programme has reviewed 10 different areas of regulatory enforcement and delivered numerous reforms welcomed by business and regulators alike. For example, the launch of a Coastal Concordat last month (November 2013) has transformed the highly complex regulatory landscape at the coast into a system far easier and quicker for business to use.
Government action on red tape – including through the Red Tape Challenge and tough Whitehall rules that demand all new regulation is offset by ambitious cuts in costs to business - is already saving business over £1 billion. Michael Fallon has pledged to build on this success by re-doubling government efforts to reduce the burdens placed on business by unnecessary bureaucracy, including from Europe.
Notes to Editors:
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If a Trade Association or representative business group would like more information or to talk in more detail about the pilot initiative and a potential future bid, they can contact the Focus on Enforcement team at [email protected].
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Focus on Enforcement reviews examine how regulation is delivered – whether through inspections, advice, or enforcement – not the regulations themselves.
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This year the government replaced the One-in, One-out rule with the more challenging One-In, Two-Out rule - under which departments must find savings worth double the cost of any new regulations on business.
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The government is working with partners across Europe to reduce the burden of EU regulation on business. Priorities for making the EU more business-friendly include persuading the Commission to publish an annual statement of the net cost of EU legislation, to help business see what burden of regulation stems from the EU; and making sure that business have an opportunity to influence EU proposals at an earlier stage. The government is backing 30 recommendations for reform drawn up by a taskforce comprising 6 heavy-hitters from the UK business community appointed by the Prime Minister. See the press release ‘Government welcomes business-led plan to cut EU red tape’.
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The government’s economic policy objective is to achieve ‘strong, sustainable and balanced growth that is more evenly shared across the country and between industries’. It set 4 ambitions in the ‘Plan for Growth’, published at Budget 2011:
- to create the most competitive tax system in the G20
- to make the UK the best place in Europe to start, finance and grow a business
- to encourage investment and exports as a route to a more balanced economy
- to create a more educated workforce that is the most flexible in Europe
Work is underway across government to achieve these ambitions, including progress on more than 250 measures as part of the Growth Review. Developing an Industrial Strategy gives new impetus to this work by providing businesses, investors and the public with more clarity about the long-term direction in which the government wants the economy to travel.