Business group attacks government's claims of red tape cutting
Posted by Dan Martin in Finances, Regulation on Wed, 28/09/2011 - 14:24
The British Chambers of Commerce (BCC) has challenged the government's claim that it has made progress in cutting the burden of business regulations.
Releasing what it terms a "Statement of New Regulation", the Department for Business, Innovation and Skills (BIS) said the cost of regulations has been capped during 2011, with a gross reduction of over £3bn.
Mark Prisk, business and enterprise minister, said: "During 2011 we have made real progress in cutting the costs of red tape for businesses. As well as the £3bn saving for employers from the new indexation of pensions, we have seen a capping of other regulatory costs, and a substantial rise in the numbers of deregulatory measures.
"This is an encouraging sign that the culture in Whitehall is beginning to change. People are beginning to realise that regulation must be the last resort, not the first option. There is much more to do - especially so that businesses really notice the difference - but this first year is very promising."
But the BCC claimed £45m in costs were imposed on businesses during the first six months of 2011, with the controversial Agency Workers Directive, which comes into force on 1 October, due to add another £1.5bn a year.
"No government, anywhere, should impose £45m in new costs on businesses in the midst of a bumpy recovery and uncertain global economic climate," said Dr Adam Marshall, director of policy and external affairs at the BCC.
"For business, this is where ministerial rhetoric comes crashing down and reality bites. The argument that 'regulation could have been much worse' falls flat in the real world, where patience on de-regulation is wearing thin. Ministers have promised much and must deliver.
"Worst of all, this Statement doesn't include the Agency Workers' Directive; the proverbial elephant in the room. The government has already admitted that AWD will cost British business over £1.5bn each year, far more than any of the tiny regulations they are removing today.
"The Cabinet should have taken the chance to delay AWD, strip out the huge and unnecessary extra costs put in by our own civil servants, and save UK jobs."
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