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Adam Smith Inst - 1000 Statutory Instruments Last Year Wrapped Britain in Red Tape

The rule of law and Britain’s economic prosperity is being undermined by excessive legislating and regulating, a new report from the free market think tank the Adam Smith Institute claims.

  • Red tape costs businesses £100 billion a year, a substantial portion of which is spent simply searching for the law.
  • There were 1,000 new regulations or ‘statutory instruments’ in 2020, as Covid-19 and Brexit led to the proliferation of new rules
  • 329 were Covid 19-related with an average of 8 per week after 6 March 2020
  • Post-Covid and post-Brexit prosperity depends on reducing, simplifying, and that starts with properly cataloguing the law with reference to relevant cases.
  • Citizens and companies should be able to search for laws pertaining to an issue and see relevant case law and statutory instruments updates on with all new rules added via accessible website, data feed (XML, JSON), and PDF formats.

The quantity of law has grown unchecked and often even unspecified, making it impossible for citizens and businesses to discover the rules let alone follow them. The growing red tape burder undermines the rule of law and the United Kingdom's economic prosperity. This is the dire warning by report author Robin Ellison — a Visiting Professor in Pensions Law and Economics at The Business School, City, University of London.

Worse still, the Institute says that the United Kingdom lacks a depository of all laws and regulations. Judges and lawyers, let alone citizens and businesses, often complain about the difficulty ascertaining the state of the law. The inability to identify the law has led to unfair application including common sentencing mistakes.

Citizens must comply with an ever expanding array of legislation, regulations known as ‘statutory instruments’ (of which there were over 1,000 in 2020), imported European Union legislation, and tens of thousands of pages of materials issued by dozens of regulatory agencies. 

In 2017 the National Audit Office estimated the cost of regulation in the UK to be around £100bn. Searching for what are the applicable rules in any given situation will be a material part of the total regulatory burden. This includes the cost of compliance officers, legal  advisers, subscriptions to services such as WestLaw, LexisNexis and Halsbury, and compliance support organisations. 

The extent of legislation and regulation creates substantial economic costs, including pushing up prices for consumers, reducing wages for workers and creating disproportionate burdens on small businesses.

The Institute is calling for all types of law, including legislation, regulation, and departmental guidance to be reduced, simplified and catalogued. They are also calling for new rules such as one-in-three-out, targets for reductions in restrictive clauses (known as RegData) and extensive sunsetting rules.

To reduce the cost burden of red tape as far as possible, the Institute argues that Ministers should be required to assess all possible consequences of laws coming in, with rules required to have externally validated cost calculations. This would represent an upfront cost to Whitehall’s operations, but hopefully avoid passing on unintended costs to the private and public sectors implementing the rules in full.

The free market think tank also says that Britain has lessons to learn from her fellow English language parliamentary democracies Australia and New Zealand. Publication of laws in the antipodean states are accompanied by explanatory memoranda, parliamentary debates  and other documents designed to help the user understand the purpose and thinking behind the laws in place, as well as the politics of the Chamber during decisions. While debates prior to broadcast or written records of debate are not easily added to laws, new laws could see the addition of relevant information added from the Parliament’s extensive modern record keeping to ensure citizens are well informed well past the date of a law’s Royal Assent.

Report author Robin Ellison, a Visiting Professor at City, University of London, says:

“It has become unfair to expect citizens to understand the law. There is so much of it and it’s constantly changing — and, adding insult to injury, there isn’t even a reliable depository of the rules we expect citizens to follow. This severely undermines the rule of law and hamstrings businesses with huge red tape costs.

“Brexit offers a unique opportunity to simplify and improve our legal system, whilst saving money and improving access to legal information. There is a desperate need to both clarify what is the law, and reduce its complexity and length.”

Head of Research at the Adam Smith Institute Matthew Lesh, said:

“Covid has highlighted the dire consequences of lawmaking that is rushed, incoherent and easily misunderstood. We expect every citizen to follow the law, but make that practically impossible by its length, complexity and lack of depository. When even judges and lawyers struggle to identify the law you know there’s a problem.

“The constant proliferation of new laws, regulations and guidance is creating extraordinary burdens on citizens and businesses. For Britain to recover from Covid and succeed after Brexit there is a desperate need to cut the red tape that is strangling British businesses and make the law easily understandable by all citizens.”

Notes to editors:

The Adam Smith Institute is a free market, neoliberal think tank based in London. It advocates classically liberal public policies to create a richer, freer world.

The report Ignorantia legis: How the growing red tape burden undermines the rule of law and economic prosperity is available on the Adam Smith Institute website.The report can be accessed via the link here.

Robin Ellison is a Visiting Professor in Pensions Law and Economics at The Business School, City, University of London, a consultant with Pinsent Masons, and author of numerous books on pensions law and on regulation.

How Coronavirus impacted law-making:

In total there have been 329 Coronavirus-related Statutory Instruments laid before the UK Parliament in 2020. There have been an average of eight per week since 6 March. Covid 19-related statutory instruments represented about a third of all SIs during 2020, using powers from 109 Acts of Parliament including the Saint Helena Act 1833, the British Settlements Act 1887 and the Colonial Probates Act 1892. Two hundred and twenty six were made under the ‘negative procedure’, so that they became law unless a motion against them was carried, which in any event requires the Government to grant time for such a motion to be debated. One hundred and forty five of the instruments breached the 21-day rule and came into force less than 21 days after they were laid, and 42 came into force even before they were laid. 

Some of them were prepared so quickly that they had to be corrected within days. The Statutory Sick Pay (General) Regulations 1982 were amended twice within four days. On 2-3 September 2020 the ‘protected areas’ covered by the Health Protection (Coronavirus Restrictions) (Blackburn with Darwen and Bradford) Regulations 2020 were amended twice in 12 hours. The Health Protection (Coronavirus, Wearing of Face Coverings in a Relevant Place) (England) Regulations 2020 were amended by three different SIs made in two days on 22-23 September 2020.

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