Plans to change
the way that businesses experience ‘frontline enforcement’, such
as business inspections, were set out today by Business Secretary
Vince Cable, including a full scale review of UK regulatory bodies
and moves to cut the number of inspections for ‘compliant’ firms.
Details were published as part of the Government’s response to
the Transforming Regulatory Enforcement consultation
setting out how the Government will have a more mature and open
relationship with businesses when it comes to regulatory
enforcement, along with plans for a more transparent and
light-touch system and the creation of a Better Regulation
Delivery Office.
Dr Cable said:
“Business has said clearly that regulatory enforcement is too
often heavy-handed, inefficient and risk-averse – all of which
drains productive businesses of time and resources. They also
cited examples of good practice that we need to capture and build
on. That’s why we’re introducing a review of all regulators.
“We will also move to a transparent and light-touch system based
on real risks, including extending the successful Primary
Authority scheme and bringing the Local Better Regulation Office
(LBRO) into government as a new Better Regulation Delivery Office.
“We will end the tick-box approach to inspection, including
establishing sunset review clauses on most new statutory
regulators created in the future.”
Minister of State for Business and Enterprise Mark Prisk said:
"We have made good progress against excessive regulation
already by reducing the impact of red tape on businesses through
the radical system of One-in, One-out, the three-year
micro-business moratorium and the Red Tape Challenge.
"Now is the time to broaden the scope of the
deregulatory campaign by putting in place a comprehensive review
of UK regulatory bodies. Our aim is ambitious - to fundamentally
change not just regulations, but also how they're enforced."
During the summer the Government consulted with businesses to
gather their views on where reform of enforcement was needed and
where current approaches to enforcing regulation could be
lightened or made to work in more constructive ways.
The response sets out the Government’s plans to transform
business’ experience of regulation at the front line, including:
* A review of all regulators, not just to examine the case for
continued existence, but to make sure each one is making the
fullest possible use of alternatives to conventional enforcement
methods, working with business and others and reducing state
activity wherever possible.
* Making greater use of ‘earned recognition’, so that compliant
businesses are subject to fewer inspections and unnecessary
regulatory action.
* Doing away with the assumption that compliance is something for
the State to enforce alone, moving to a presumption that
regulators should work with business through ‘co-regulation’
wherever possible.
* Working with businesses, through local enterprise partnerships
and local authorities, to promote better local regulation.
* A presumption that regulators should help businesses comply
with the law.
* Establishing the principle that no business should face a
sanction for simply having asked a regulatory authority for
advice.
The Government will also introduce changes to the Primary
Authority scheme to improve the coherence, accountability and
transparency of local regulation. This will involve strengthening
inspection plans to deliver earned recognition for business;
allowing more organisations to participate, benefiting small
business; and including specific policy areas which are currently
out of scope: under-age sales of knives, gambling, and fire
safety.
The Government will also introduce sunset review clauses on most
new statutory regulators created in the future. It will also
retain the Regulator’s Compliance Code, giving it a higher
profile, making sure it is understood by customers and placing it
at the heart of reviews of regulators. And government departments
will have to consider carefully the costs of enforcement for
business and the taxpayer.
The LBRO will be reconstituted as the Better Regulation Delivery
Office (BRDO) within the Department for Business, Innovation and
Skills, operating alongside the Better Regulation Executive to
deliver a coherent programme of regulatory reform, and providing
comprehensive advice and support to UK and Welsh Ministers.
This comprehensive package of measures will transform the culture
of enforcement so that businesses will see a real difference,
becoming more like customers rather than simply on the receiving
end, of the regulatory enforcement system.
Notes to Editors:
1. In May 2010, the Government announced a new approach to
regulation: to reduce the burdens felt by businesses and create a
business environment that promotes growth and enterprise. A
business-led economic recovery will depend, at least in part, on
our ability to get to grips with every aspect of regulatory
enforcement that restricts the ability of businesses to grow,
creating jobs and prosperity, without reducing the important
protections essential to a mature democratic society.
2. The Government’s approach to reducing the burden of regulation
has 3 key parts:
* domestically we have brought in tough controls on the flow of
new regulation, to ensure that the UK government does not increase
the financial burden of regulation on UK business
* We are going through the entire stock of existing UK regulation
– and we are identifying many hundreds of existing regulations
that can be simplified, liberalised, or removed altogether.
* pushing hard within the EU for an outcomes-focused approach to
regulation, based on a real understanding of its impact, and for
the EU as a whole to take deregulation seriously
3. The Government carried out a comprehensive review of public
bodies in 2010 as part of the commitment to radically increase the
transparency and accountability of all public services. The review
of the Local Better Regulation Office (LBRO) concluded there were
advantages in it ceasing to operate as a Non-Departmental Public
Body and instead moving to become part of the Department for
Business, Innovation and Skills (BIS).
4. The reviews will follow a two-stage approach: a comprehensive
evidence-gathering stage to build a detailed view of the entire
regulatory landscape; before undertaking further decisions on a
prioritised programme of reviews in spring next year.
5. Economic regulators (Ofgem, Ofwat, Ofcom, the Civil Aviation
Authority and the Office for Rail Regulation) and new regulators
in the financial services and nuclear sector will be excluded from
the policy on sunset clauses.
6. BIS's online newsroom contains the latest press
notices, speeches, as well as video and images for download. It
also features an up to date list of BIS press office contacts. See
http://www.bis.gov.uk/newsroom
for more information.
Contacts:
BIS Press Office
NDS.BIS@coi.gsi.gov.uk
Aidan Steer
Phone: 020 7215 5245
aidan.steer@bis.gsi.gov.uk