REGULATORY ECONOMY

THREE years ago, when he was Chancellor of the Exchequer, Gordon Brown set up the Better Regulation Task Force to look at ways in which the increasing amount of government regulation affecting businesses in BritaIn might be reduced. Yesterday one of the results of that Task Force inquiry was announced by the government's Better Regulation Executive. It is proposed that in future government departments will be required to estimate the probable cost of introducing new regulations and to keep within an overall budget allocated for this purpose.

Hardly an interview is heard on TV or radio with UK business representatives (or with the Conservative opposition) that does not contain a complaint about “red tape and regulations”. Some of these are justified but there is always a conflict between calls for government to take action to deal with particular problems, which may inevitably require new regulations to be effective, and the call for a bonfire of red tape. A balance has to be struck and the new proposals may at least put a brake on the instinct of civil servants, if not always of ministers, to write new regulations when to do so seems the easiest solution. The government estimates that companies spend some 13bn pounds annually in complying with government regulations and believes that the new measures it has in mind should reduce that burden by about one-quarter. Of course, these measures to cut regulations will need regulations to operate them!