Business Regulation (Hansard, 10 January 2002)

§ The Minister for the Cabinet Office and Chancellor of the Duchy of Lancaster (Lord Macdonald of Tradeston)
My Lords, the UK is one of the leading EU member states in trying to improve the European regulatory environment. The survey reported in the internal market scoreboard is one of a number and covers only a narrow range of firms. Figures show that the UK is the largest recipient of inward investment in Europe and several other studies by the OECD, Arthur Andersen and the Economist Intelligence Unit show it to have one of the most lightly regulated of the world's economies.

§ Baroness Miller of Hendon
My Lords, I thank the Minister for that Answer. Does he remember that when the Government took office in 1997 they pledged themselves to reduce red tape and regulation? Can he therefore explain to the House how it is that during their First term in Parliament the Government introduced more than 14,000 new regulations—a record-breaking number—and an extra burden on businesses of more than £15 billion; and how during that period we slipped from 9th to 19th in the global competitive league, according to the highly respected International Institute for Management Development?

§ Lord Macdonald of Tradeston
My Lords, I question the total of 14,000. It has been alleged by the Opposition party that 3,500 new regulations have been introduced in the past year, but that figure confuses the number of statutory instruments with the number of regulations on business. The number of statutory instruments introduced each year has ranged from 3,200 to slightly under 3,500 during the last decade. More than 95 per cent of those SIs have no impact on business and many have a local or temporary effect—for example, road traffic orders. I should point out that, despite the assertions made about the state of our economy, it has been said by Digby Jones of the CBI that low interest rates, low inflation and low unemployment make us the most successful economy in western Europe.

§ Lord Tomlinson
My Lords, is my noble friend aware that there is a paradox in the attitude of noble 684 Members opposite? On the one hand, they are increasingly Eurosceptical and, on the other, they want to quote every critical view that emerges from the European Commission. That paradox is somewhat highlighted when one recalls the words of the then leader of the race for the Conservative leadership, Mr Michael Portillo. Is my noble friend aware that he said on the "Today" programme on 5th July 2000 that, even after three years of Labour government, relatively we are, on average, less taxed and less regulated than our continental partners?

§ Lord Macdonald of Tradeston
My Lords, my noble friend asked me whether I recall the quote. I do indeed—with some relish. We are making good progress inside the European Union through the Mandelkern Group, which has been working to harmonise the regulatory environment across the EU. In that, it is taking its lead in many matters from the precedent that we have set in Britain.

§ Lord Razzall
My Lords, will the Minister allow me to give him an even softer ball than the one given to him by his colleague? Does he agree that the previous government imposed a significant element of business regulation on this country which manufacturing industry, in particular, still regrets? Having given him that soft ball, which I am sure he will serve with his normal prowess, does he also accept that it is about time that Her Majesty's Government indicated when they will make the bonfire of regulations that they promised in their election manifesto?

§ Lord Macdonald of Tradeston
My Lords, let me list for the noble Lord's benefit the number of initiatives that we have taken. We have, for instance, strengthened the Regulatory Impact Unit; we have brought in an enforcement concordat which has allowed business to work more closely with local government; we have mandated regulatory impact assessments, as noble Lords will know through dealing with the legislation in the House; and we have a ministerial panel for regulatory accountability. The Regulatory Reform Act has been passed and has produced regulatory reform orders. The first order—which, the House will be pleased to hear, extended New Year drinking—was passed in December. We anticipate that there may be 50 to 100 of these fast-track regulatory reform orders in prospect. We also have regulatory reform action plans, which we anticipate publishing shortly, which include about 300 measures. In addition, of course, we have set up a small business service to ensure that the interests of business are served in the regulatory sphere.

§ Lord Tanlaw
My Lords—

§ Baroness O'Cathain
My Lords—

§ Lord Willoughby de Broke
My Lords—

§ Lord Tanlaw
My Lords, I am grateful to noble Lords opposite for giving way. Can the Minister say 685 whether the harmonisation of the time-scale of the United Kingdom with that of Europe is part of the harmonisation programme to which he referred?

§ Lord Macdonald of Tradeston
My Lords, I am not sure that I fully understand the question, and for that I apologise. As I said, we have been working with other countries in the EU on the Mandelkern Group. We strongly support its final report, which sets out a series of recommendations. It was brought before the Laeken summit in December and will be taken forward to Barcelona in March. We are also trying to improve our record on the transposing of EU single market directives. We have fallen very slightly behind other countries in transposing European law into British law. I regret that we have not been quite as zealous as was the party opposite in that respect. We have therefore gone down the league table a little as regards imposing European regulation in Britain.

§ Lord Willoughby de Broke
My Lords, if, as they say, the Government have been so helpful to business, and to small business in particular, will the Minister explain the position? He did not answer the main point put to him by my noble friend Lady Miller. If the Government have been so helpful to business, how has this country slipped from 9th to 19th in the world competitiveness league?

§ Lord Macdonald of Tradeston
My Lords, the quotes from the CBI indicated, in its words, that this country presently has the most successful economy in western Europe. Deloitte & Touche expressed the view that the UK will escape a recession proper, and that it is the best-performing country in the G7. Those are not quotes attracted by an under-performing economy. The Economist Intelligence Unit found that, rated against 70 factors, including flexibility of the labour market and openness to foreign investment, the UK ranked third among the 60 largest economies in the world according to how good they are to do business in. Arthur Andersen's ranked the UK first for its policy towards private enterprise and competition. Those are both recent reports.