A report published today by the British Chambers of Commerce (BCC) compares the UK and EU regulatory systems, finding them to be worlds apart with no effective communication between them.
The report also suggests that MPs are failing to curb the flow of new regulation and as a result, the competitiveness of British business is reduced.
In a review of 246 Impact Assessments (IAs), which measure the cost of regulation, the report’s authors, Tim Ambler, Senior Fellow at London Business School and Francis Chittenden, Professor at Manchester Business School, argue that the UK’s formal consideration of proposed European law arrives far too late to amend the legislation prior to its enactment. The UK’s 12 EU Parliamentary Scrutiny committees process a mass of paper to no visible benefit and unconnected from the UK’s IA system, which should cover the same ground.
With the EU accounting for a cumulative £53 billion cost of new regulation to business since 1998, it is vitally important for the UK’s IA process to be synchronised with the EU’s. By failing to do this, the two systems are totally disjointed and at a substantial cost to UK companies. UK-only regulation also requires far stronger challenge from MPs who now merely rubber stamp it through without asking the key question: why does the UK need this new regulatory burden when the rest of Europe does not?
Commenting, David Frost, Director General of the BCC, said:
“If we are to see a better regulatory environment for business then the government must engage earlier in the EU’s policymaking process. This report highlights the fact that the government is only focused on the UK end of EU legislation. There must be a clear link between events in Brussels and the UK’s own consultation process. “The cumulative cost of new regulation to business since 1998 is now £76 billion – some £53 billion of this is EU sourced. Without timely engagement and substantive consultation, the UK’s ability to influence EU policy to the benefit of British business, and also the EU as a whole, is severely limited.”
Tim Ambler from the London Business School added: "Ministers and civil servants have usurped Parliament’s fundamental role as legislators. It is high time MPs asserted their authority and rejected unnecessary regulation.” Francis Chittenden from the Manchester Business School added: "UK impact assessments for proposed regulations are not perfect, but they are better than the EU’s. However, our IAs are seldom available in time to guide decisions in Brussels. For the UK this is a missed opportunity.”