Mark Prisk MP: How the Government is cutting regulation and freeing our small firms to thrive

Mark Prisk is Minister of State for Business and Enterprise.

In recent months, people have rightly been asking what progress we have made freeing enterprise from red tape and bureaucracy, so I wanted to update ConservativeHome readers on what we have achieved since the start of the year.

The ‘One In, One Out’ system of regulatory control is designed to change the culture of over-regulation in Whitehall – and it’s in place and working right now. All Ministers are required to identify reductions in regulatory costs to business (‘outs’) if they wish to introduce new regulations that have a cost to business (‘ins’). Twice a year, we will issue a statement summarising these ‘ins’ and ‘outs’.

The first statement, for January to June of this year, cut the number of regulations planned from 157 to 46, with just 11 of these adding to the regulatory cost faced by firms. The other 35 were either zero cost or have costs now matched by savings found from within their sponsoring department. Measured by value, the results are even better: a net saving of £3.2 billion for British firms.

The results don’t end there. We are taking action across the board, and have:

• Scrapped proposals for specific regulations which would have cost business over £350 million a year. This includes not extending the right to request time to train to businesses with fewer than 250 employees and not bringing forward the dual discrimination rule.
• Introduced an unprecedented moratorium on new domestic regulation for micro businesses and start-ups for the next three years.
• Introduced ‘sunset clauses’ into new regulations so that policy makers have to review that regulation after five years to determine whether it remains relevant. 
• Ended the ‘gold plating’ of new EU regulations so that British firms are not placed at a disadvantage compared to their EU competitors. We are avoiding the early implementation of EU regulations and copying them straight from the directive into UK law so that they don’t pick up any burdensome extras on the way.
• Announced plans to implement the proposals from Lord Young’s review of health and safety. This includes bringing in new risk assessment tools, the registration of health and safety consultants, combined inspection programmes and taking action to constrain ‘no win, no-fee’ legal services.
• Begun a public audit of all 21,000 regulations currently in force with a presumption that burdensome regulations will be removed. Everyone can get involved to tell us the regulations that work and those that don’t, what can be changed and what can be kept, by logging onto www.redtapechallenge.co.uk.
• Consulted on changes to employment law that will give business the confidence to take on staff. We are increasing the qualifying period for employees to be able to bring a claim for unfair dismissal from one to two years and introducing fees for lodging employment tribunal cases to tackle vexatious claims.
• Announced a major shake-up of the planning system. A powerful new presumption in favour of sustainable development, a streamlined system for planning applications and new fast-track planning for major infrastructure will strip out the waste and bureaucracy from the planning system.
• Reduced the number of UK SMEs required to undertake an audit and reduced the burden of financial accounting for UK businesses.  We will bring forward legislation in 2012 to exempt many subsidiaries from producing audited accounts and match only the minimum accounting standards required by EU law.
• Begun seeking to revise a series of EU regulations and directives. Specific areas where we believe improvements can be made include EU-sourced trade regulation, EU maternity and paternity rights, the Clinical Trials Directive, and the Information and Consultation of Employees Directive.
• Pushed the European Commission to deliver a culture change that bears down on the overall level of regulation. In particular, we want to strengthen the SME test so that micro businesses with fewer than 10 employees are generally exempted from European legislation.

Earlier this week, the IMF comprehensively backed George Osborne’s deficit reduction plan, to the dismay of Ed Balls and the other deficit deniers. Tackling the deficit is a vital pre-requisite for balanced, sustainable economic growth, but there is so much more that we can and must do – and that is why cutting regulation and freeing our small firms to thrive and compete is right at the top of this Government’s agenda.