DBT announces regulator review ‘to cut red tape and bureaucracy’

Exercise will cover 90 bodies and look to “capitalise” on post-Brexit freedoms
Business secretary Kemi Badenoch Photo: Parliament UK

By Jim Dunton

03 Oct 2023

Business secretary Kemi Badenoch has pledged to kick off a new review of UK regulators that will “root out” bad practices holding business back and make the most of the nation’s ability to set its own regulatory landscape outside of the European Union.

The move, announced yesterday, has echoes of the coalition government’s “Red Tape Challenge” which ran from 2011 to 2014 and encouraged individuals and businesses to flag burdensome regulations ripe for scrapping or reform.

The Department for Business and Trade said the latest exercise would run for 12 weeks and “seek views of businesses, consumers and regulators to establish areas that are working well as well as where regulators could improve”.

DBT said the review would cover all of the UK’s regulators – around 90 bodies – and would “seek to capitalise on our post-Brexit freedoms to bring about smarter regulation to the economy”.

The call for evidence, which has yet to formally open, will form part of the government’s ongoing Smarter Regulation Programme. DBT said it would be complementary to other work already under way, which includes more specific reviews of regulators Ofgem, Ofwat and Ofcom.

The department said the nation spent £5bn a year on its regulators but added that 39% of small businesses reported that “red tape” held them back.

Business secretary Badenoch said burdensome regulations were an obstacle to economic growth and that the review would identify changes to the regulatory landscape that would make a difference to economic growth and help householders.

“I want us to use our Brexit freedoms to scrap unnecessary regulations that hold back firms and hamper growth,” she said.

“It’s clear that the regulators that enforce the rules can also sometimes be a blocker to businesses, so our review will seek to root out the bad practices with the aim of making companies’ lives easier and reducing costs for consumers.”

DBT said businesses, industry leaders and consumer groups complained that the regulatory landscape had become “a crowded space” and that many regulators had “too many duties to trade-off against each other”, underscoring a need for consistency and clear direction.

It added that business and industry groups in particular argued that the UK’s regulators are “overly risk averse” and focused too heavily on process rather than delivering the best outcomes.

Evidence to the Grenfell Tower Inquiry probing the root causes of the 2017 tower-block fire that claimed 72 lives heard that the coalition government’s Red Tape Challenge had been an obstacle to introducing new building-safety rules that could potentially have prevented the tragedy.

Former Ministry of Housing, Communities and Local Government permanent secretary Dame Melanie Dawes was one of the current and ex-officials who referenced the Red Tape Challenge at the inquiry last year.

She said the challenge and its “one-in,one-out” requirement for new regulations, which later ramped up to “one-in, three-out”,  stacked the odds against any wide-ranging reform of the nation’s building-safety system pre-Grenfell.

Nevertheless, Dawes expressed “deep regret” at the department’s failure to recognise the warning signs from other tower-block fires in the two decades before Grenfell – or to properly understand its role in the regulatory system for buildings.

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