Britain at a regulatory tipping point

Oct 19 2006 by Brian Amble Print This Article

Britain's sense of adventure, enterprise and competitive edge is being fatally undermined by a growing army of bureaucrats and politicians terrified of risk and determined to regulate for every eventuality.

This damaging indictment of Britain's political culture is the key message of a new report from the government's own Better Regulation Commission (BRC), a body established in 2005 to provide independent advice to government about the impact of regulatory proposals and about the government's overall regulatory performance.

"Risk, Responsibility, Regulation: Whose Risk Is It Anyway?" argues that regulatory overkill and intrusive government intervention is in danger of taking the place of personal responsibility and that the national attitude to risk is becoming defensive and disproportionate.

Intrusive government intervention is in danger of taking the place of personal responsibility

The report demands that the government launch campaign against its own regulatory inconsistencies and absurdities and "re–examine areas where the state is considered to have gone too far in its interference of our freedoms."

The government, it insists, needs to spell out that there are costs as well as benefits of risk reduction measures. "It must explode the myth that the government can and should manage all risk. It must admit that zero risk is unachievable, unattainable and undesirable."

The growing litany of regulatory overkill in Britain ranges from the absurd – such as local councils cutting down Horse Chestnut trees in case passers-by were hit by falling conkers – to what the report terms "less obvious but more costly examples" such as planning rules and airport security measures which have a long-tern impact on economic activity and drive business away from the UK. .

Despite repeated assertions from the government that it wants to cut the burden of regulation, the British Chambers of Commerce has estimated that the cost to business of complying with the regulations introduced since Labour came to power is now some £50bn a year.

Yet despite this, the BRC points out that there have been 33 Acts of Parliament and at least 1,000 regulations introduced so far this year alone.

Rick Haythornthwaite, Managing Director of fund manager Star Capital Partners and Chairman of the Better Regulation Commission, said that the issue had now come to a head.

"A growing majority of people from all walks of life feel we have reached a regulatory tipping point. People are no longer convinced that having more and more rules is the best way to solve problems," he said.

Speaking to the Daily Telegraph newspaper, Haythornthwaite added:

"We have all, in our view, been complicit in a drive to purge risk from our lives and we have drifted towards a disproportionate attitude to the risks we should expect to take."

"We have all called on the state to manage the process on our behalf, and each incremental intervention has seemed justified by the immediate benefits."

The report calls for government to lead a national debate which explores three key questions. What becomes possible if we trust people more and regulate them less? What happens if classic state regulation is limited to a last resort rather than a first instinct? And how far are people ready to take more responsibility for managing their own risks?

What's more, it argues, ministers and civil servants need urgently educating risk management in order to reduce "knee jerk regulation".

"Britain is rightly famous for the achievements of our entrepreneurs, risk takers, adventurers and explorers," Rick Haythornthwaite said.

"We have always pushed boundaries and taken risks in search of greater rewards. Now, our national resilience, self reliance and spirit of adventure could be threatened by a culture that demands the progressive elimination of risk through more and more regulation."