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Mr. Iain Duncan Smith (Chingford): I have come in specifically to listen to my hon. Friend's speech. One of the core problems, surely, is that civil servants here and in Europe want to tidy up the process of democracy and get things running quickly and smoothly. Therein lies the problem with statutory instruments--the more quickly we ram them through this place, the less chance there is to consider them carefully. If people have the opportunity to examine them slowly and ask questions about them, there is more chance of their emerging in the right form.
Should we not try to change the system here and return to scrutinising more of the documents on the Floor of the House, to slow them up?
Mr. Steen:
I am all for anything that will stop this place becoming a county council and power leaking away to the Brussels bureaucracy. I am most grateful to my hon. Friend for joining in this important debate.
In answer to my parliamentary questions to all Government Departments suggesting that we remove the add-ons, Departments wrote to say that they could not even tell me how many add-ons there have been in the past three years, let alone the past 25, because the exercise could be done only at "disproportionate cost". Disproportionate to what?
In the past three years, the Department of Trade and Industry has implemented 33 directives; MAFF has implemented 113. Surely, with our modern technology, officials could find out which of those directives have been added to. If they lack the time, what about using the 43 staff in the deregulation unit? They could be put to work on this important task straight away.
A good example of the damage done by gold plating is a small oyster farm in my constituency which, for the past eight years, has successfully sold about 70,000 oysters a year. It has been vetted and approved by the local environmental health people from South Hams district council. The farm uses a system that recycles sea water--a system introduced by Captain Philip Gibbon, a well-known environmentalist who is hostile to pollution.
The proprietor uses a system that is entirely consistent with the rules in the European Community's shellfish hygiene directive 91/492/EC. There are seven identical farms in the Netherlands which seem to operate successfully without falling foul of Dutch or EC law. The problem, therefore, is not the local health officers but the Government's officials in Weymouth, who are refusing to grant a licence to Captain Gibbon.
The problem is further compounded by the lack of an appeal mechanism. During the passage of the Deregulation and Contracting Out Bill, I and other colleagues pressed for a local appeals mechanism. If officials and business men disagreed locally, there should be an appeal procedure in the local magistrates court, we argued. The Government opposed the idea; two years later, all we have is a consultative draft statutory instrument--yet another one.
So Captain Gibbon has nowhere to go. He has closed the plant. Do we want to create small firms or close them? Ours, after all, is supposed to be the party of small business. Yet Captain Gibbon has been clobbered by regulatory initiatives and the zeal of MAFF officials. All he can do now is go--believe it or not--to the European Commission; or he can take up the suggestion of the Fisheries Minister and go to the Ministry with the chief environmental health officer of South Hams district council and MAFF officials, whereupon the Minister will try to act as judge in the case.
Deregulation is just not happening in the way we were promised. It is proving much more difficult than we thought at first. A stick and carrot approach should be introduced: promotion for those who deregulate and demotion for those who do not. Let us get rid of private Members' Bills in their current form. What we want are
private Members' deregulatory Bills. Members in the new Session should be allowed to introduce only deregulatory measures, not new legislation.
I also suggest a review of the gold plating on all the directives implemented here over the past 25 years. That should be done in the next three months by the deregulation unit in the Cabinet Office. Just as the Treasury approves all Government Departments' expenditure, the Cabinet Office must do likewise for all statutory instruments, directives, rules and regulations emanating from Government Departments. The Cabinet Office should vet every statutory instrument and should have a Treasury-like veto on deregulation. The Minister could make a great deal of progress in this area.
The Chancellor of the Duchy of Lancaster (Mr. Roger Freeman):
I welcome the debate and congratulate my hon. Friend the Member for South Hams (Mr. Steen) on it. It is noticeable that, while Conservative Members take an interest in the subject of deregulation, not a single Opposition Member is here for the debate. We have noted not just the Opposition's lack of interest but even their hostility to the notion of deregulation, to the unit in the Cabinet Office and to the deregulation task force. We have an immense task before us, and I thank my hon. Friend for taking such a close interest in it.
I sometimes feel like a remote descendant of King Canute. The tide of legislation--primary and secondary, European and domestic--keeps coming in, and one does one's best, with the help and support of my hon. Friend and Government colleagues, to stem it. As life becomes more complicated, we inevitably need more regulation, but it has to be better and simpler. When we introduce new regulations, we must take the opportunity of repeal.
My hon. Friend rightly referred to the need for a change of culture. That change of culture must occur not only in Whitehall, but in Brussels. I shall have something to say about that in the remaining 11 minutes of the debate.
My hon. Friend was right to stress the importance of small businesses and the impact of regulations on them as employment growth depends on small businesses. I have long believed that regulation should be a rhetoric-free zone. The devil is in the detail. It is boring, it is difficult and, as the Duke of Wellington used to say, it is very hard pounding, but it is essential work.
I shall divide my remarks equally between a brief resume of what we have achieved so far and what we need to do. I note from the Order Paper that tonight we shall be asked to vote on three excellent deregulation measures resulting from the deregulation and contracting out procedure. My hon. Friend is right to say that we have laid only 26 such measures and 12 have become law so far, but more significant measures will be laid.
I commend the cheque truncation order, which will save the banking industry many millions of pounds by avoiding the unnecessary circulation of old cheques once they have been drawn, debited and credited to accounts.
The compliance cost assessment procedure is working reasonably well. I take my hon. Friend's point about public sector costs and I shall look again at that part of the procedure. We have just published a new booklet on the other side of compliance cost--the risks and benefits to society of proceeding with legislation. I commend that new booklet to the House and I have circulated it to all Departments. In respect of all legislation--primary, secondary, European and Whitehall generated--we should be looking at the cost and the benefit and taking a deep breath and deciding not to proceed when Ministers are not convinced that there is an overwhelming case for proceeding.
We are looking at statutory instruments ex poste--or after Ministers have approved them. I shall say more about that in a moment. In respect of Europe, I am going to Brussels on Tuesday, to the Internal Market Council, which will consider a resolution that I hope will commend itself to most countries. It instructs the Commission to adopt new policy procedures in respect of the impact of regulations on small firms and to reaffirm the principle of proportionality, and it urges the Commission to draw up directives that are goal based and not prescriptive.
I am pleased that the Commission has adopted new procedures--before agreeing directives and proposing them to Councils of Ministers--on the principle of consultation, assessing the costs, improving the principle of the fiche d'impact system that has operated for a number of years--I believe, unsatisfactorily--and re-emphasising the need for subsidiarity, that is, not legislating in the first place if it is not necessary.
I am pleased that, since November, when we began our campaign in Europe, we have reaped some modest fruits of that effort. We have achieved an exemption for unit pricing for small businesses. That is a small but welcome step forward. Following the Internal Market Council meeting on Tuesday, the Commission will set to work on codifying and simplifying blocks of legislation in respect of Intrastat--documents dealing with imports and exports in Europe--and construction products in an attempt to simplify the regulations to enhance Community trade. I hope that next year we shall simplify regulations on machine standards and food hygiene.
We have published a new checklist for Departments dealing with gold plating. My hon. Friend is absolutely right to focus on that and I have to admit that he is correct. We are now looking to stop gold plating. My Department does not have the staff or resources--even with my 42 excellent civil servants--to go back not just 24 years to accession, but 700 years of statute law.
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