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Marjorie Mowlam: If the hon. Gentleman wants me to cite the Conservative party's record, he will find that he is not in a strong position to criticise.
Digby Jones of the Confederation of British Industry said:
- "The Bill has the potential of providing the tools to deliver real benefits to business".
The Federation of Small Businesses believes
- "that the Bill will be useful in helping to reduce the overall burden on business".
- "reducing the burden of central regulation on local authorities".
Contrary to some press reports, the United Kingdom is not a heavily regulated society. Independent reports, such as that from the Economist Intelligence Unit in spring last year, show that we have the least regulated labour market in Europe. Similarly, the Organisation for Economic Co-operation and Development's economic outlook, published in December 1999, said that the United Kingdom had the lowest level of product-market regulation of any OECD country.
We can be proud of that record, while being proud of the fact that the Government have introduced important measures to safeguard the interests of consumers and employees and to protect the environment. It can no longer be said that social justice--the minimum wage, decent holiday entitlements, decent maternity pay and working benefits--is incompatible with economic efficiency, low unemployment, low inflation and low interest rates. It has taken this Government to show that, and it is a record of which I am proud.
4.3 pm
Mr. Andrew Lansley (South Cambridgeshire): I beg to move, To leave out from "That" to the end of the Question, and to add instead thereof:
- "this House declines to give a Second Reading to the Regulatory Reform Bill [Lords] because it seeks to extend the use of powers intended solely for a deregulatory purpose to the creation of new burdens and to the rewriting of legislation without a specific deregulatory effect; and fails to apply sufficient consultative, scrutiny and review provisions to the exceptional powers proposed."
In April 1997, in a document entitled "Labour's business manifesto"--which seems to be a contradiction in terms--the Labour party pledged
- "not to impose burdensome regulations on business, because we understand that successful business must keep costs down."
Mr. White: Is it not true that 3,000 regulations were implemented in the final year of the previous Conservative Government?
Mr. Lansley: The director general of the British Chambers of Commerce said that about 3,000 to 3,500 regulations and statutory instruments are passed each year and, in an article in The Times in November 2000, the Parliamentary Secretary, Cabinet Office said that only about 5 per cent. of them have a direct impact on business. Let us leave aside the fact that many of them have an indirect impact but, even if the figure of 5 per cent. is correct, that means that 175 of the statutory instruments
passed each year have a direct impact on business. Furthermore, they come on top of the 175 that were passed in each of the preceding years.If the hon. Gentleman wants to understand what is happening under this Government, let us consider the rate at which red tape is impacting on business and on small businesses in particular. Small businesses are acutely vulnerable to the impact of burdensome regulations, and members of the Government never seem to be aware of that fact--I guess that they never run a small business. Perhaps some of them do so. In recent days, we have discovered that one or two of them have been engaged in business on their own account, but I shall not go into that.
The rate at which the cost of red tape is increasing has gone up. Each year, the Institute of Chartered Accountants conducts a survey based on information obtained by its advisers who conduct and prepare the accounts of small businesses. It uses their expertise to consider the cost to businesses each year of implementing the new regulations that were introduced in the preceding year. In October 2000, the institute showed not only that the regulations increased the costs of small businesses by an average of 4 to 6 per cent., but that for the smallest and micro businesses the rate at which those costs increased nearly doubled in the year to July 2000 compared with 1999.
Mr. Bercow: Is my hon. Friend aware that, at various stages over the past four years, some Ministers appear to have been so unfocused that they were unaware of what their own Government were doing? In particular, is he aware that the right hon. Member for Hartlepool (Mr. Mandelson), who was then the Secretary of State for Trade and Industry, said in what proved almost to be his swan-song that
- "we have no intention of introducing any legislation that presents a burden on business and reduces the competitiveness of British firms."--[Official Report, 25 November 1998; Vol. 321, c. 214.]
Mr. Lansley: I concur with my hon. Friend's observation. I have been interested in what Ministers seem to be unaware of, and there are two explanations for the statement of the right hon. Member for Hartlepool (Mr. Mandelson). The first is that it has become part of his stock in trade--indeed, that of the Labour Government--to say one thing while doing something completely different. It is not that Ministers do not know what is happening, but that they want people to believe that something else is happening. They want the public at large not to understand that manufacturing and business experience daily the problem of increasing red tape.
The second explanation for the right hon. Gentleman's statement is that in November 1998 he was otherwise engaged busily raising money for the dome, for which he was responsible at that time.
Marjorie Mowlam: If we are considering issues of which folk are aware, I am sure that the hon. Gentleman is aware of the Small Business Service, which we set up. It specifically focuses its work on assisting small businesses with regulations. We have extended the periods in which regulations are implemented and we have given audit exemptions by raising the threshold from
£350,000 to £1 million, which has saved small businesses £180 million a year. We have taken a number of other initiatives. I will not bore the hon. Gentleman with them now, but they do not suggest that this is a Government who do not take the needs of small businesses into account.
Mr. Lansley: The Small Business Service amply illustrates the point made by my hon. Friend the Member for Buckingham (Mr. Bercow) and with which I agreed. The Government set up the Small Business Service with the objective that it would be the British equivalent of the Small Business Administration and would act as a powerful engine to represent the small business community inside government.
I have news for the right hon. Lady. She and the Secretary of State for Trade and Industry may not have noticed that the business community sees the Small Business Service as no more than a repackaging of what went before. In the enterprise component of the training and enterprise councils, business links and various other bodies, the Government sought to impose initiatives on the business community. They have not allowed the business community to take ownership of the service in the way that the previous Conservative Administration intended.
The right hon. Lady seems to think that I am personally responsible for everything that the previous Conservative Administration did. She should know that as leader of the deregulation taskforce, my right hon. Friend the Member for Horsham (Mr. Maude) made it clear that, in his view, the Conservative Government were making limited steps towards deregulation. At the same time as we were trying to introduce a substantial number of deregulatory measures, the cumulative burden of regulation was continuing to increase. That is why we have the policies that we have, which I shall deal with shortly. On that basis, she should understand that this Government have gone badly in the wrong direction by increasing dramatically the cumulative burden on businesses.
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