Dr Lee Rotherham is author of Land of the Superwoke, second edition available on Kindle, and was twice a Conservative Parliamentary Candidate.
There is a noxious myth circulating lazier fringes of politics right now. It is a fairy tale about Brussels red tape.
The storytellers relate it’s all supposedly too difficult to unravel, so shouldn’t be attempted. The full list is impossible to know as new examples keep being discovered under the sofa. And, in any case, no one really should make any changes: diverging from the EU copybook is inherently bad. Consequently, all this should just be forgotten about.
Such honeyed words are a mirage, a parody of the facts that are convenient for anyone whose silent agenda is to Rejoin the EU. Indeed, Barnier casually made the very point when visiting London last week.
This much is true: EU regulations and directives do form a major block of domestic law and do generate a lot of business costs. We know this because Whitehall’s own past internal audits have revealed it, a field I have been tracking since John Major’s day.
Today’s collective amnesia in SW1 can be attributed to two causes. The first is staff churn: our civil service moves people on after short stints. This benefits retention but hampers both corporate memory and subject matter expertise.
The second cause is a strategic embarrassment. Old audits generated red tape lists whose remedy was defined in official parlance as “Out of Scope” simply by EU membership. Government policy was continuing EU membership, so into the filing cabinets they went.
Then there are those anti-Brexit corporate lobbies. Excessive EU red tape partially exists because businesses and special interest groups lobbied Whitehall and Parliament. Even for those who opposed regulation, their selfinterest, having absorbed the costs, is for emerging competitors to choke on them too.
We today appreciate EU red cape costs because of the introduction – after considerable lobbying by Eurosceptics – of officially published Regulatory Impact Assessments (RIAs). Sometimes, these entered the realms of fiction, particularly any aetherial benefits from throwing the just-in-case Precautionary Principle against an industry. The Costs columns by contrast tended to be more robustly calculated, probably because they were evidenced by those doomed to pay them.
Together, these today produce timely reference points for reformers – provided you know where to dig and what search terms to use. One particular example that’s in the public domain should inspire MPs. In 2011, DEFRA published an initial departmental Cost-Benefit analysis of red tape and of its origins. Ministers were looking for quick wins for the Red Tape Challenge, a programme operating across Whitehall to find regulatory efficiency savings. These findings were updated in 2015.
So what did DEFRA’s last-known audit find? The updated review covered 428 sets of regulations, of which no less than 53 per cent (227) were derived from the EU or international legislation.
The direct cost to businesses of all regulatory burdens was estimated at £5,771 million a year. The estimated direct benefit was £2,065m per annum, meaning a net cost £3,706m. An astonishing 79 per cent of the total costs were associated with EU (plus a few international agreements, though those too would have been implemented via the EU).
We even know where the sectoral emphasis lies. The key sectors affected were listed as Fisheries and Forest (19 per cent), manufacturing (21 per cent), and water (35 per cent). Business costs were 86 per cent made up of policy costs and 14 per cent in admin. Eleven regulations with burdens estimated at over £100m a year accounted for 62 per cent of costs.
If you dig deeper, the direct benefits estimates look suspicious. One inventive “benefit” is a figure of £276 million a year arising from potential subsidies. Guestimates are made of economic gains arising from an assumption of improved public health reducing sick leave. A billion a year of biodiversity benefits are somehow arrived at from enhancements to sites of special scientific interest.
The costs to British industry, consumer and environment alike, of the Common Fisheries Policy are ducked. But for all those failings, which imply end red tape benefits could be much higher, the collective analysis bequeaths a massive head start.
Overall, what the review generated was a horizon-scanning audit of where precisely the department’s regulatory burdens lay. It reviewed the regime (or area), listed the original EU regulation if at source, identified the transposing regulations, set out which other domestic regulations were affected, and estimated the individual consequential costs.
Thus DEFRA’s audit accidentally generated a priority target list for post-EU deregulation. By listing the associated legislation it enables auditors today to not just tackle EU red tape but also the scourge of departmental gold plating, where a super-cautious Whitehall added further burdens to cut chances of embarrassingly being taken to the Luxembourg Court and fined for non-compliance. Both types of overregulation need fixing – the ‘don’t do it’ and the ‘do it again but lighter’.
The lingering EU red tape knotweed thus exists. One review I’ve seen with my own eyes still doesn’t officially apparently exist. The problem was always finding them when the librarian keeps saying Shh!
Armed with such evidence, there is no excuse for ministers failing to deliver. Similar documents will sit in other departmental archives across Whitehall, assessments from desk officers putting on record their powerlessness before badly-drafted and poorly-conceived decisions made higher up in Brussels.
Right now, small numbers of earnest civil servants are beavering away at identifying and reassessing them. I am unconvinced these missionaries of necessary reform are getting the attentive support they deserve, across departments. If that’s so, it would prove an absurd management failure, since half the answer is already out there.
Without that priority and drive, divergence will only happen accidentally. Brexit’s simple reality will mean we dodge future EU costs. But bad old laws must be corrected or ditched, and massive historic opportunities embraced.
Meanwhile, over in Brussels, Commission officials in 557 obscure committees, closeted away with favoured lobbyists, are still drafting new laws. 150 Council working groups secretly barter over endless small print rolling along the conveyor belt. Some 2,500 pieces of new legislation keep being churned out of the Brussels sausage machine every year (depending how you count). And Britain and the EU, and more alarmingly Ulster and Britain, casually diverge.