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UK Welcomes European Council Agreement to Cut Red Tape for Business

The European Council has today agreed to follow the UK's lead and reduce red tape arising from EU law by 25%.

Hilary Armstrong, Minister for the Cabinet Office, hailed the move as a crucial step towards improving the competitiveness of European business and a win for the UK.

At their meeting in Brussels, EU Heads of Government agreed a target to reduce administrative burdens by 25% by 2012, in 13 policy areas, including Company Law, Health and Safety and Transport, which have been identified by the European Commission as imposing the largest administrative burdens on business.

It is estimated by the Commission that this initiative could benefit European businesses by €150 billion (£100 billion). Hilary Armstrong said:

‘Red tape is both costly and irritating for business, particularly SMEs. In a globalised economy, we have to get rid of unnecessary bureaucracy if we are to compete successfully. The UK set a target last December to cut administrative burdens by 25%. The EU has now followed suit. This EU agreement will reduce some of the biggest burdens, so that businesses can spend less time filling in forms and more time concentrating on improving their competitive position.’

John Cridland, Deputy Director–General of the CBI, said:

‘With so much of the regulatory burden facing UK businesses stemming from Brussels, this commitment is very welcome. It is now vital that these proposals have full impact on the Commission and Parliament in practice.

‘The UK's target to reduce red tape by 25% has already started to focus civil servants' minds on the need to lighten the regulatory load, and to shift ingrained attitudes towards risk and regulation.’

This initiative forms part of a wider commitment to regulatory reform by the European Commission, under the leadership of President Jose–Manuel Barroso and Vice–President Gunther Verheugen. The Commission has also put in place guidelines for the production of integrated impact assessments for new legislative proposals and embarked on a rolling programme to simplify existing EU rules, containing over 140 specific proposals.

Notes to editors

1. The European Commission's Action Programme for Reducing Administrative Burdens in the European Union of 24 January 2007 can be found at http://ec.europa.eu/enterprise/regulation/better_regulation/index_en.htm [External website].
2. The Commission, working with the Member States, is to undertake an exercise to measure the administrative burdens arising from EU legislation in 13 priority policy areas. These are: Company Law; Pharmaceutical Legislation; Working Environment/Employment Relations; Tax Law (VAT); Statistics; Agriculture and Agricultural Subsidies; Food Safety; Transport; Fisheries; Financial Services; Environment; Cohesion Policy; and Public Procurement.
3. The measurement work is due to run until the end of 2008 and the Commission is expected to make firm proposals to reduce administrative burdens at the meeting of the European Council in March 2009. The work will involve attributing costs to the information obligations placed on business by EU legislation, based on the number of businesses affected and the time spent complying.
4. In parallel, the Commission will be taking fast–track action to reduce administrative burdens relating to ten pieces of EU legislation in the areas of Company Law, Agriculture, Statistics, Transport and Food Hygiene. The first three proposals were adopted by the Commission on 7 March 2007.
5. The Government has embarked on a domestic programme to reduce unnecessary administrative burdens. On 11 December 2006, the Government announced plans to reduce red tape in the UK by 25% by 2010, which would save business and the third sector £2 billion.
6. The Better Regulation Commission, the independent body which advises the UK government on reducing red tape, has voiced it's support for the European Commission's Programme, in a joint paper published with the Dutch Advisory Board on Administrative Burdens and the Nationaler Normenkontrollrat of Germany. Details can be found at http://www.brc.gov.uk/ [External website]

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