Red tape crackdown saves business £1.9 billion?

According to the latest report from the Department for Business, the red tape burden on British business has been reduced by 14% since 2005, equivalent to a £1.9 billion saving a year in time and money.

The figures are the latest to be released by the Better Regulation Executive which has managed cross-governmental action.  It aims to ensure all departments are focused on simplifying existing regulations and reducing the burden of compliance by 25% by 2010.

Stephen Carter, minister of regulatory reform, said:

… smart regulation can play a vital role in creating a better economic environment for business now and in the future.

One example quoted is the move to provide more employment law advice online which is purportedly saving business £400 million year.  This is a staggering cost saving and does run counter to anecdotal evidence from small businesses in particular in relation to the burden of employment legislation.

The Chartered Institute of Personnel and Development, while welcoming the latest findings and any reduction in the legislative burden of compliance on business, was a little bemused by the online savings, saying:

It’s hard to know what caused the reductions mentioned in the report, but it seems to us that the online guidance for employers has made only a modest contribution to the recorded reduction in cost.

Any reduction in the financial and administrative burden of legislation on business large and small is good news.  The government has clearly played its part, but there may be other influences at work here too.  Perhaps something for further investigation.

[Picture credit: unk’s dump truck licenced from Flickr]