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The compliance burden – is it really all that bad?

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It’s a truism that small businesses – in fact, businesses small, medium and large, are struggling under the weight of government-generated bureaucracy. On a regular basis, opposition parties (all right, then, the Tories), and business bodies complain about the “burden of compliance”, and blame the Blair Government for its existence; Tom Blass Editor of sister site BusinessZone presents his views.


But is this true? Playing devil’s advocate briefly, are all the pieces of paper pointless and incomprehensible or do they make life easier, or at least give us something we enjoy moaning about?

At the end of last week, the British Chambers of Commerce (BCC) published the results of a business school study that claimed that since coming to power New Labour (as it was once known) had imposed 46 pieces of legislation totalling a £40 billion “compliance burden” for business.

The greatest offender – or at least, that piece of legislation that cost the most, appears to be the 1999 implementation of the Working Time Regulations, which doubtless some readers will deride as unnecessary Euro-trash.

But surely, any civilised nation worth its own weight in mandarins needs fire precautions, employment relations, biocidal products regulations (whatever they are, they cost us – or “you, the taxpayer”, £140m), pollution laws etc.? And it cannot be every business that is, however indirectly, burdened by the Processed Animal Proteins Regulations 2001.

Doubtless websites like our own are part to blame. We like a good grumble (and a good headline) as much as the next site. But a random telephone poll of subscribers suggests that the consensus is that all these groups have invented a “Behemoth of bureaucracy” to suit their own purposes, and that far from having their human rights infringed by tortuous form-filling obligations, life is actually becoming less of a burden.

One FD said, “to be quite honest, I think things are easier. A lot of the time I can do things online. And where I do have to fill in another form, it’s usually quite simple and doesn’t take very long.”

Another said, bluntly, “filling in forms is what we have to do anyway. I don’t blame Tony Blair for it. I think that a lot of time the ‘burden of compliance thing’ is just headline grabbing for the sake of it.”

Contacted by AccountingWEB, the BCC promised that a policy bod would call back and address these issues. He hasn’t yet. He’s almost certainly ploughing his way through some guidelines.

But a spokesman for the Institute of Directors(IoD)told me that “there’s no dispute there’s been a growth [in the compliance burden], and that SMEs are disproportionately affected.”

He pointed out that actually sitting down to read 112 pages of guidance notes on the minimum wage could take the best part of two days – and that, in theory at least, someone in the company is obliged to do it.

It’s a fair cop. But everyone knows that no-one is going to read the bloody thing anyway. Don’t they?

Notwithstanding all this, a policy paper released by the IoD last year, “Red Tape Case Studies – in their own words” is pretty grim. Though arguably, it isn’t as chilling as an Amnesty International document, and if Blair is going to face the International Criminal Court for crimes against humanity, it won’t be because of the impact on business of redtape. One anonymous contributor, for example, recalls the trauma of someone going on maternity leave:

“Recently one of the two clerical staff took six months’ maternity leave. Her temporary replacement proved to be limited in ability, leading to the full burden of our clerical work falling on the senior administrator. Developmental work was put on hold.”

It makes painful reading. As does:

“As a result of the Data Protection Act, accident books that are required by the HSE have been replaced to ensure confidentiality of the individual’s details recorded on the book, by the use of tear-off pages. This was badly publicised and caused considerable work in determining the new requirement. We would question the need for this, as the new process is more complex, particularly at the data retrieval or inspection stage. Furthermore, we already have a process that is more comprehensive and adds more value than the accident book process. However, we still have to maintain accident books in addition to comply with HSE requirements.”

And:

We spent £14,000 last year having an electrical inspection to ensure that we met EEC standards. We now have to spend more money to comply. This means in effect throwing out perfectly good equipment only installed 15 years ago to the then current standards.

Perhaps I’m making light of these issues unduly. But mothers will have babies and want to look after them and bureaucrats will make laws and businesspeople will complain that those laws are hindering competition and that paying people a living wage is crippling their business.

In a sense, everyone is just acting out their given roles. Do not all governments pass laws, many of which are ill-designed, stupid, and in some cases despotic? And do not all opposition parties promise that when their turn comes, they will listen to business, pass laws against passing laws, slash bureaucracy and turn complacent civil servants out into the street where they belong?

Putting more people in prison and keeping immigrants out is another sure fire way to get a few votes.

But at least now we know where the real culprits lie: Brussels – that grey hotbed of anonymous and unaccountable eurocrats who have but one aim: to keep our sprouts the right size and force us out of business.

Does this get Blair off the hook?

Let me know what you think.



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Annie Hayes

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