Government proposals slash compliance costs

Businesses compliance costs will be reduced by a quarter by 2010 if government proposals to set regulatory budgets for each central government department are successful.

Under a new scheme announced by the Department for Business, Enterprise and Regulatory Reform (BERR), government departments will need to look at ways they can reduce the cost of previous regulation to businesses in order to bring in new regulation.

The plan intends to reduce businesses' reliance on consultancies by issuing them free best practice on compliance.

For example, IT will be provided with new government advice on computer system automation, according to a BERR spokesman, who said the programme would be the first of its kind in the world.

"If the UK is to remain a respected place to do business, we must not expect business simply to absorb the costs of a stream of new Government initiatives," said Secretary of State for Business, John Hutton.

"This innovative approach will build on efforts already in place to cut the burden to business by 25 per cent by 2010."

The only exception to the cost cutting of regulation would be that of climate change. Regulation concerning the environment will remain uncapped, according to a BERR statement.

The government consultation on the new budgets is now underway. The commitment to consult on the new system of budgets was first announced as part of the Enterprise Strategy, launched alongside the Budget, earlier this year. Under the new proposals budgets will be set and agreed later this year.

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