The Minister for the Cabinet Office and Chancellor of the Duchy of Lancaster (Lord Macdonald of Tradeston): My Lords, the UK is one of the leading EU member states in trying to improve the European regulatory environment. The survey reported in the internal market scoreboard is one of a number and covers only a narrow range of firms. Figures show that the UK is the largest recipient of inward investment in Europe and several other studies by the OECD, Arthur Andersen and the Economist Intelligence Unit show it to have one of the most lightly regulated of the world's economies.
Baroness Miller of Hendon: My Lords, I thank the Minister for that Answer. Does he remember that when the Government took office in 1997 they pledged themselves to reduce red tape and regulation? Can he therefore explain to the House how it is that during their first term in Parliament the Government introduced more than 14,000 new regulationsa record-breaking numberand an extra burden on businesses of more than £15 billion; and how during that period we slipped from 9th to 19th in the global competitive league, according to the highly respected International Institute for Management Development?
Lord Macdonald of Tradeston: My Lords, I question the total of 14,000. It has been alleged by the Opposition party that 3,500 new regulations have been introduced in the past year, but that figure confuses the number of statutory instruments with the number of regulations on business. The number of statutory instruments introduced each year has ranged from 3,200 to slightly under 3,500 during the last decade. More than 95 per cent of those SIs have no impact on business and many have a local or temporary effectfor example, road traffic orders. I should point out that, despite the assertions made about the state of our economy, it has been said by Digby Jones of the CBI that low interest rates, low inflation and low unemployment make us the most successful economy in western Europe.
Lord Macdonald of Tradeston: My Lords, my noble friend asked me whether I recall the quote. I do indeedwith some relish. We are making good progress inside the European Union through the Mandelkern Group, which has been working to harmonise the regulatory environment across the EU. In that, it is taking its lead in many matters from the precedent that we have set in Britain.
Lord Razzall: My Lords, will the Minister allow me to give him an even softer ball than the one given to him by his colleague? Does he agree that the previous government imposed a significant element of business regulation on this country which manufacturing industry, in particular, still regrets? Having given him that soft ball, which I am sure he will serve with his normal prowess, does he also accept that it is about time that Her Majesty's Government indicated when they will make the bonfire of regulations that they promised in their election manifesto?
Lord Macdonald of Tradeston: My Lords, let me list for the noble Lord's benefit the number of initiatives that we have taken. We have, for instance, strengthened the Regulatory Impact Unit; we have brought in an enforcement concordat which has allowed business to work more closely with local government; we have mandated regulatory impact assessments, as noble Lords will know through dealing with the legislation in the House; and we have a ministerial panel for regulatory accountability. The Regulatory Reform Act has been passed and has produced regulatory reform orders. The first orderwhich, the House will be pleased to hear, extended New Year drinkingwas passed in December. We anticipate that there may be 50 to 100 of these fast-track regulatory reform orders in prospect. We also have regulatory reform action plans, which we anticipate publishing shortly, which include about 300 measures. In addition, of course, we have set up a small business service to ensure that the interests of business are served in the regulatory sphere.
Lord Macdonald of Tradeston: My Lords, I am not sure that I fully understand the question, and for that I apologise. As I said, we have been working with other countries in the EU on the Mandelkern Group. We strongly support its final report, which sets out a series of recommendations. It was brought before the Laeken summit in December and will be taken forward to Barcelona in March. We are also trying to improve our record on the transposing of EU single market directives. We have fallen very slightly behind other countries in transposing European law into British law. I regret that we have not been quite as zealous as was the party opposite in that respect. We have therefore gone down the league table a little as regards imposing European regulation in Britain.
Lord Willoughby de Broke: My Lords, if, as they say, the Government have been so helpful to business, and to small business in particular, will the Minister explain the position? He did not answer the main point put to him by my noble friend Lady Miller. If the Government have been so helpful to business, how has this country slipped from 9th to 19th in the world competitiveness league?
Lord Macdonald of Tradeston: My Lords, the quotes from the CBI indicated, in its words, that this country presently has the most successful economy in western Europe. Deloitte & Touche expressed the view that the UK will escape a recession proper, and that it is the best-performing country in the G7. Those are not quotes attracted by an under-performing economy. The Economist Intelligence Unit found that, rated against 70 factors, including flexibility of the labour market and openness to foreign investment, the UK ranked third among the 60 largest economies in the world according to how good they are to do business in. Arthur Andersen's ranked the UK first for its policy towards private enterprise and competition. Those are both recent reports.
Lord Macdonald of Tradeston: My Lords, I believe that I can safely assure the noble Lord that devolved administrations are free to make their own decisions within their competences without intervention from central government.
Lord Macdonald of Tradeston: My Lords, if the First Minister in Scotland was looking over his shoulder, I think it was to ensure that continuing support was still in sight. We should all be pleased at the remarkably seamless transition during devolution since 1999. It is all too easy to lose sight of the magnitude of what we have achieved. I can say from personal experience as a Minister that we have had a remarkably affable and effective relationship with the devolved administrations. I cannot answer the more detailed question on the Sewel amendments. I shall make inquiries and write to the noble Duke.
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