Letter from Patricia Hewitt MP, Minister
for Small Business and E-Commerce, Department of Trade and Industry
to the Chairman of Sub-Committee B
Thank you for your letter of 19 January 2000
which dealt with The Government's response to the Sub-Committee's
Report on Promoting Small and Medium Enterprises in the EU.
I am pleased that the Sub-Committee concluded
that on most points the Government and the Sub-Committee share
an understanding of the opportunities and challenges facing SMEs
and how Government can act in providing an environment which will
allow SMEs to prosper.
In response to the issues you raise directly,
I should wish to make the following points.
As I stated in my letter of 13 January, I see
no clear case for the establishment of a European Small Business
Agency. I see business support as an issue primarily for Member
States to pursue, much as we are doing in the UK through the creation
of the SBS. Nevertheless, it is vital that the interests of small
firms continue to be promoted at the European level and to this
end the Government is working hard for agreement at the Lisbon
European Council for a Small Firms Charter. The aim of the Small
Firms Charter is to produce within the EU a world-beating environment
and capability for entrepreneurs and small firms through enhancing
the regulatory framework and encouraging innovation and job creation
My response of 19 January failed to reassure
you on the issue of "gold-plating". I rather think there
is less between us on this issue than may be apparent. The Government
sees better regulationminimising unnecessary burdens on
businessas a key element of its policy towards SMEs. In
certain instances going further than the minimum required by a
directive may lead to the improvement of regulations and it therefore
makes sense to proceed in that way. Whenever we do this, we look
for clear justification and require demonstrable evidence that
the benefits can outweigh the costs. We would therefore not wish
to simply rule out such action as a matter of principle. Each
case is dealt with on its merits, but we would only allow it in
the small number of cases where it is properly justified.
Regarding the Sub-Committee's recommendation
that when gold-plating occurs it should be clearly marked as such,
the Government is currently revising its Better Regulation Guide
which will provide an opportunity to see how this might be addressed.
I note that the Sub-Committee is still considering
whether to investigate further one or more of the topics in the
report and look forward to hearing whether I can continue to be
of assistance in your consideration of the issues.
18 February 2000