Written by Anthea McIntyre, MEP for West Midlands
No legislator, or regulator, should make rules for their own sake. To make setting-up or running a company more costly or time-consuming not only damages European companies and European competitiveness, it damages people’s career prospects and prosperity.
We should be clear, lighter regulation should not mean making work less safe. Clearly though, if regulation is simple and easy to implement compliance will rise and safety will increase. Furthermore, a clear and consistent regulatory framework has benefits for companies in providing a predictable environment for businesses to operate. It is the un-clear, over bureaucratic areas of regulation which need to be addressed.
Here in Brussels, the new Commission structure has clearly put a strong emphasis on better regulation. At his Hearing in the Parliament on 7th October, Frans Timmermans was very clear in setting out the importance he attaches to better regulation. He said; “My first task is to make sure that every commissioner carries out better regulation… we will be able to reduce legislation where it’s not necessary…”
With SMEs responsible for 85% of newly created jobs and representing 67% of all private sector employment in the EU, how regulation impacts on them is important for the wider economy. Often, SMEs are also an essential element in the supply chain for larger companies. Yet it is SMEs who are often hardest hit when complying with regulations as they do not have the HR, legal and other specialised employees which at the disposal of larger firms.
A 25% reduction of the administrative burden on SMEs could lead to a 1.4% growth in the EU’s GDP. Simpler, better regulation has a huge potential in making Europe more competitive, more prosperous with more in employment.
In the EU, it currently takes between 4 and 40 days to start a company – our goal should be to set up a company in 48hours. This is a commitment in the Small Business Act and is one of the recommendations in a Report I took through the Employment Committee earlier this year which was passed by the Parliament on 15th April.
The Report has sections on, among others, access to finance and better regulation. It also refers to the recent trend in some parts of the EU of companies re-shoring production and services back to Europe. The In the UK, one in six manufacturers have brought jobs back in the last three years. In some cases this is because of lead times or increased labour costs. If we could provide a better, clearer, more efficient regulatory environment in the EU, our businesses would be more competitive globally and perhaps more jobs would return to Europe as a result.
If better Regulation can play a part in boosting the EU’s GDP, make compliance easier and work safer, and encourage more off-shored jobs to back to Europe, we have to try. I believe it will make such a positive impact. I plan to spend the next five years doing what I can to help.