After the referendum: deregulation on steroids

14th July 2016 / United Kingdom
After the referendum: deregulation on steroids

By New Economics Foundation – Regulations place limits on what businesses are allowed to do – the level of noxious fumes that cars are allowed to emit, the notice that must be given to an employee before making them redundant, and what can or cannot be put into our food.

It’s good for us and for the environment, but often comes at a cost to business profits.

Following Brexit, the pressure to lift some of these protections is going to intensify – we must unite and defend them.

Successive British governments have been extremely fond of deregulation, but the current government has extended and heightened this long tradition of weakening regulatory protections for workers and the environment. Brexit doesn’t change these underlying motives, but it unleashes new deregulatory possibilities that could push the agenda further and faster.

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The UK is already one of the most deregulated rich countries in the world. Yet we still have a whole set of rules that ensure we continually deregulate even further.

For example, the civil service operates a ‘One In, Three Out’ policy: if a government department wants to implement a new policy that will cost businesses £1 to comply with, then they have to repeal other legislation worth £3, regardless of the costs or benefits to the environment or society at large. This means that the stock of eligible regulation must, by definition, get smaller over time.

Until now EU regulations have been exempt from this rule, but as soon as our EU membership is cancelled whole swathes of our laws will come under the self-destructing tendency of ‘One In, Three Out’. That’s just one example of how deregulation is hard-wired into the British legislative system. Others include a fast-track process for deregulatory policies and a committee of businessmen that supervise the government’s estimates of cost to business.

Brexit has been the perfect excuse for politicians to undertake extreme reforms that they wouldn’t have otherwise got away with (see Osborne’s proposed slashing of corporation tax). But it’s not just that our new political leaders will want to deregulate our economy – they will have to because that’s the rules.

Some trade campaigners might be relieved that Brexit could mean the end of Britain’s inclusion in the Transatlantic Trade and Investment Partnership (TTIP) – a trade deal with the potential to force countries to reduce regulatory standards.

This could well be a good thing, but even if international deregulatory threats disappear (which is unlikely), the domestic threats are now more severe than ever. There’s no time for complacency.

So here’s what we need to do. First, build awareness that Brexit doesn’t just expose specific regulatory protections, but systematically endangers a whole raft of laws that will get queued up for the automatic shredder of ‘One In, Three Out’ and other deregulatory rules.

Second, and most importantly, we need to start fighting back. There’s not really been any organised and coherent resistance to the deregulation crusade, which equally threatens social, animal welfare, environmental, and public health outcomes.

That has to change, starting now: Brexit risks putting rocket-boosters under the “war on red tape”, and that’s bad news for us all.

 

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