Verheugen bids to slash red-tape burden by 2012

Günter Verheugen, the European commissioner for enterprise and industry, will next week launch a bid to cut the burden of red tape for businesses by 25% by 2012.

He will also announce the setting up of a panel of experts to monitor the quality of impact assessments, in response to criticism that the Commission is currently playing judge and jury.

In a paper to be presented to MEPs in Strasbourg after adoption by the Commission next Tuesday (14 November), he aims to give renewed impetus to the Commission’s efforts to cut the burden of red tape, which have produced disappointing results so far.

The strategic review of better regulation says that the Commission will ask EU leaders to agree at their summit in March 2007 on a common way of calculating the administrative cost of complying with legislation at both EU and national level and to cut it by 25% by 2012.

The Commission estimates that a reduction in red tape can produce a one-off boost to economic growth of €150 billion or 1.5% of gross domestic product.

Member states will be encouraged to adopt a better regulation strategy if they do not have one (currently only 19 do). Only nine have programmes to simplify legislation, according to the Commission paper.

A representative of the European business federation UNICE welcomed the decision to set a target for cutting red tape. Erik Berggren, UNICE’s policy adviser on better regulation, said: "A fixed threshold will focus attention because it’s not just about good intentions. It’s about delivering." But he called for interim dates for making progress rather than just the 2012 deadline. Otherwise it could be too late to see that the target was not being met, he said.

The paper will also announce that the Commission is to set up an impact assessment board composed of high-level officials responsible for ensuring the quality of assessments, reporting to President José Manuel Barroso. The board may also draw on external experts.

Although the Commission has paid more attention to evaluating the cost of legislation on businesses, it has been criticised because initial impact assessments are carried out by the same officials who are drafting new laws.

Berggren welcomed the Commission’s intention to bring "more independence and objectivity" into impact assessments. But he expressed concern about how independent the review panel would be.

The plan will win the full backing of German Chancellor Angela Merkel. She has endorsed the 25% target and has made better regulation a priority for Germany’s presidency of the EU starting next January. In an interview this week she said that the presidency would be about ‘de-bureaucratisation’.

The Commission’s paper presents a mixed picture of progress so far: 68 out-of-date proposals have been withdrawn with ten to follow in 2007, while around half of a planned 100 initiatives to simplify legislation are expected to be adopted by the end of this year. The Commission wants 20 of those remaining to be dealt with as priorities.

Efforts at codification, bringing together regulations and later amendments in a consolidated text, have been less successful. Of the 500 actions planned by the Commission, only 85 have been drawn up and just 52 have been adopted.

Lack of progress in scrapping outdated or superfluous legislation and simplifying or consolidating existing laws prompted Verheugen to criticise senior Commission officials in early October, accusing some of obstructing efforts to cut red tape.

The paper says that it will focus on ensuring that member states implement EU legislation properly and do not add to the administrative burden when transposing European rules. To address this problem, the Commission will ask member states to provide ‘correlation tables’, setting out how their national laws correspond to the original EU legislation.

Günter Verheugen, the European commissioner for enterprise and industry, will next week launch a bid to cut the burden of red tape for businesses by 25% by 2012.

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