Review of regulatory guidance should have offered a lifeline rather than a helpline

Review of regulatory guidance should have offered a lifeline rather than a helpline, say business groups

The FPB (Forum of Private Business) and ACCA (the Association of Chartered Certified Accountants) are disappointed by the recommendations of the review of regulatory guidance led by Sarah Anderson CBE.

Professor Robin Jarvis, head of SME Affairs at ACCA, said: Uncertainty about regulation holds people back from starting up in business and creating new jobs. Quality guidance was a necessity even during better times, and it is absolutely crucial now.

The FPB and ACCA share the Reviewís conviction that the Government should avoid legal disclaimers and stand by its own guidance. But the two bodies, which together represent tens of thousands of small businesses and their advisers in the UK, are concerned that the Reviewís plan for an insured helpline takes publicly-funded business support in the wrong direction.

Without an ongoing relationship and understanding of the business, ëinsuredí advice is no safe haven. Implementation is where the risk arises, and businesses are still on their own there, said Phil Orford, Chief Executive of the FPB. We wonít achieve certainty in regulation by duplicating work that is done adequately by the private sector. Certainty will have to come from producing better regulation and more helpful, consistent guidance in the first place.

The two business groups point instead to a mostly overlooked recommendation from the Review - re-skilling regulatory inspectors as industry generalists - as a bright spot in the review.

Inspectors and other enforcers of regulation have always had the potential to look at the bigger picture as part of their enforcement duties. This could be a step towards finally using them efficiently, added Mr Orford.

Finally, ACCA and the FPB see the Anderson Review as an opportunity to strengthen the Governmentís commitment to regulatory reform, the sharp end of which depends, crucially, on effective guidance:

Prof. Jarvis explained: The bar is set too low when it comes to guidance. Last year, a government survey found that businesses were spending 40% less on employment red tape than in 2005. All of these savings were attributed to a programme of government guidance – even though no single part of it was used by more than 9% of businesses.

Both organisations hope that, in the post-Anderson world, the task of improving guidance will be taken more seriously.