Deregulation Bill

Neil Carmichael Excerpts

Monday 3rd February 2014 Commons Chamber

[Neil Carmichael (Stroud) (Con)]

It is a great pleasure to follow the hon. Member for Stoke-on-Trent North (Joan Walley), who chairs the Environmental Audit Committee of which I am a member. It is a great pleasure to operate under her chairmanship. None the less, I take issue with some of her comments about regulation, because of the issue of enforcement, which applies, for example, to our report on wildlife crime. It is a question not of more regulations but of better-quality regulations, which usually means fewer regulations. That is an area that we can continue to discuss in Committee.

This is a great Bill, so I will not support the reasoned amendment. If the Bill is successful, it will send out a signal that we will not tolerate regulation in excess. The Bill is important in the context of some of the other measures that the coalition has successfully passed. My right hon. Friend the Minister for Government Policy is right when he says that it is not the only thing that we have done. The Enterprise and Regulatory Reform Act 2013 deals well with regulatory change, because it reduces it in the main, and we can celebrate that. [Interruption.] I know that the hon. Member for Hartlepool (Mr Wright) will agree with me on that.

[Neil Parish (Tiverton and Honiton) (Con)]

Does my hon. Friend agree that European legislation comes into Whitehall and is embellished and made even more vigorous, adding to the red tape? Though a combination of going back to the European legislation in the first place, and abolishing much of the embellishment, we can free up our businesses to work in a more competitive manner.

[Neil Carmichael]

My hon. Friend makes a good point. He puts his finger on one of the big problems that we have had for generations—since we joined the European Union—which is gold-plating. We must be bold enough to admit that and rigorous enough to remove it where it is inappropriate. People often misunderstand regulations from the European Union. We should be thinking about the spirit of them and not necessarily the precise detail.

The Bill proposes measures on purely domestic matters, which is not surprising because a huge amount of unnecessary legislation has stacked up over the years, as we can see if we look through the various clauses of the Bill. Before my hon. Friend intervened, I was trying to set out the case that the coalition Government have achieved a lot. I was going to move on to the abolition of quangos and so forth, because they too bear a huge burden of responsibility when it comes to excessive interference and regulation. We must not overlook that fact. I compliment the Government on the actions they have taken thus far to reduce the number and scope of quangos.

My second point relates to the speech of my hon. Friend the Member for Witham (Priti Patel). On one matter she was precisely wrong: of course, Essex is not the only place where small businesses thrive. Gloucestershire is another place—more precisely Stroud valleys and vale. Wherever I go in my constituency, small businesses are concerned about the perceived or actual burden of regulation, so they need that succour that encourages them to think that there is a way through and a way forward. Many of the specific issues that I discuss with small and medium-sized businesses crop up in this Bill. I am not surprised that matters such as employment, health and safety and so forth are covered. I will say a few words about specific clauses shortly.

Of course we want to remove regulation where it should be removed, and we need to refine it where it should be refined; but some regulation is necessary and we must accept that. Anyone who looks at the disastrous decisions of the previous Government leading up to the banking crisis will know that good regulation of financial services is necessary. We should say so, and we should ensure that such regulations are effective and transparent and can evolve through time. Changing circumstances demand that, and that is another theme that runs through the Bill.

Let us take as an example a regulation that I have just discovered, which hampers the Secretary of State’s approval of the use of fuels for domestic burning. At a time when we are looking for more sources of energy and worrying about our supply of it, it is absurd to have such an unnecessary hurdle in the way of new technologies, however small. It seems to me that the first test of regulation should be that it can reflect changing technology and new innovations. The regulations on fuel and fireplaces need to be ripped up and I am glad that is part of the Bill. They illustrate an important point about regulations, which is that they can become far too restrictive.

I also came across another regulation that I had no idea existed. If someone wants to be a driving instructor and happens to be disabled, they have to go through a separate licensing system. There are two big problems with that. First, it is discriminatory, and, secondly, it is simply monstrously unnecessary. Why should that be a regulation? Obviously, it should not and it is absolutely right that the Bill will remove it.

Another classic has to be the regulation that prevents railway companies from extending rail beyond 25 miles. When was that regulation introduced? In the Transport Act 1968. Things have changed and we need to start to recognise that changes such as those we have seen in the rail industry must be dealt with commensurately through the removal of unnecessary regulations.

Another great regulation that is to be removed concerns the role of the Secretary of State for Education and the office of the chief executive of skills funding. It is quite right that that office should be removed because it is effectively an unnecessary quango that removes the transparency and accountability that there should be around the decisions of and issues to do with the Skills Funding Agency. It is right that we give more power to the Secretary of State and not have such a structure standing in the way of effective progress.

In my constituency I always talk about promoting apprenticeships, which MPs of all political complexions want to do. I have been asked how reimbursement takes place and have had meetings with businesses through colleges. One thing they want to know is whether their cash-flow situation will be eased if appropriate, so I certainly welcome the changes to apprenticeship schemes.

I will not go through all the regulations covered by the Bill, but I particularly salute the change to the growth duty. It makes huge sense to encourage all regulators—in fact, all agencies involved in government—to think hard about how their measures relate to economic growth, because that is our central requirement right now. Economic growth is coming along and various sectors, including manufacturing, are doing quite well but they do not want to be hampered by unnecessary interference and regulation. We need instead to have confidence in the people involved in such industries. If one theme runs through the Bill, it is that we should trust people. That is emblematic of various measures passed by the Government since 2010, and the Bill brings all that work together.

In conclusion, let me reinforce the point that the Bill is part of a wider story of our deregulating and improving delivery in government, often by standing back from various sectors. It is also about trusting people and ensuring that we give them a sense of accountability and transparency. We must do all that with a clear mind about what we want to achieve: a free economy that can thrive and develop while taking account of and benefiting from changes in technology, modern ways of doing things and so on. We cannot rely on the Transport Act 1968 and such measures indefinitely.

I welcome the Bill. This exercise is a little like cleaning out the attic every now and again; it should be done frequently, as we get clutter. It seems to me that such an exercise would be a good thing to do virtually every Parliament.

--- Later in debate ---

[Neil Carmichael]

I have not had time to flick through every clause in the Bill, but who was in power in 2004 when the regulations on the management of child trust funds were introduced, and who was in power in 2003—this is a choice example—when we were legislating on the provision of late-night refreshment?

[John Mann]

As the hon. Gentleman said, he has not had time to read the Bill, which is why I itemised, for the record, every clause and schedule that removes Tory legislation. In fact, around 80% of the legislation being removed is Tory legislation. Indeed, when the Minister without Portfolio, the right hon. and learned Member for Rushcliffe (Mr Clarke), responds, he will doubtless wish to outline which bits he introduced in his various ministerial guises. Given his ministerial longevity, there will undoubtedly be several regulations that he was personally responsible for but now wishes to remove, and we on the Opposition Benches might wish to back him on that.

However, the Minister for Government Policy, a highly educated and learned gentleman, did not, when receiving his challenge on self-employment and safety, know what he was talking about. I cited, in relation to clause 1, what would happen with a self-employed mountain guide. He immediately jumped in to assist his hon. Friend the Member for Macclesfield (David Rutley), who was struggling, because he knew that I was right and that the clause represents an undoing of the self-employed mountain guide’s employment position. There is a critical flaw in the logic of the Bill. Mountain guides require insurance, and to get it they need to demonstrate that there is a health and safety profile, and that is relevant for those who employ self-employed mountain guides who take people out on ropes. By the way, I personally managed to negotiate, on behalf of the all-party group on mountaineering, exemption from the working at heights directive anomalies that affected that profession, demonstrating that the way the industry works meant it was not safe to put that application into place. I am not, therefore, on the side of unnecessary regulation, but the protection of the employment position of those self-employed people is fundamental.

A better-known example, the single biggest civil litigation case brought by a group of workers against a Government, demonstrates the issue more brutally. That common-law action brought by workers in the mining industry, for chronic obstructive pulmonary disease and Vibration White Finger, cost the Government a huge amount of money, because the people involved were employed primarily by the Government, so it was a taxpayer liability, although there were some private companies. The civil action was successful because the litigators had demonstrated that appropriate practices and procedures were not in place. If there had been proper regulation of the mining industry at the time, the cost to the health of the men forced to bring the case would have been hugely reduced, as would the financial cost to the taxpayer and other employers, which went into many billions.

That is the point of good regulation. A good health and safety procedure—for example on use of breathing equipment in a colliery or the handling of vibrating tools—would have been a mitigating factor in those processes, and a huge mitigating factor in terms of compensation. That is precisely why self-employed mountain guides require a structure within which they can get insurance and quantify it, to take them out of the provisions of the Health and Safety at Work, etc. Act 1974. What we are doing is leading to a lawyers’ paradise in which the agency that might employ people, and the individual, will be able to battle between one another over who is liable, if it can be demonstrated in court that particular procedures were not followed. A requirement of responsibility under health and safety law gives protection to that self-employed person as well as to the agency employing them.

Let me tell the House why I know that. When I ran a small business—as I did for many years—we had to deal with working at heights and a range of legislation, and I shall illustrate my point with some examples. A case was brought against us by an employee who had broken his foot. However, because of manual handling at work legislation and the fact that we had applied it, the case got nowhere. That was precisely because the legislation had created a structure with a sensible and rational procedure, which we could demonstrate and insist that the employee followed. When he did not follow that procedure, we could demonstrate that as the employer—with liability—we were not in fact liable for the accident.

It is a myth that good regulation damages small business. I lived with regulation day in, day out, and if we ask small businesses, we find that they nearly always object to two things: paperwork—that is always a nightmare—and cost. When small businesses complain—and when I did—it is about cost. If regulation costs a lot and someone is trying to make ends meet, it is difficult. However, regulations on manual handling at work, and health and safety legislation, do not involve cost other than training the work force. It is a miniscule cost. It is an absurdity when someone is handling heavy goods, as we were, not to have such regulation. Let me give a second example.