Brexit, regulation and scrutiny

By Frances Powrie March 29, 2017 1:43 pm

When the Daily Telegraph splashed with a campaign to “sweep aside thousands of needless EU regulations after Brexit,” it highlighted two very important points. The first was the scale of the job facing Whitehall. The second was the potential for EU regulations to be removed from British statute books without the levels of parliamentary scrutiny we’ve come to expect.

And the latter is a scenario that any organisation needs to be very mindful of.

What we know is that now Theresa May has triggered Article 50 and formally announced the UK will be leaving the EU, there will be a Great Repeal Bill in the Queen’s Speech (to be held in May). This legislation will be perhaps the most misleadingly named of recent times. Rather than simply cutting EU regulations, the plans is to ‘lift and shift’ – transposing them into British law.

There are good reasons for doing so, as it’ll ensure legal certainty and consistency when Britain does leave the EU. Put simply, the world won’t change overnight. Then, civil servants can give consideration to what regulations are overly onerous and what should be retained. Meanwhile, there’ll be up to 15 additional Bills brought before Parliament across areas including agriculture, immigration and customs rules, focusing on areas where there is an urgent need to have new policies in place before we leave.

The Daily Telegraph is right that the opportunity exists for a ‘burning of red tape.’ The question is whether this will be given the level of scrutiny it deserves.

Politico has previously highlighted that Whitehall officials face having to review more than 500 regulations a day in order to clear a backlog in the two year negotiation period. And this could be made possible by the “untrammelled power” (according to the Financial Times) that would be afforded to ministers and officials during the Brexit process, due to the likely use of delegated powers to make changes across a range of policy areas. This would not come with the same level of scrutiny as primary legislation, so while ministers might not have carte blanche, it would be as close to it as our political system allows.

So, yes, the opportunity to cut red tape certainly does exist. But the question is what approach is needed. And the answer is one using a scalpel rather than a scythe.

Whether you agree or disagree with the decision to leave the EU, one of the fundamental arguments made by leavers was the opportunity to reassert UK control over its laws. But that doesn’t necessitate scything cuts but rather the opportunity to exert judgement on what regulations are onerous and unnecessary, and what are actually quite helpful to British businesses, associations and charities.

What this means for organisations of any size is that they need to be engaged with policymakers, officials and parliamentarians to understand the process by which EU regulations will be reviewed, the timescales involved, and Whitehall’s approach to retaining or dispensing existing laws that have emanated from Brussels.

Many sectors that will remain reliant on trade with Europe over the long term will be keen to avoid regulatory divergence that prevents them from selling products within the Single Market. They will want, at least in the short-term, UK law and regulations to align with those of the EU. The pharmaceutical industry, as just one example, will want to ensure there’s an equivalent to the European Medicines Authority. But there are host of industries – from financial services to medical devices – where EU regulations, even when considered less than ideal, are important in enabling trade.

There are two lessons to take from the imminent Great Repeal Bill. The first is that wholesale scrapping of EU regulations is not necessarily to be welcomed. The second is that businesses, associations and charities must understand and engage with the process. Otherwise they risk ending up with an environment less conducive to their activities. And engaging with policy makers to the best extent means following some basic principles.

  • With the sheer volume of regulation to work through, it will be important to work with other organisations within the sector to agree key priorities – whether for deregulation or ensuring continuity
  • Understanding where regulatory changes may go unchallenged and be vigilant
  • Being clear on the ‘red lines’ that must be defended, but willing to work positively with government to identify solutions as well as problems

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