By Alex Jackman - 2 November 2012
Michael Heseltine delivered his much anticipated review earlier this week into growth.
There are 89 recommendations in the 260 page report, with many focused on structural changes to government and the way it interacts with business, from the big, right down to the small.
The report highlights a lack of engagement from Government with the vast majority of businesses that are not high achievers, noting a significant lack of formal structures in which such a dialogue can take place.
He says what is needed is a coordinated private sector support structure. This we agree with – it’s what we do. But where we disagree with Mr Heseltine is the way he proposes this be achieved, with a major focus on Government and other providers, such as LEPS, working solely with the various Chambers of Commerce as delivery partners.
It is even mooted in the report that there should be compulsory membership of the Chambers and their status should be enshrined in legislation.
Heseltine does not feel this would necessarily be detrimental to other national business bodies. This would be one the more fundamental and controversial proposals in the report for Government to take forward, and we have already come out against it. As have others. For Government to tamper in a private market this way is more than a little worrying. It should be down to businesses to make an informed choice about the type of support they want.
Heseltine does, however, contradict himself. He puts forward in the report an argument – rightly so – that regulation impedes growth. He recommends the Government write to industry asking exactly how wording should change on existing regulations in order to better support business and growth.
The Red Tape Challenge has sought to do this over the past two years with some success. This new deregulatory measure would put trade bodies in the position of drafting legislation which affects their members.
We don’t think this is practical. Too many conflicts of interest and not enough impartiality. Instead our argument remains one of consistency and clarity in terms of new regulations, with new ones introduced only when completely necessary and then sympathetically enforced.