Regulation of Business, and Water, and Water Energy and Telecoms

The UK has left the European Union. We have regained sovereign control over our laws, borders and money. For the first time in half a century, we have the freedom to conceive and implement rules that put the UK first. This means that now is the time to think boldly about how we regulate in order to modernise our approach, unlock cutting-edge technologies, ease burdens and cut red tape, and boost competition.

In July 2021 I jointly launched the consultation on “Reforming the framework for better regulation”, to capitalise on the regulatory freedoms provided by leaving the European Union. In the consultation I set out that the Government are committed to a regulatory system that is smart, proportionate and considers the needs of business. The system Government use to manage the flow of regulation and understand its impacts is key to delivering this commitment and plays an important role in helping to drive behaviour and approaches to policy making across government.

An overwhelming majority of responses to the consultation welcomed some degree of reform. A full summary of responses to the consultation will be published today, alongside the Government’s policy document, “The Benefits of Brexit”.

Our proposed reforms to the framework for better regulation are underpinned by four core policy changes, which aim to improve and control the flow of regulation across government, and assess its value:

Adopting a greater emphasis on proportionality, to ensure that we regulate in a way that focuses on allowing businesses to grow, while giving greater flexibility to try innovative new approaches.

Ensuring that we are making the best use of alternatives to regulation by introducing an earlier scrutiny point at which departments will be asked to justify their decision to regulate.

Improving how we evaluate regulation, including post-implementation reviews.

Improving how we measure the overall impact of regulation, including consideration of a more holistic approach and the removal of the Business Impact Target (BIT) in its current form.

While these reforms represent a streamlining of process and a change of emphasis, they do not undermine or reduce the requirements for Departments to produce options appraisals and quantified impacts in accordance with the Green Book.

The reforms proposed to the framework for better regulation will not take place at once. There will be a transitional year, with one final BIT report, while we bring forward legislation to make changes to the Small Business, Enterprise and Employment Act 2015. BEIS will use that time to agree with Departments the details of metrics, targets and exemptions.

Alongside these reforms, today I will publish a policy paper on the future of economic regulation of water, energy, and telecoms within the UK. This follows a commitment in the National Infrastructure Strategy for Government to produce an overarching policy paper in this area.