The Confederation of Danish Industry (DI) regards simpler regulation as one of the core elements in achieving a more competitive Europe by ensuring and strengthening the growth in European businesses.
The current EU agenda, called "Better Regulation" is set to terminate by the end of 2012. After 2012 however the agenda is shifting from better to "Smarter Regulation". The change of semantics should however not change the focus. Whether the agenda is about better or smarter regulation the pupose of the effort should always be to maximise the use of productive resources.
Calculations from both the Dutch and Danish Ministry of Business indicates that the european economy can reap significant returns by cutting administrative burdens. Both ministries specify that if administrative burdens are cut by for example EUR 1 billion, GDP will increase by EUR 1,4 billion in the long run. The significant positive effect better regulation has on GDP is due to the reorganisation of productive resources.
Since 2001 the Danish government has achieved cuting administrative burdens by 25 percent. By and large the reduction of administrative burdens has freed up till 19.000 employees in the private sector. Employees who are now occupied by tasks concerning the core business of the companies.
As the importance of EU legislation on national regulation continuously increases, it is of significant importance that smarter regulation is at the heart of both national and EU legislators.
Smarter regulation is especially important to the SMEs
As SMEs and entrepreneurs do not have the same administrative resources (e.g. ERP) as larger enterprises, simplification is especially important to them. A study shows that, divided by the number of employees, burdens are almost double the amount at enterprises with ten or less employees than at enterprises with more than ten employees.
Smarter regulation reduces the administrative burdens imposed on the businesses and hence strengthens the competitiveness of the businesses. Furthermore, smarter regulation is a tool to achieve a more efficient public administration. For these reasons DI supports the process of ensuring smarter regulation at national and EU level.
The methods to achieve the goals of better regulation are:
- Standardised measurement of the administrative burdens (Standard Cost Model - SCM)
- Binding targets to reduce administrative burdens
- Simplification of regulations
- Implementation of ICT (eGovernment)