Between the lines: Blitz on red tape requires more than lip service

By JIM EAGLES

It's a good first step. But what really matters is what happens further down the trail.

That, in essence, has to be the verdict on the Government package on reducing business compliance costs released yesterday.

It is enormously encouraging that the Government has acknowledged the desirability of freeing New Zealand's entrepreneurs from unnecessary rules and charges so they can get on with the business of creating jobs and earning wealth for the nation.

The process of setting up a Ministerial Panel on Business Compliance Costs, publishing the panel's excellent report and issuing a point-by-point response is entirely praiseworthy.

So, too, is the fact that all legislative proposals now carry a statement indicating the compliance costs they might impose.

At the least, this exercise should give a cabinet, whose members have little experience or understanding of what it is like to run a business, a much greater awareness of the impact that ill-thought-out regulations can have.

But it is far from clear what the practical consequences of the report will be.

The Government's response to the 162 recommendations in it is impressive in size but unexciting in what it has delivered.

For instance, when it comes to the Resource Management Act, probably the greatest source of business discontent and a major obstacle to development, the signs are not good. The Government's latest proposals, although an improvement on its previous thinking, will still result in an even more obstructive law than exists now.

Similarly, on the tax system, the RMA's main rival as a source of frustration, the Government is offering little that is concrete.

Of 18 recommendations, eight have been rejected, six agreed in part and only four accepted in their entirety - and they involve further study.

There are certainly positive signs on occupational safety and health, another area of business concern.

The Government has agreed to pick up suggestions for voluntary codes of compliance and measures to ensure a more consistent approach by OSH inspectors.

But when it comes to the planned toughening and tightening of OSH legislation, which enraged business when it was tabled a few weeks ago, the Government can offer only the prospect of reasonable submissions being given due consideration during the select committee process.

And that, in essence, sums up the whole exercise.

The Government is giving away little in the way of the specifics that will make it easier to run a business.

What is being offered is a series of processes, further studies and attitudinal changes which, if followed through, should bring progressive improvements over the next few years.

Will it work? Will the procedural steps aimed at making the Government more conscious of any negative effect its policies will have on business really overcome its socialistic instincts?

Time will tell. One useful indication of whether business concerns can ever outweigh Labour policy will come from the outcome of the select committee hearings on the Occupational Health and Safety in Employment Amendment Bill next year.

Another even more important test will be the compliance costs associated with Labour's election policies.