Dialogue: Less talk, more action needed

The Compliance Costs report highlights the need for employers and Government to work together for the good of the country. By ALAN DUNN*.

The report by the Ministerial Panel on Business Compliance Costs is the business sector's best chance of getting its voice heard and workable solutions implemented.

This is because the report represents the views of New Zealand business, not the interpretation of politicians or officials on what they think are the views of business. The report outlines compliance cost issues that business people themselves have identified and makes several practical and workable recommendations aimed at reducing the burden of such costs.

The Ministers of Commerce and Finance, Paul Swain and Michael Cullen, took a significant risk in inviting this approach. The panel members are not regulatory experts, or experts in the many legislative areas we explored. And we are not politicians with any commitment to policy positions. We do, however, know business and have an understanding of how the Government functions.

Our responsibility was to find out what business is thinking, encapsulate the views in this report, and bring forward solutions that business believes will work and that, hopefully, the Government will find acceptable, affordable and realistic.

We were concerned to discover the high number of business people who said that compliance costs stifle their ability to expand, innovate and compete. This reinforced to us the message that reducing compliance costs will really result in more competitive businesses.

Businesses, without exception, supported the need for regulation, especially in health and safety, working conditions, environmental quality, equal opportunity, consumer protection, product standards and competitive safeguards.

However, while businesses were keen for the objectives of such legislation to be realised, they wished to see this done in a more efficient and effective way. In researching this report, the panel met central and local Government officials to help us understand the issues and problems they face in carrying out legislative measures. It is clear there are problems on all sides.

There are around 260,000 businesses in New Zealand and about 220,000 of them employ five or fewer staff. Meeting the compliance needs of this group is therefore vital to the success of our economy.

These are the businesses that have limited internal resources and can least afford outside expertise to deal with a situation where, as many passionately put it, they feel they are being swamped by a sea of paperwork, regulatory requirements and legislative changes.

We have a theme running through our report of seeking to get rid of the punishment mentality which often sees some organisations, Government departments and local authorities unable to give clear and useful advice on how to comply, but seemingly having little difficulty in levying penalties for non-compliance.

So we want to see a change in attitude that fosters incentives, not punishments.

We embrace a future that will see co-ordination, cooperation, sound advice and the sharing of ideas - all freely available on the internet through the e-government and e-commerce initiatives.

Businesses want online access to case studies, step-by-step guidelines, plain English explanations of legislative changes, and online transactions with the Government. The one-stop-shop electronic portal should include internet and phone access. The Government should consider providing incentives to small businesses to install, use and maintain up-to-date online technology.

Further gains could be made through improved consultation processes, more cooperation between agencies, greater questioning about the need for regulation, carefully prepared laws and better information and guides for businesses to enable them to comply more easily.

There are 162 recommendations in our report covering tax, the Resource Management Act, ACC, OSH, the Employment Relations Act and many more.

While we were encouraged by the positive responses from the Government and officials, we believe that the Government, in its broadest sense, must make a quantum leap. And not just the Government of the day. This report is aimed at all policy makers.

Compliance cost issues have remained virtually unchanged throughout the 1990s. It is our view that major changes are needed now. Many business people we spoke to felt that the time for talking was over and that the time for action had arrived.

A positive response by the Government must, in turn, be met by an equally responsible attitude from the business community. Business has a key role to play in the success of an improved compliance cost environment.

Any moves by the Government to act on the concerns and recommendations raised in this report must be supported by businesses who need to be prepared to spend the time understanding Government initiatives and using any assistance provided. We encourage all parties concerned to work together to ensure positive outcomes.

* Alan Dunn is chairman of the Ministerial Panel on Business Compliance Costs and chief executive and managing director of McDonald's New Zealand.

Links


The full Business Compliance report