Flagging a drive to cut unnecessary costs due to regulation, the Australian Chamber of Commerce and Industry estimates red tape costs the nation's industry $86 billion a year.
Flagging a drive to cut unnecessary costs due to regulation, the Australian Chamber of Commerce and Industry estimates red tape costs the nation's industry $86 billion a year.
The ACCI has launched a program it believes will make life easier for business and reduce costs for consumers, making government more accountable for the regulations that constrain industry.
Statement by Mr Peter Hendy, Chief Executive
The Australian Chamber of Commerce and Industry (ACCI) Australia's largest and most
representative business organisation, has today launched a position paper Holding Back the Red
Tape Avalanche, which outlines a plan to reduce the impact of the escalating volume of antibusiness
regulation.
Based on international economic research, ACCI estimates regulation costs the Australian
economy approximately $86.0 billion per year or 10.2 per cent of GDP.
Amongst the biggest losers from anti-business regulation are consumers who are inevitably forced
to pay higher prices as compliance costs get passed through to end products and services.
The most effective way to relieve the impact of regulation does not necessarily involve a radical
overhaul of the current system. Instead what is needed is far greater vigilance on the part of
government to enforce the checks and balances that are currently part of the regulatory structure.
ACCI's model for regulatory reform specifically deals with initiatives that should be carried out
by the Australian Government. However the principles can and should be adopted at all levels of
government.
Our model is built on achieving clear political accountability, making the system more transparent
and subjecting all proposed regulation to straightforward cost benefit assessments.
The specific features of the ACCI approach are as follows:
1) The Prime Minister will table in Parliament an annual regulatory budget that provides a
cost and benefit analysis of all business-related regulations. Measuring the cost of
regulation is the first step in controlling its growth;
2) All regulatory budgets delivered by the Prime Minister must be placed on a centralised
website. This will help to inform the public of the amount of regulation being created and
the amount of regulation it is required to comply with;
3) The Office of Regulatory Review will be moved from the Productivity Commission to the
Department of the Prime Minister and Cabinet. The new body, to be known as the Prime
Minister's Regulatory Reform Unit (PMRRU), will be headed by a Chief Executive chosen
from the business community;
4) A modeling unit located in the Productivity Commission will be created to develop a
standardised costing tool to be applied to all new regulatory proposals. Line departments
will be required to apply this costing tool to objectively measure the compliance costs of
their regulatory bids; and
5) Regulation that does not pass the Regulatory Impact Statement (RIS) process as
determined by the PMRRU will not be allowed to proceed.