Lindsay Tisch MP National Party Small Business Spokesman

21 August 2003

Small business stalked by 'regulatory creep'

"New Zealand's small to medium sized businesses are being stalked by regulatory creep," according to the National Party spokesman for Small Business, Lindsay Tisch.

"The problem is urgent, New Zealand must tackle the real cause of regulatory creep - the incentives on Government and its institutions to regulate.

"There are more than quarter of a million small to medium sized businesses in the country employing nearly 600,000 people - they need our help.

"The Auckland Chamber of Commerce estimates that even a business with no employees spends 172 hours on red tape, while those with up to 20 staff spend 26 hours per worker cutting through the red tape.

"Compliance costs are estimated to have increased by more than $40,000 and the Government is threatening more to come with a return to its trade union roots.

"It's food for thought that when someone's convicted of careless driving resulting in injury or death, they're subject to a maximum fine of $4,500 - yet a boss who gets sued for stress could face fines of up to $250,000.

"We do not get rid of paper work by passing more laws; sometimes the Government passes laws as symbolic public action rather than as practical solutions to real problems.

"We need bold innovative strategies which create a culture that encourages public servants to reduce regulation, and get it right first time.

"That may involve a flexible rule that says for every new regulation a number of existing regulations would have to be repealed.

"This kind of programme would see regulations used to solve problems, with public servants spending more time weighing up the costs and benefits of any new legislation.

"The current bias towards regulation would be reversed, the size of the public sector would diminish, compliance costs would shrink and the tax burden would follow suit," says Mr Tisch. Ends

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