03 June 2009

How regulation can both protect and serve

Getting tough on red tape, meeting tight efficiency targets, helping businesses through the recession, and protecting the consumer – it sounds like Mission Impossible. But, a round table debate organised in Birmingham by The MJ, the Local Better Regulation Office and the Society of Local Authority Chief Executives, heard upbeat assessments from those at the sharp end of enforcement. Chris Smith reports

From the mechanic in a backstreet garage to multibillion-pound supermarket giant Tesco, every business operator has to abide by laws to protect the public. And that means they will, at some point, come into contact with their council.
But the roundtable debate hosted jointly between the Local Better Regulation Office, the Society of Local Authority Chief Executives (SOLACE) and The MJ, held in Birmingham, found enforcement officers believe they can help firms and their communities come through the downturn.
How businesses see their current situation was summed up by one contributor: ‘It’s lonely on a Friday evening, looking at the bills coming in. A website doesn’t offer support.’
Most small businesses, battling to meet overheads and keep customers coming through their doors are not comfortable with regional development agencies or Business Link.
One specific solution raised, which is already gaining momentum among public sector IT managers, is ensuring struggling firms don’t struggle with excessive form-filling by ensuring they are only giving information once. A key question for chief executives is: ‘How does this sit with the rest of what I am trying to do?’ The answer is that regulation and enforcement have a very important role in managing key issues.
One example is the developing 24-hour economy which operates in most cities across the UK. Better working with other agencies can save money, and massively improve a community.
Regulating nightclub doormen, minicab firms and off-licensing can tackle under-age drinking, anti-social behaviour and violence, to turn around a late-night crime hotspot.
Creating a safe night out boosts regeneration, attracts new businesses and reduces expensive admissions to hospital A & E units. Loan sharking is clearly linked to financial exclusion and organised crime.
Enforcement officers can offer valuable intelligence to other agencies. ‘I know my patch, I know who the rogues are. What is my organisation and the others I work with going to do to help me?’ said one participant.
But there was a warning that the way forward would be mobilising resources, not ‘putting money into the pot’.
A further issue raised on enforcement is local sensitivities – raiding restaurants or penalising a minicab firm could hit people in Asian or Chinese communities.
Enforcement could also drive modernisation. Environmental health, housing and planning issues could develop a preventative fire service rather than one which reacts to put out fires. Spacial development should start with the premise that ‘you can’t have no-go areas.’
The main springboard was pinpointed as small-medium enterprises (SMEs), employees and the consumer. As one participant said: ‘The public are the ultimate regulator who get it right more often than they get credit for.’
There was also a call for greater clarity from central government. There is too much competition from Whitehall departments and statutory regulators, leading to ‘regulation in a fog’.
An example was how 15% of solicitors generate the majority of complaints to the Law Society which oversees their conduct.
The view was: ‘Regulation goes wrong when there’s a closed conversation, with something handed down from the regulator to the regulated.’
Accusations of red tape were tackled head on. The Food Standards Agency was created in 2000, when confidence in UK produce was the lowest in the EU following BSE and the foot-and-mouth outbreak.
Now, it is the highest in the EU.
But the big idea from this was moving to ‘intelligent-touch’ regulation – the right agency doing the right thing at the right time. A change in approach can also include understanding where a small firm sits in its business life cycle, to giving entrepreneurs the support they need. Some councils don’t even know how many businesses are in their area.
The rural recession has led some councils to change their focus to proactively follow intelligence.
On efficiency, officers were urged to reduce the amount of time spent allocating work and asking permission to take forward initiatives. ‘If you fall over, the organisation will pick you up. When people don’t fall over, you’ve got to worry,’ said one round table participant. But an admission came that some departments had been vaguely working on everything, and pretending it was happening.
There was also the admission that trading standards officers had ‘always felt deeply unloved’ by their authorities, and that their first line of defence when change came was, ‘Well, we’re different’, in the case of regulation is true.
Globalisation has also had an impact – dealing with a complaint involving a supermarket giant will be the council in which the head office is based, which creates an organisational headache.
The message from our panel was clear – enforcement is about far more than court orders and clipboards. Officers can help their communities survive the downturn.
But to help businesses large or small through the recession and protect consumers from ‘rogues’ in a tough budget climate, local authorities must help their teams by showing leadership from the top. And they must tackle the cultural challenge of their organisation, partners – and at national level.

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