Endless form-filling makes Government few friends

By KEVIN TAYLOR

Filling in forms for the Government and dealing with an array of red tape is a complaint never far from the lips of business people.

The Business Herald's unscientific survey ("Everyone wants to break free" - C9) of people from firms big and small again reinforces how highly compliance costs rate as a concern.

The issue is a particular worry for small businesses, which do not have the resources to devote to the avalanche of paper.

That is to say nothing of the concerns held by business lobby groups about impending law changes - in workplace health and safety, for example - that they say will just add to compliance costs.

Some small businesses are said to be ignoring regulations - breaking the law in the process - because they do not want to comply, are unable to comply, or simply do not know how to comply.

A major Business Roundtable report last year detailed the amount of regulation and legislation that Governments generate .

Author Bryce Wilkinson says in the report, Constraining Government Regulation, that over the last two decades an average of about 4000 pages of statues and legislation have been passed each year.

While obviously not all of those rules affect business, many of them do, and the report argues that small businesses cannot knowingly follow all the rules.

It calls for a review and reform of Government regulations, and lists stories of excesses in the areas of tax, employment, workplace safety and resource management.

The areas the report cites are similar to those singled out by business people as being problems.

Tax and ACC were specifically mentioned by some small businesses in the Business Herald survey as being especially difficult areas to comply with in terms of complexity, time and cost.

The Government has made an attempt to tackle the issue.

In late 2000, the Labour-Alliance Coalition appointed a panel of business people headed by McDonald's New Zealand managing director Al Dunn to thoroughly examine compliance costs.

The panel reported back last July with a detailed list of 162 recommendations.

The Government responded last December. Commerce Minister Paul Swain said the Government was committed to trimming red tape as part of a culture change in the bureaucracy.

The Government said it agreed in whole, in part or in principle with 139 of the 162 recommendations, which urged changes in areas ranging from labour laws to tax regulations.

But individual business people and lobby groups continue to be concerned.

Swain told the Business Herald just after the Budget that the Government would put out a report card this year on its work responding to the 162 recommendations. That report will come after the election.

He maintains that it will show the Government delivering on about 90 per cent of the panel's recommendations.

Meanwhile, the business-friendly National and Act parties have promised swift action on compliance costs.

National wants to study compliance exemptions for companies below a certain size.

It would also establish a ministerial commission to review within six months all laws creating costs for business, and recommend changes it wants pushed through by the end of next year.

The party also wants to:

* Reintroduce competition for workplace accident insurance.

* Introduce a regulatory responsibility law that will require every new regulation to pass a test that asks whether it will do more harm than good.

* Change the Employment Relations Act so much that the Council of Trade Unions has described the party's proposals as the [now-repealed] Employment Contracts Act in drag.

Act's policy is to review all existing regulations and introduce a Regulatory Responsibility Act to ensure that all new regulations promise benefits that outweigh the costs.

The party believes compliance-costly laws on accident compensation, employment relations, occupational safety and health and the Resource Management Act need rewriting.

But with Labour polling so strongly, businesses are pinning little hope on a change of Government.

Labour's problem is convincing business it has done anything of substance on compliance costs. Despite Swain's messages, many businesses appear to have noticed no difference.

While every party promises solutions to the issue, businesses continue to wait for some sign that the red tape is really being trimmed.

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