My honourable friend the Minister for Business and Regulatory Reform (Ian Lucas) has today made the following Statement.
The Government have today published a report on the Benefit-Cost Ratio of New Regulations Introduced in the Financial Year 2008-09.
The report shows that the benefits of new regulations enacted in the last financial year outweighed the costs by £9 billion, at a ratio of nearly 2 to 1 and confirms the Government's commitment to strengthening regulatory management.
The figures, published as part of a new benefit-cost ratio, showed that overall quantifiable benefits exceeded costs by about 80 per cent, meaning that government regulation is expected to deliver £1.85 in yearly benefits for every £1 of cost, or a ratio of 1.85 to 1. The publication of the ratio, covering the 2008-09 legislative programme, is a world first and will be published annually in the future.
The Pensions Act 2008, aimed at enabling and encouraging more people to build up a private pension income to supplement the money received from their basic state pension, is an exceptional piece of legislation, with the highest benefits and costs in 2008-09, which has a significant effect on the overall ratio. If removed from the ratio, the benefit to cost ratio would increase to 4 to 1.
The benefit-cost ratio is drawn from the detailed assessments of the impact of new regulation produced by government departments and regulators. All departments and regulators that introduce new regulation that has a significant cost or benefit must produce a full impact assessment which is published in an online library.
The Government are fully committed to ensuring that all new regulation is justified and proportionate and that the benefits outweigh the costs. It builds on commitments to increase transparency and accountability, following on from the publication of the Government's regulatory programme.
Regulation provides essential protections to employees, employers and citizens. Striking the right balance between costs and benefits is vital to make sure the regulatory framework is fit for the 21st century.
A copy of the report is being placed in the Libraries of the House.