Published Wednesday 11th March 2020
Rishi Sunak will rise to deliver his first budget today in the most challenging circumstances; Corvid19 will have a potentially inestimable effect on the broad economy and with a persistent budget deficit, sclerotic growth and a range of ‘Red Wall’ spending commitments his room for manoeuvre is limited.
Perhaps then, he could assist businesses – particularly in financial and professional services by taking an axe to red tape.
As the Bank of England’s chief economist Andy Haldene has pointed out – in 1980 there was one regulator for every 11,000 people employed in finance. By 2011 there was one for every 300. And just think about the employment growth in finance over that period.
Every law firm and financial services company groans under the weight of ever increasing compliance – regulation is not wrong in itself, but if it discourages innovation or worse still prevents competition then surely it’s the Treasury’s role to challenge it.
The Institute for Economic Affairs suggests that regulation costs the UK economy between 10-12% of GDP. Imagine if just a third of that cost and effort, particularly to mid-market and smaller firms could be redirected to revenue generating activity or process improvement?
Given the challenges the Treasury faces (and I haven’t even mentioned Brexit) then today would be a good day to light a bonfire.
About the Author: Jason Adderley, joined ERA after a 15-year career in the commercial property development and investment industry, and works with a diverse client base comprising solicitors, actuaries, chambers, patent attorneys, accountants, surveyors, consulting engineers and recruitment consultants.
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