01 February 2013

VP Šefčovič: "Regulatory burden - Why Europe needs to get smarter to do better"

Regulation is a vital part of the European 'project' - ensuring a level playing field from which everyone can benefit. Indeed, in many areas, EU regulation is more effective than a patchwork of national regulations: this is true for instance for the Single Market, consumer protection, financial regulation, environmental protection or economic governance...

The economic crisis has, naturally, focused our minds even more on the need to generate jobs and stimulate economic development and on the urgency of putting in place the Europe 2020 reforms. Smart Regulation is part of this. We need to reinvigorate and strengthen our efforts to reduce regulatory burden. That is what REFIT is all about – to review, to reinvigorate and to refit if necessary.

We commit to mapping and reviewing our entire acquis – all of our regulations – to systematically identify regulatory burdens and transparently launch initiatives that will result in significant regulatory cost reduction and simplification. We will look across sectors – in other words, reviewing EU regulations from the perspective of the end user – to identify all the layers of overlap and duplication that lead to additional and unnecessary costs for the business community. And we do not have the luxury of time: this mapping and scoping will be completed by mid-year so that actions can be taken.

Reducing the burden of existing regulation is our focus. But at the same time we will continue with our rigorous impact assessment to make sure that any new legislation does not add to the burden either. We will continue to strengthen our impact assessment system, honing our techniques to assess costs and benefits, as well as providing short summary overviews and revising our guidelines.

Moreover, we will ensure that all of this is done transparently. We have a system in place that allows stakeholders to share their views on the likely effect of new legislative proposals through consultations. Over the last three years, we have held more than 300 of these consultations via the 'Your voice in Europe' website. The response has been largely positive, but there are still improvements to be made: consultations do not always ask the right questions at the right time and sometimes fail to reach those directly affected who cannot always be addressed in their native languages.

To extend the reach of consultations, the Commission will publish a rolling calendar of planned consultations on the website, as well as making better use of communication channels in the Member States and using more innovative consultation tools, among other methods. We've also extended the consultation period from 8 to 12 weeks to give stakeholders more time to react.

But we also need to focus on implementation. Of course, it is up to the Member States to implement, but we can do more to facilitate and support them, for example by working out support initiatives in advance, by providing platforms for exchange of best practice or by better assessing where problems of conformity with EU legislation arise...

Before I finish, I want to highlight one further point about Smart Regulation: it is a collective effort. I've focused today on the work of the Commission, as is natural, but we are by no means alone in wanting to tackle this issue. The European Council and European Parliament have repeatedly called for more collective efforts to reduce the administrative burden, and national governments have made their own efforts to pursue a similar agenda with national legislation.

We can do more together. Let me give you an example: as I said at the beginning, we have met the target of a 25 per cent reduction in burden by 2012, but the Commission has in fact tabled proposals with a burden reduction potential closer to 33 per cent - that's around €41 billion in monetary terms.

However, some of this potential (estimated at more than €3 billion) was lost in the legislative process as the Commission proposals were amended by Parliament and Council. Furthermore, we are still awaiting the adoption by the legislators of pending proposals that could generate additional savings of €6.8 billion.

Nor do these figures take into account the fact that proposals from Brussels do not always make it onto the national statute books in the same form – some are 'gold-plated' by national legislators with country-specific add-ons. It is often these, rather than EU proposals, that contribute to the administrative burden.

Indeed, this problem of perception is one that persists among Member States. How often do we hear criticism of the 'Brussels bureaucracy', forcing regulation upon citizens and business, when the reality, as we all know, is that the Commission merely initiates proposals while the decisions are taken by the Council and by the European Parliament.

This is one the reasons why we encourage additional impact assessments on any substantial amendments to our proposals, and welcome in this regard the recent decision by the European Parliament to set up its own impact assessment unit.

In fact, the vast majority of legislation made in Brussels is done in the form of Directives which allow Member States to decide how to implement the policies in line with local circumstances. Regulations, which are directly applicable in Member States, are used only in fully harmonised areas such as in the area of agriculture which is a common policy. This can hardly be said to be 'Brussels' imposing its will!

Whatever the reason or the source, it's clear that there is unnecessary red-tape in EU legislation, and I hope I've shown that we are working hard to reduce it. But the blame for that red tape cannot be laid solely at the door of the Commission; nor can the Commission be expected to tackle it alone.

We need to work together, but in the most appropriate way. Many Member States are looking to reduce their own national burdens, often with great success: I could cite, for example, the amendment of 18 tax laws in 2012 that led to a massive €2.5 billion reduction in the overall burden on German businesses! But approaches [to] that work at the national level are not always appropriate at the EU level, where the process is more complicated, not least because EU Directives are implemented in a different way in each Member State. While we all share the same goals, we must be ready to give each other the freedom to reach them by whatever means are the most effective for us.

Full speech

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