Ministers to ramp up deregulation agenda with new 'One-in, Two-out' rule

The Government plans to ramp up the requirement on Whitehall departments to cut existing regulations if they propose introducing new ones that impose a financial burden on businesses.

The Department for Business, Innovation & Skills said the current ‘One-in, One-out’ rule would become the ‘One-in, Two-out’ rule from January 2013.

From that date, the cost burden of any new piece of regulation must be matched by savings of double that amount achieved through the scrapping or modifying of other regulations.

DBIS claimed that the net costs on business had already been reduced by almost £1bn since January 2011, with £4bn of ‘outs’ compared to just over £3bn of ‘ins’. 

The Department added that when developing a new regulatory or deregulatory proposal, each government department “must carry out an impact assessment”.

Each assessment, which will include an estimate of the likely cost to business, will be considered by the independent Regulatory Policy Committee.

The new ‘One-in, Two-out’ requirement will not apply to EU legislation, unless the latter has been converted into UK law in a way that goes beyond minimum EU requirements.

Business Minister Michael Fallon claimed that 'One-in, One-out’ had driven “a profound culture change” across government.

He said: “Departments are starting to see legislation as a last resort, not the default option. But every year businessmen and women still spend too much time and money complying with government regulations, when they should be developing and growing their businesses.

“That’s why we are upping the pace. Our new target will require radical thinking right across Whitehall. It will require policymakers to make tough choices, and to think hard about how to get government off the backs of hard-working and hard-pressed businesses.”

DBIS said that government departments’ overall performance incorporating the two rules would be published at the end of this Parliament.