23 January 2013

By David Whyte

The foundations of today's deregulation nightmare were laid by Labour

For years, Labour’s front-benchers have sounded further to the right than Milton Friedman on this issue. When the red-tape busting Legislative and Regulatory Reform Act was passed in 2006, Labour ministers like Jim Murphy promised it would “cut the burden of regulation” and “embed a light-touch” approach to regulation. The CBI and the Institute of Directors couldn’t believe their luck. Now in an apparent volte-face, Mary Creagh on the Labour front bench is blaming “cuts and deregulation” for a “chaotic system with fewer checks".

It was under Labour, of course, that the FSA was established, and it was under the Coalition that the FSA was stripped of its powers to regulate the contents of the food we buy. Yet the FSA has never had the principle role of co-ordinating enforcement, or of ensuring compliance with food standards. This responsibility has always rested with local authorities. And it was under the last government that local authority food hygiene and food standards inspections fell by a third.

Even worse trends were experienced in other areas of protective regulation. Workplace inspections fell by two thirds, and inspections of businesses by Environment Agency fell by the same rate. Of course, things have worsened considerably under the Coalition, but the foundations for the current “cuts and deregulation” that senior Labour figures now complain about, were laid by their colleagues.

No matter how hypocritical the rhetoric, a promise to reverse damage done to our systems of regulation is both welcome and long over-due. But Labour now must spell out exactly how it plans to undo the work of the Blair and Brown governments and protect us from, rather than expose us to, the greed of business.