Dangers of rules that always put safety first

First published in the Financial Times on 27th May 2014.

Perhaps regulations, forms and inspectors all make life easier and happier. But I doubt it

Red tape is the disease that only ever gets worse: but we seem to tolerate its endless creep as if it were a natural phenomenon, like the weather. Why is this?

Its increase is partly a result of risk aversion and avoidance of blame: there is a growing inability to tolerate any mistake, injury, wrongdoing or abnormality. Everywhere from playgrounds to building sites to factories, we are more afraid of accidents, more squeamish, more timid. Bureaucrats imagine the worst that can happen.

All this fear is exacerbated by litigation. Local government or businesses dealing with the public suffer ever higher liability insurance premiums, and rafts of claims. These undermine trust and mean more small print, more permits and more pedantry.

Technology empowers administrators. Big data permits them to collect ever more information, and monitor citizens with ever greater scrutiny – thanks to CCTV, telecom and online records, credit card use and all the rest. Because the welfare state feels obliged to carry out tasks that families or local communities used to do, there must be rules and supervision, since organisations cannot behave in the same flexible and informal way that friends can. Political correctness is also a big driver of regulation – both serious and petty. Despite talk of localism, a tendency towards concentration of power at the centre is endemic in most organisations. Companies are larger than they used to be, and industries more consolidated. This leads to more layers of management, more processes, more rigidity.

Perhaps regulations, forms and inspectors all make life safer and happier. But somehow I doubt it. More often they manufacture tedium, waste resources, distract from real priorities, value procedure over substance and foster a mentality of box ticking rather than self-reliance. Frequently, all sense of proportion is lost and any sense of adventure suffocated, because there is always someone who forbids any new idea. Automation means jobs have disappeared, but many have been replaced by departments such as compliance. Hence the efficiencies of progress have been lost by armies of functionaries busy creating empires.

Britain builds half as many new homes as required. This shuts out millions from property ownership. An antiquated planning system and rampant nimbyism inhibit and delay construction, and hugely increase property costs.

Steve Morgan, chief executive of housebuilder Redrow, explained last year that the company had built several hundred houses on a site in the northwest a few years ago, on which it incurred nine planning consent conditions. A nearby site was recommended recently for approval, but this time with 103 conditions. I am surprised big projects ever get off the ground: many die because their sponsors lack superhuman perseverance.

My experience at the Institute of Cancer Research has proved to me that drugs take too long after discovery to reach patients. A typical development cycle can be 15 years or more, and involve hundreds of millions of dollars in trial costs. This delay and expense cannot be in society’s wider interest. Much of this is bureaucratic paranoia brought about by rare, historic tragedies such as Thalidomide.

The British government has tried in recent years to tackle the red tape virus by abolishing “outdated, burdensome or overcomplicated” regulations under its Red Tape Challenge. It has achieved successes in areas such as employment law. But deregulation is fiendishly difficult. Many rules are well intentioned and appear harmless. Meanwhile vested interests defend their sinecures. India has a magazine called Bureaucracy Today, which claims a readership that is in charge of 70 per cent of the country’s GDP. I think it is one of the most depressing publications I’ve ever seen. I wish Narendra Modi, India’s new prime minister, good luck in reforming that aspect of Indian culture – for which the British are partly responsible.

A vibrant nation should promote innovation and reward risk takers. Red tape strangles such initiatives. During prosperous peacetime, the enemy comes from within: as the novelist Mary McCarthy wrote: “Bureaucracy, the rule of no one, has become the modern form of despotism.”