Red Tape Committee and the words of Montesquieu

Montesquieu’s words from the 18th century – “les lois inutiles affaiblissent les lois nécessaires” – are often quoted in the modern context of the need to reduce “red tape”. That is, the idea of “useless laws weakening the necessary ones” is said to be an impact of too much red tape clutter in our laws that only serve to inhibit their proper application.

In that context, the Senate has established a Select Committee on Red Tape, to be known as the ‘Red Tape Committee’.

The committee is to inquire into the impact of “restrictions and prohibitions” on business (‘red tape’) on the economy and community, with particular reference to:

  1. the effects on compliance costs (in hours and money), economic output, employment and government revenue, with particular attention to industries such as mining, manufacturing, tourism and agriculture, and small business;
  2. any specific areas of red tape that are particularly burdensome, complex, redundant or duplicated across jurisdictions;
  3. the impact on health, safety and economic opportunity, particularly for the low-skilled and disadvantaged;
  4. the effectiveness of the government’s past efforts to reduce red tape;
  5. the adequacy of current institutional structures (such as Regulation Impact Statements required by the Office of Best Practice Regulation and red tape repeal days) for achieving genuine and permanent reductions to red tape;
  6. alternative institutional arrangements to reduce red tape, including providing subsidies or tax concessions to businesses to achieve outcomes currently achieved through regulation;
  7. how different jurisdictions in Australia and internationally have attempted to reduce red tape; and
  8. any related matters.

The committee is not due to report until 1 December 2017.

The Red tape Committee will no doubt be reviewing the activities on the existing Red Tape website on which the various departments report their ‘achievements’ in reducing red tape.

Other agencies’ efforts will also come under scrutiny for interesting ideas, the Baw Baw Shire Council offering some examples.

Overseas governments have a similar focus, with the UK’s Red Tape Challenge as one example.  It is an issue for all countries, relating to international competitiveness, with the UK recently supporting a similar focus in the Philippines.

Treasury Legislation Amendment (Repeal Day 2015) Bill 2016?

But red tape initiatives can get bound up in further red tape.

One ‘initiative’ coming from the politically announced ‘red tape repeal day’ in 2015 was the Treasury Legislation Amendment (Repeal Day 2015) Bill 2016. It was to, among other things, amend the Corporations Act 2001 to modify the notification and reporting obligations of receivers appointed to property of certain corporations, mainly in relation to existing s 428.

That Bill lapsed in April 2016 and is not on the current Bills agenda.

Act on law reform recommendations?

As I have written before, one way to keep control of red tape is to act upon law reforms recommendations that seek to improve the law. 

In my area of insolvency and related laws, various good law reform recommendations have been made to government over many years. There has been no or limited law reform in response to these reports, the last major reforms being pre-GFC, in 2007, with the Corporations Amendment (Insolvency) Bill 2007.

That does not stop the government establishing further inquiries, this Red Tape Committee being one.

Also as I have written about, the need to change “Court” to “court” in the Corporations Act – a typo – was identified in 2003.  It has had the impact of overburdening the Federal and Supreme Courts with minor claims.  Its correction is happening, but is part of the 2016 insolvency reforms, now delayed until 2017.

The Red Tape Committee can be contacted at:

Red Tape Committee
Department of the Senate
PO Box 6100
Canberra ACT 2600

Phone: +61 2 6277 3228
Fax: +61 2 6277 5829

Good luck all.


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