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What do the Netherlands want in Europe?
Many administrative burdens have their origin in Community legislation. The Dutch reduction exercise is therefore also focused on this kind of legislation, because companies situated in the Netherlands have to deal with European legislation.
The Dutch Cabinet advocates, since its EU Presidency of 2004, an approach to tackle European red tape (i.e. administrative costs). The goal is to introduce a European red tape approach in Brussels, which is similar to the Dutch approach, i.e. an approach of targeting, measuring and reducing unnecessary administrative costs.
A European approach towards red tape makes it actually possible to deal with unnecessary red tape and to simplify European legislation. That is necessary, because the results from Brussels are modest so far.
The Dutch Cabinet foresees simplification potential in e.g. the following European domains: construction, agriculture, waste, financial services, statistics, labelling and motor vehicles.
What are the results so far?
The Dutch efforts are focused on both the existing body of Community legislation and on new Community legislation.
Existing EU legislation
The Netherlands are actively working together with like-minded countries, the European Commission and the European Parliament to design and implement a European red tape approach, which is focused on the modernisation of the existing body of Community. Nowadays the topic is high on the European agenda. In Spring 2006 the European Commission announced an ambitious measurement exercise based on the Dutch approach. This project could form the new start of the existing EU simplification program. Commissioner Verheugen, who is leading the project, considers in this context a reduction target of 25 percent. This kind of a reduction would stimulate the European economy with € 75 billion, Verheugen calculated. For the Netherlands this would imply a reduction of about € 2 billion. This EU project falls in line with the invitation from the June 2006 European Council. Quantitative targets are highly effective as they create a sense of urgency and help realise results on time. See this document
The Netherlands consider it crucially important that Brussels develops a European red tape approach - similar to that of the Netherlands - to fight unnecessary red tape stemming from European legislation. The Dutch finance minister Gerrit Zalm and the Danish economy minister Bendt Bendtsen highlighted this by a joint letter which was published in the Financial Times. See Financial Times
New EU legislation
It is important to make sure that new Community legislation does not contain unnecessary administrative costs. Therefore policy makers should pay attention to this aspect in the legislative process when legislation is being developed. The Dutch model (the so called standard cost model) to measure administrative cost is a helpful tool in this context. It calculates the administrative consequences of policy options. This makes it a valuable tool in the decision-making process.
In 2005 the Commission tested, validated and presented a model for estimating administrative costs resulting from new EU legislation. This EU model is based on the Dutch model. The EU model is now used by the European Commission in the European Regulatory Impact Assessment. The RIA is carried out for new legislation and calculates the social, economic (including administrative costs) and environmental effects of a legislative proposal. Since 2006 also the administrative costs are part of the RIA. This focuses attention increasingly on the administrative burdens new EU proposals cause.
Measuring and targeting are not goals in it selves, but tools to keep the costs to a minimum and realise simplifications that make a change. Since the Commission started the following EU simplifications have actually been simplified with the help from the Netherlands:
In 2006 the Council of the European Union agreed to the Dutch proposal to raise the lower limits subject to accounting and reporting rules by twenty per cent. This means that in 2006 the annual accounts of some 250,000 small and medium-sized enterprises (in the Netherlands) will have fewer requirements to meet.
Intrastat Regulation No 3330/91 has been simplified. Per January 1 2005 the observation threshold for the statistics for international trade is raised from 225,000 euro to 400,000 euro. This means the number of companies that need to provide data has been lowered from 30.000 to 23.000 in the Netherlands.
In a move to cut EU red tape, European ministers in 2006 have agreed to scrap set rules on the size of food packages in Europe. The agreement - which must be ratified by the European Parliament - removes the size restrictions on 70 consumer products, from soft drinks to detergent.
The Dutch government considers the EU results accomplished an interesting start, but much more needs to be done to fight bureaucracy. It is time to speed up the simplification program and deliver more results that make a difference for businesses.
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What do other countries do?
Since the Netherlands - and next Denmark - in 2003 started with a new innovative approach to tackle red tape many countries followed. Various countries now follow a similar approach of targeting, measuring, and reducing administrative costs. In Europe 17 Member States are currently applying the Dutch approach in some way, including e.g. Denmark, Poland, Estonia, the United Kingdom, the Czech Republic, Austria, Ireland, Sweden, France and Germany. This number is still growing. Also non-EU countries apply it, like Norway, Turkey, Australia and Canada.
All this international experience offers the opportunity to compare administrative burdens between countries. This provides valuable lessons to further optimize the national situation. In this context countries do for example benchmark exercises, in which the implementation of European Directives is compared from a red tape perspective. The OECD is also carrying out a project in this context.
For more information about benchmarks and the programs other EU countries have to fight red tape, please check: www.administrative-burdens.com.
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International projects
Specific information on joint international projects and the participating countries can be found here.
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