24/10/2002 - Two decades of reform have given Britain considerable experience in regulatory matters and a strong capacity to assure high quality regulation. The U.K. now faces challenging new demands reflecting the maturity of its regulatory system, according to a new OECD report.
Regulatory Reform in the United Kingdom: Challenges at the Cutting Edge cites past reforms as having played an important part in Britain's improved economic performance. Strengths of the U.K. economy include a flexible labour market with unemployment among the lowest in the OECD, a world-class financial services sector, and inward and outward investment flows among the highest in the world.
The U.K. regulatory environment is supportive of market openness and global competition. Reforms continue to be pursued in support of public policy goals and private sector needs, including those of small and medium-sized firms. Labour productivity remains a longstanding and deep-seated problem, but the issue and its complexity are recognised by the government, which has identified a five-pronged strategy to improve the functioning of markets by strengthening competition, promoting enterprise and innovation, improving the skills base, encouraging investment and improving public services productivity.
Overall, the report observes, "the U.K. has come a long way and its progress is reflected in a mature and innovative regulatory system. The U.K. is at the forefront of regulatory reform in the OECD, it has already made major improvements and has planned more. Building on what it has already achieved, the U.K. now faces challenges as well as opportunities to confirm regulatory reform as a key driver of economic performance."
Among strong points in Britain's present regulatory system, the report notes that:
Looking ahead, the OECD report cites a number of unprecedented new demands on the U.K. regulatory system, which it says are equally relevant for other OECD countries. These include:
Commenting on the publication of the OECD report, Lord Macdonald, the UK minister responsible for regulatory reform, said: "We are encouraged by the OECD's recognition that regulatory reform has helped to create a better business environment than in most other OECD countries. Better regulation in the UK has been helped greatly by the high degree of openness and exchange of ideas between government and business and by the activity of a broad range of NGOs".
The report on the U.K. is the latest in a series of such reviews of OECD economies. Others have covered the U.S, Japan, Mexico, the Netherlands, Korea, Spain, Hungary, Denmark, Italy, Ireland and Poland. The report reflects the input and views of all 30 OECD Member countries and the European Commission, as well as contributions from the business and labour communities.
The report is available to journalists on the OECD's password-protected website or from the OECD's Media Relations Division . For further information, journalists are invited to contact César Córdova Novión in the OECD's Public Administration Service (tel.  1 45 24 89 47).
The report is on available through the Online Bookshop.