Time is Money: How Regulators Can Support Growth (Industry and Regulators Committee Report)

Baroness Harding of Winscombe Excerpts

Tuesday 3rd November 2026 Grand Committee

[Baroness Harding of Winscombe (Con)]

My Lords, I begin by thanking our chair, the noble Baroness, Lady Hayter, for her excellent introduction. I declare my interest as a member of the committee and my interests in various organisations, which are all regulated, as set out in the register.

The challenge with this topic is that, first, there are multiple types of regulator—at least four different types, as we heard in the inquiry: economic, such as Ofcom; market, such as the CMA; technical health and safety, such as the Building Safety Regulator; and systemic prudential risk regulators, like the PRA. So there are at least four types of regulator and there are multiple types of growth. Are we interested in short-term growth or long-term growth—growth in GDP or growth in personal disposable income?

I am in danger of descending into a sort of Oxbridge exam question rather than a five-minute speech in your Lordships’ Grand Committee. It is very hard to generalise, because when we talk about the relationship between regulators and growth, we have too many of both things that we are trying to match together.

However, I will make one general point—others have alluded to this. With the honourable exception of competition regulators, regulators do not drive growth. Generally, they constrain growth. That does not mean that I am against regulators. It is absolutely clear through history that the absence of all regulation is extremely bad for humanity. Think child labour or the thalidomide crisis; it is not difficult to see why we need regulatory guardrails in every market. But generally, too much regulation leads to lower growth, and the challenge is that well-meaning people—the noble Viscount, Lord Chandos, is absolutely right that we are those people—add complexity and cost in regulation if they are not very careful.

I am extremely supportive of the Government’s 25% reduction in administrative costs, but like other noble Lords, I think that that is the cherry on the cake rather than the cake itself in terms of reducing the costs. I refer noble Lords to one of our witnesses, John Fingleton, who led the review into the costs of our nuclear programme. He said to us that not only are we the most expensive country in the world to build a nuclear power plant but we are the most expensive country in the world to build one mile of road, one mile of rail, one tunnel or one bridge. That is not because of the admin costs. The bat tunnel and the fish disco are not encumbered by admin; it is the fundamental building of them that is the problem. I therefore ask the Minister, as I am sure she will update us on progress on the 25% reduction in admin costs: what is the Government’s target to reduce the overall cost of regulatory compliance? Unless we measure that and then target a reduction in it, I am afraid that, inevitably, regulation is hampering growth and not driving it.

The second point I want to make, which other noble Lords have also explored, is on the overlapping regulation problem. As the noble Lord, Lord Willetts, knows well, most scientific discoveries these days come at the intersection of different branches of science. I think the same is true of truly innovative businesses. They come at the intersection of different sectors and, inevitably, overlapping regulators. We have to find a solution to the multiple regulatory problem, which we heard about in this inquiry. It is encouraging to know that Defra is running a pilot to do that, but I am afraid I have become very old and suspicious. A pilot can go on for a very long time and never turn into something that scales. I would love to hear from the Minister how the Defra pilot is going on, when it will extend to other departments, and when it will extend to regulators from multiple departments, which is the real problem.

The final point I will focus on is the one regulator that does drive growth: competition regulators, which my noble friend Lord Black and the noble Baroness, Lady Gill, commented on. Done well, competition regulation creates the conditions for innovation and for growth. I have absolutely no doubt that the regulation of large, dominant tech firms can unlock growth opportunities for British firms. It can increase choice and can reduce prices for millions of consumers. The problem is, as my noble friend Lord Black said, that the CMA’s strategic steer charges the CMA with prioritising pro-investment alongside pro-growth. I think we have to be quite suspicious of international tech companies promising inward investment in exchange for the absence of regulation. History shows that that does not drive growth; it just entrenches monopolies. Like other noble Lords, I want to ask the Minister when the CMA’s strategic steer will be updated and whether it will be updated to focus more on measures of growth as they affect actual British businesses and British consumers than on announcements of inward investment.

I cannot finish without 30 seconds on AI. I also add my voice to ask the Minister when we will hear from this Government on how they intend to regulate AI. As a general purpose, AI technology touches all four different types of regulation. There is undoubtedly long-tail systemic prudential risk with AI. There is definitely health and safety risk and market competitive risk. Yet we keep being told that it is too early to regulate, which I really challenge. I look forward to hearing the Minister’s answer.