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

Baroness Hayter of Kentish Town Excerpts

Tuesday 3rd November 2026 Grand Committee

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[Baroness Hayter of Kentish Town]

That the Grand Committee takes note of the Report from the Industry and Regulators Committee Time is Money: How Regulators can Support Growth (3rd Report, HL Paper 301, Session 2024–26).

[Baroness Hayter of Kentish Town (Lab)]

My Lords, in addressing our report I pay tribute to our committee staff, Rhiannon Williams and Dominic Cooper, together with invaluable support from an NAO secondment, Sarah Pearcey, and committee members, including the noble Baronesses, Lady Harding and Lady Valentine, and the noble Lords, Lord Fuller and Lord Udny-Lister, from whom your Lordships will hear today, along with my noble friend Lady Carberry and the noble Lord, Lord Camoys, who are also on the committee and from whom we might hear today. We will also hear from my noble friend Lord Chandos, who was in at the start of the process, although he then escaped for good behaviour.

I start with an apology to my noble friend Lord Smith of Ranmoor for misnaming his former organisation, the FSA—obviously it is the agency, not the authority—in the table on page 11. I have to confess that it was he who spotted that, not me.

I also thank the then relevant Ministers, my noble friend Lord Livermore and Blair McDougall MP— notably and significantly from both the Treasury and the Business Department—for appearing in front of the committee, as did the noble Lord, Lord Willetts, who was of enormous assistance to our work.

The report examines the Government’s attempt to help boost their growth objective via their action plan for regulators—an objective that I am sure the Committee shares. Writing in the Times on Saturday, however, the Chancellor admitted that

“growth cannot be commanded from Whitehall”,

but that it could be helped by removing the barriers that hold back investment and by bringing down costs and bureaucracy, which Ministers judge includes regulation. That led to the question that we asked as to the impact that regulation can have in encouraging or facilitating growth and whether the Government’s action plan will help regulators to achieve this objective.

Done well, regulation can boost consumer confidence, can provide a level playing field that helps competition and can help provide certainty to businesses and investors, whether from here or abroad. Done badly, particularly if it is slow, regulation can cause uncertainty, costs and delays to new products, services and infrastructure and it can harm the economy and disadvantage consumers by denying them cheaper, improved or new products.

While our committee welcomed the intention of the Government’s action plan, it was not always apparent what this meant for individual regulators, whose responsibilities can differ greatly. The Food Standards Agency, for example, wants there to be more nimble and accessible new technologies, but could that conflict with improved agricultural trade with the EU? Other regulators have vital objectives for safety, health and the environment, as well as for consumer protection, so they need to weigh up whether any relaxation on their focus on those important issues could leave workers, shoppers or road users more exposed and carrying more risk themselves. We therefore ask Ministers to provide individual regulators with a more granular picture of what their growth agenda actually meant in practice.

The Government’s response was that they had issued more specific goals to key regulators, although these largely related to specific activities, rather than clarifying how a focus on growth should be balanced with their core objectives. However, just as the Government need to be clearer about their expectation of regulators, so regulators should be clearer as to how businesses should comply with their various demands. We heard from witnesses that too often a lack of early engagement and dialogue and an absence of guidance led to duplication and delay of approvals, which brings us to the question of speed—or pace, as seems to be the in word these days.

Our recommendations here are important for the Government’s agenda but have a resonance beyond this. All regulators should work quicker and smarter than they often do. They are dealing with services and manufacturers, developers, entrepreneurs or innovators in the real world. As the title of our report suggests, time is money. Time can sometimes save lives, when new safety devices, drugs or health breakthroughs could be approved with due checks but without unnecessary red tape. It seems that red tape is indeed the issue sometimes.

Regulators have two tasks: to enforce their actual regulation but also to run an assurance scheme that checks on compliance. We had one question: is the Government’s 25% desired cut on admin the most important measure, or is it the cost to manufacturers of making the adjustment in what they are producing to comply with the rules? The example that we heard was whether it was more expensive for a fridge manufacturer to make sure that the fridge was built to comply with rules or whether it was the paperwork to show the regulator that they had complied with the rules. The Government replied that they had identified £2 billion in admin costs, a third of the £5.6 billion target, although they said that they would also address broader regulation costs to ensure that businesses benefit from reforms. We urge the Government to focus on the wider issue of regulatory compliance, not just red tape, especially as this has lessons for the future.

In this House, as those who have been here a long time will know, we often jib at allowing ministers too much power under secondary legislation, which Parliament therefore cannot influence. But in this report we found that sometimes over-prescriptive rules in primary legislation mean that outdated requirements cannot be quickly altered, even when a regulator wants to do that—so there are lessons for future legislation. Indeed, since this report, our committee has now heard particular examples of legal regulations. The example that we give, looking at the defence industry, is the requirement in law for life jackets on boats. That requirement becomes a little bit meaningless when we are talking about uncrewed vehicles. The regulation cannot be dumped because it is in primary legislation, yet the whole nature of warfare changes as we use autonomous vehicles. That is a lesson for future legislation.

There is another aspect of regulators’ behaviour that is alleged to get in the way, the tendency to risk aversion—and that is easy to understand. When they do something right, nobody notices that the regulators even exist, but one fault, one accident or serious injury, or damage, and the press and Parliament are down on them like a ton of bricks. If the Government want regulators to be bolder in decision-making and less risk-averse, and allow them to see the upsides as well as downsides of new developments, the Government are going to have to provide some political cover for regulators. Each sponsoring Secretary of State must make it clear to their particular regulator that they will honour that.

Indeed, the leadership of regulators is vital in mitigating, rather than avoiding, risk. The appointment of the chair, and often the board, is in the hands of Ministers, as are discussions on their annual reports. Ministers must make their expectations clear and their own tolerance for risk understandable to the regulators, along with the degree to which they are willing to allow consumers to bear any resulting risk if exact regulations are not nailed down and enforced. Ministers are calling for a culture change among regulators, but it will be achieved only if they understand that the level of acceptable risk is a political decision and should be decided by Government, and that they must set out their own risk appetite for regulators and give a clear steer as to when that could be sacrificed to help promote, or at least not stifle, growth. The Government are going to strengthen the growth duty in the regulation for growth Bill and issue steers to guide regulators in applying the new duty, so can my noble friend the Minister let us know when we might expect the Bill?

There is clearly significant room for regulators to improve how they work, especially on the pace of decision-making. Delays increase the cost of borrowing and can make the UK less attractive for investment. Time is money, and speed was the main ask we heard from businesses. While the action plan floated the idea of paid-for fast lanes for approvals, we concluded that allowing some companies to pay for quicker decisions could reduce public trust, disadvantage small or innovative new entrants and remove the incentive for the regulator to speed up all of its processes. All companies need speed, not just the rich ones.

The issue of pace came through strongly, and therefore while we acknowledge the idea of looking for paid-for regulators, it seemed to us that there were other ways to improve things, whether by digitisation, AI, regular and earlier dialogue or a more proportional approach. There are some areas in which companies have to deal with more than one regulator, leading to a government pilot which we welcomed, with a lead environmental regulator. However, that initiative applies only to regulators within the same department, whereas many companies have to deal with more than one department. It also does not allow decision-making to move to the lead body. Can the Minister update us on the work and thinking in that regard?

The committee agrees that the Government are right to turn their attention to the role of regulators, which could make a useful, though not decisive, contribution to the growth objective. Regulators can deter but not actually create growth, but they can certainly facilitate it. However, the Government must take some strategic decisions to fill their scope in this regard. Ministers will have to provide political cover if they want regulators to be less risk-averse, and they must use their role as sponsoring Ministers to ensure regulators up their game in their processes, speed of decision-making and openness to dialogue with the regulated community. Every regulator must maintain a solid focus on their core function, whether that is financial stability, health and safety, consumer protection or fair competition. I commend the Government for their work in this area, and I look forward to seeing the outcome of their action plan in due course. I beg to move.

--- Later in debate ---

[Baroness Hayter of Kentish Town (Lab)]

I will try to do this briefly, as I can see that team B is just arriving.

I thank all the speakers, and I especially thank the Minister for that reply. She ought to take great comfort from how much agreement there was across the Room—although I know that no Liberal Democrats spoke. There has been a very strong commonality in our responses, particularly on the idea that regulation cannot create growth. The comment from the noble Lord, Lord Udny-Lister, about infrastructure pointed to where that could be of advantage more broadly. I am afraid I have been exchanging texts with the staff, and they think that it was the noble Lord who came up with the title, Time is Money. Can we congratulate him on that?

I will not try to repeat everything, except to say three things; I apologise for having said them before. One is that there was commonality around the need for regulators to be able to respond rapidly to innovation and to provide the pace, clarity, certainty and predictability that business needs. The noble Lord, Lord Ashcombe, used the phrase “intelligent regulation”, which may encompass it, but I think that it was the noble Baroness, Lady Harding, who said that all this has to be in the interest of British business and the British public. That is really the core of what we want to do.

There are three points to take away. As my noble friends Lord Chandos and Lord Sikka said, we must not lose sight of the need to protect consumers. These regulations did not grow. We do not have statutory regulation by accident; it is there for a purpose, and we need to continue to protect that.

Secondly, we need political cover if we are going to ask regulators to become a little more chancy and to meet the challenge that we and the Government have sent their way.

We also need to recognise the costs of poor regulation. It will fall to the Government to enable regulators to respond to new technology, but there are certain things that only the Government can do—the single front door, for example. No one regulator can do that or, in the words of my noble friend Lady Gill, deal with legacy rules. That falls to the Government, not to individual regulators.

The other challenge is that the existing growth duty—it is not new—has done very little to change regulators’ risk appetites, because it added another duty. They are going to have to make trade-offs. The Government must respond to that and think about how to change the conflicting demands of their core responsibilities and this, as well as about how to balance these new demands.

There are, therefore, things for the Government to do that individual regulators cannot do. Perhaps we can invite my noble friend the Minister to come to our committee when the Bill is published—I hope that the members of my committee will agree to this—to discuss how we can move forward. With that, I thank everybody for their contributions and I commend this report to the Committee.

Motion agreed.