18 January 2006

The Web
Business Today

Cut the red tape

An important message that came out from last Sunday’s GRTU general conference is the need for politicians to abandon their rhetorical fight against excessive bureaucracy and get down to implementing the changes that matter.
The weight of bureaucracy on businesses is too heavy. Red tape translates into loss of time and money, especially for small and medium sized enterprises where single individuals have to waste precious time filling up government forms and applications, answering official letters and running from one department to another to obtain a permit of sorts.
Complaining about bureaucracy is no cliché. And yet, little has been done to reduce the administrative burden in a meaningful way. In some instances government has even failed to address long-standing complaints when it had a chance to do so.
One such example is government’s failure to include the elimination of summer half days in the new collective agreement for public sector employees.
Half days do not only translate into a major inconvenience for individual or business customers of government departments but more seriously for businesses, the half days also have financial implications.
It is not the first time that importers end up paying additional costs in overtime for customs officials when containers are to be unloaded in the afternoon. This is one aspect of government-induced inefficiency which is paid for by the private sector.
And to make matters worse, the last decade or so has seen an additional blanket of bureaucracy being introduced in the form of autonomous agencies and authorities, which have complicated matters rather than simplified them.
A concerted effort is needed to address the administrative burden at all levels of public administration. Politicians have to stop the chatter. Although Lawrence Gonzi’s idea to set up a unit, to examine new and previous regulations to ensure they are business-friendly, is a positive step in the right direction, the GRTU members he was addressing want to hear a different song.
The very notion of creating another unit and more so under the Prime Minister’s remit, as if he does not have enough on his plate already, sends shivers down the spine of businesspersons.
A new unit will require its own administrative set up and possibly require funds in the form of additional payments to the people running it. In the minds of many it is simply another bureaucratic layer.
Once upon a time when Lawrence Gonzi chose his own cabinet in 2004 he created a new ministerial portfolio to address competitiveness. The idea was to have a minister dedicated to improving this country’s competitive edge in all aspects.
This ministry should have had at the top of its agenda the remit to investigate the bureaucratic situation in all departments and propose a new way forward to cut red tape and ensure a more business-friendly environment.
This did not happen. The ministry was not even involved in the discussions at the MCESD to draw up a social pact primarily aimed at increasing the country’s competitiveness.
It is not that the minister, Censu Galea or his underling Edwin Vassallo, are cut off from what SMEs are feeling. They are good listeners and Vassallo has the added advantage of having his own family business in retail but they seem to be powerless in dealing with other ministries or agencies.
The original idea to address competitiveness at ministerial level failed and the business community is excused if it greets Lawrence Gonzi’s latest idea with extreme caution.
Politicians have a habit of hyping up ideas before they come to fruition and that can have disastrous results as happened in the Gama textiles fiasco.
Instead of pontificating on the need to cut bureaucracy, politicians have to act fast.
Red tape has become the tool by which businesses are being suffocated and at a time when consumer confidence is at an all-time low, oxygen is fast depleting.
The system has to be jolted and a new mentality has to prevail. Businesspersons need to be speaking to civil servants who can understand the sense of urgency that constantly hounds the business environment
Only time will tell if Gonzi’s new unit will deliver the goods. Businesspersons are on the lookout for any changes; their livelihood is partially dependent on a streamlined government operation.

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Editor: Kurt Sansone
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