Myth: EU red tape costs business £600m per week
InFact: Alongside the £600m costs come £1.1 billion in benefits. But even that figure just considers the benefits for businesses, not for citizens. We also wouldn’t cut most EU rules if we quit.
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The figure of £600 million a week comes from a study by the think tank Open Europe on the cost of the 100 most expensive EU rules, which finds they amount to £33.3 billion a year or £640 million a week. Alongside this figure, Open Europe also found there were benefits, such as cleaner air. Benefits are estimated at a total of £58.6 billion or £1.1 billion a week. That’s a net gain of £487 million a week.
Benefits such as facilitating trade across the single market are not quantified. Nor is the impact on citizens or employees, since only business and public sector costs and benefits are tallied.
Many of the rules considered are ones we would want to keep after Brexit. Rules to tackle climate change or make banks safer post-crisis are things the UK has been enthusiastic about, independently of the EU. Both of those EU laws derive from international agreements to which we would still be party after Brexit.
For these and other reasons, Open Europe thinks the “politically feasible” cuts in red tape could only reach £12.8 billion, for which we would lose a corresponding benefit to businesses and the public sector of £4.3 billion.
This article is an adaptation of a piece that previously appeared on InFacts. It was amended on 10 May to add in extra material.
Edited by Yojana Sharma
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