Sins and Systems - Some Perspective Please!
Author:
Terence O'Rourke
The problem with politics is that is so short term. And if a week was a long time in politics forty years ago, I shudder to think what the modern comparison is.
Politicians are forced to deal with issues as they arise. The media demand easy and immediate answers to complex developments. Often any response is deemed better than a proper response. Even the politician with the intention of looking at things in the longer term can easily be blown off track.
Unfortunately in our profession there has been rather a lot of this over the last decade. And there is little use in pretending that the business community hasn’t deserved interference from politicians and civil servants. But once things like that start, they can be difficult to shake off. The number of new initiatives in recent years would be almost unbelievable had we not witnessed and had to deal with them first hand.
In fairness to our Taoiseach, he has at least recognised that there is problem. In launching the Government White Paper Better Regulation he referred to the ‘regulatory impulse’ that we all suffer from. And he’s right – while the era in which Government was perceived as the solution to every problem is over, the era in which additional regulation is perceived as a panacea is well and truly with us.
If we each had a euro for the number of new regulators that have emerged in recent years, we’d be doing okay – each of them with their own start up, premises and capital costs.
No practicing or business accountant has been able to ignore these developments. Our whistle blowing obligations to these state regulators have already become unmanageable and there are more on the way. ICAI will soon be bringing out a discussion paper detailing these obligations and the confusion which they give rise to and requesting a sensible and coherent response from Government, North and South.
But it would be foolhardy too to deny that these initiatives have had results. Compliance with Revenue and the CRO were already increasing before anybody conceived of the Office of the Director for Corporate Enforcement, the Companies Act compliance statement or new provisions in the Finance Bill.
The point here is that there is an appropriate balance to be reached. It is not the Institute’s job to argue against these bodies doing their jobs properly, it is our job to fight bad legislation and bad regulation. Our emphasis must be on what is sensible and proportionate. The Companies Act compliance statement in its present form is neither and that is why we have continued to campaign on the issue from both outside the tent by meeting with the new Minister for Enterprise, Trade and Employment and inside the tent by working with the Director for Corporate Enforcement to improve the draft guidance issued by his office.
Politicians and civil servants are by and large well intentioned and competent. Like ourselves they too have had to adjust to new and interesting times. If they have got it wrong, and they have, so too have we. The last decade has not been easy for anybody.
But hopefully now things have settled down. It may not yet be time, but neither is it far away, that we look at what has been put in place on the regulatory side of things over the last decade and do a proper cost benefit analysis of it. What we need to do that is a period of calm and I think we have arrived at it. It is noticeable that many ‘recent’ scandals actually date back some time. They belong to a previous era.
Collectively we also need to distinguish between sins and systems. We will never stamp out the former there is no system that can catch every misdemeanour. So let’s punish wrongdoers where they emerge and refrain from imposing additional penalties, through costly regulation, on those who adhere to the law. Let this be the era of perspective!