The devastating fire that engulfed the high-rise housing estate of Grenfell Tower in London and claimed 79 claims emerged from a toxic combination of bad policies and poor govenance. One of the culprits appear to be the proclivity to pursue a deregulatory agenda in the mistaken belief that reducing the regulatory burden on business would unleash private sector growth and economic prosperity. Instead, what it does is inflate profits by reducing compliance costs. These profits do not necessarily translate into better jobs and greater prosperity for all.
The UK government embraced the so-called ‘one in, three out’ approach with respect to regulation. In other words, every piece of new regulation can only be accommodated if three existing ones are eliminated. Thus, as a New York Times editorial points out:
“…a British law first passed in 2011 … requires the elimination of regulations as each new one is enacted. At first, one rule had to be ended for every new rule passed. That was later expanded to “one in, two out,” ….In 2015, British law became “one in, three out.”
The editorial argues that this diluted basic safety standards (such as lack of sprinklers in a high rise housing estate that was built in 1974) that enabled the Grenfell tragedy. Other countries, and especially those in the developing world, should pay heed to the perils of deregulation.