The single market is all about bringing down barriers and simplifying existing rules to enable everyone in the EU - consumers and businesses - to make the most of the opportunities offered to them by having direct access to 27 countries. The cornerstones of the single market are often said to be the ‘four freedoms’ - the free movement of people, goods, services and capital. These freedoms are enshrined in the EC Treaty and form the basis of the single market framework.

Since 1993 when the EU single market became a reality, it has grown to become biggest single market in the world, with almost 500 million people (greater than the combined population of Japan and the USA). It is now a major market for UK products and a fantastic opportunity for UK businesses. More than 30 million jobs in Europe are involved with trade within the Single Market and approximately 3 million UK jobs are linked with exports to the EU.

The UK Government believes that the Single Market has the potential to bring about further improvements in EU productivity, but achieving this will require further market integration and strengthening of competition. The European Commission estimates that removing the remaining barriers that exist within the Single Market could increase the EU's GDP by 2.2% and create an additional 2.75 million jobs across Europe. It could also mean the average European citizen would find themselves roughly £400 per year better off.

The European Commission presented its review of the Single Market in 2007. The UK welcomes the new flexible approach proposed, focussing on the key priority areas where businesses and citizens can benefit, such as further liberalisation of the network industries; using competition policy to reduce barriers for businesses, particularly small and medium sized businesses (SMEs); and allowing consumers to benefit from more choice and lower prices.

 

Better Regulation

 

Better Regulation is a broad strategy to improve the regulatory environment in Europe. It aims to consolidate and simplify existing legislation, and to improve the quality of new legislation by better evaluating its likely economic, social and environmental impacts.

Reducing red tape will help UK businesses and can contribute to boosting productivity and employment, thus contributing to Europe's growth and jobs agenda. The UK Government is currently amongst the leading European countries in lowering regulatory burdens for business and we have played a prominent role in advancing the better regulation agenda in Europe - helping to secure agreement by all EU Member States to cut administrative burdens by 25% by 2012. Achieving this target could benefit the EU’s GDP by around 1.4%, or €150 billion.

The second half of 2008 will also be a crucial phase in the efforts to reduce administrative burdens across the EU as the European Commission is expected to propose simplification proposals to help meet the target of 25% by 2012. We also expect the European Commission to present new guidelines before the end of 2008 on how and when impact assessments should be carried out. We expect the French Presidency will push to improve the use and quality of impact assessment across the EU institutions, something the Government strongly supports.

 

Small Business Act

 

The EU is also working to improve the enterprise environment for Europe's small and medium sized enterprises (SMEs), recognising their role in delivering economic growth. Over 99% of companies in the EU are SMEs and in recent years they have created 80% of new jobs in the EU.

In June 2008, the European Commission set out a package of measures aimed at  fully unlocking the growth and jobs potential of SMEs and making full use of their innovative capacities. The proposed "Small Business Act" (SBA) for Europe outlines a number of political principles accompanied by a set of ambitious actions by the EU and Member States. The Government fully supports this initiative and welcomes the emphasis placed on it by the French Presidency. We will be working with the Presidency, the Commission and other Member States to ensure that the SBA makes a positive contribution to enterprise in the UK and across the EU.