Corporate burnout due to bureaucracy

The oft-promised reduction in bureaucracy isn't happening. At a ZDH panel, the skilled trades sector is demanding that the government keep its promise.

This article is part of the special topic Bureaucratic madness in the craft industry

The density of laws, regulations, orders, and prohibitions in Germany is constantly increasing. Small businesses, in particular, feel increasingly overwhelmed by the resulting bureaucracy. The ZDH hosted a Legal policy podium to discuss with scientists, representatives of the Federal Government and members of the Bundestag ways to to discuss reducing bureaucracy.

The issue of bureaucracy has been troubling the trade for years. Relief However, there has been little support from the federal, state and local governments. In October last year, the ZDH published a catalogue of 16 concrete measures and proposals that could lead to targeted relief for small and medium-sized enterprises.

If politicians continue to fail to find a way to tame the bureaucratic monster they have nurtured, ZDH President Hans Peter Wollseifer fears negative developments, which would hit the skilled trades hard. "Many companies are finding it increasingly difficult to cope with the growing bureaucratic requirements. The overload leads to frustration and ultimately to a climate hostile to innovation," says Wollseifer. Young people are increasingly choosing to become self-employed. Young masters are worried that, in the face of growing bureaucracy, no more time for their customers and to have their craft."

Wollseifer harshly criticized the federal government"The political will to make progress in reducing bureaucracy has diminished considerably. To date, there is not even a draft bill for the planned Bureaucracy Reduction Act III."

Government asks for patience

The representative of the Federal Chancellery Minister of State and Coordinator for Bureaucracy Reduction, Hendrik Hoppenstedt, could give the conference guests little hope that the economy would soon be relieved. Hoppenstedt: "I can understand the impatience of the trades, but I still ask for patience regarding the Bureaucracy Reduction Act III After all, the new federal government has only been in office for a year." According to Hoppenstedt, a law requires a certain amount of lead time so that it is ultimately understandable, manageable, and effective. When developing the drafts, officials must be guided by a total of 50 internal legislative guidelines.

The Minister of State admitted, however, that there are deficits in the development of legislative proposals: "Laws are still being created too much at the desks of federal ministries and too little in dialogue with businesses." In the future, affected Industries and associations at an early stage of the legislative process included Referring to the skilled trades, Hoppenstedt said: "We depend on a healthy and strong skilled trades sector. Therefore, it is important to us that the skilled trades see the federal government as a reliable partner."

Seven years of standstill 

The fact that the often postulated by politicians Bureaucracy reduction has not been taking place for a long time, occupied Klaus-Heiner Röhl from the German Economic Institute (IW) in Cologne. He attested that the federal government has been at a standstill in reducing bureaucratic costs for seven years now. In contrast, however, compliance costs have increased considerably. The main reason for this is the diverse documentation requirements for the minimum wage.

Scientist Röhl recommended to the federal government, to base its legislation on best practice examples from other countriesFor example, Estonia has been an international pioneer in e-government for years. In Great Britain, the focus is already on strong participation by those affected, which ultimately results in laws that are close to citizens and businesses. Denmark, he added, is also characterized by innovative legislative processes in which citizen participation is a top priority.

Increase of 28,5 billion euros possible

According to calculations by the IW, Germany's gross domestic product (GDP) could be increased by 0,84 percent simply by reducing bureaucratic burdens by 10 percent. Measured against the previous year's GDP (€3,39 trillion), this would amount to €28,5 billion. Bureaucracy slows down, This is the conclusion of Klaus-Heiner Röhl, economic growth, investments and company start-ups in Germany.

With regard to the upcoming Bureaucracy Relief Act III, he recommended that the Federal Government simplify the documentation requirements for the minimum wage, Raise turnover and profit limits for accounting obligations, to shorten retention periods for documents and to ensure timely audits.

Holger Schwannecke, Secretary General of the ZDH, appealed to the Federal Government to take up the measures proposed by the craft sector to reduce bureaucracy in order to achieve real relief for small and medium-sized enterprises: "We need legislation that takes into account the situation of our Companies in focus retains, and we need a legal language that the addressees also understand."