Untangling Germany′s Bureaucratic Jungle | Business| Economy and finance news from a German perspective | DW | 26.04.2006
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Untangling Germany's Bureaucratic Jungle

The German government has launched a major initiative to cut through the piles of bureaucratic red tape that in recent years have proved a major impediment to economic growth and free enterprise in Germany.

Germans may love paperwork, but it's time to simplify

Germans may love paperwork, but it's time to simplify

A few weeks ago, thousands of German doctors took to the streets to protest poor working conditions -- including the jumble of bureaucratic red tape they face in their daily work. Among them was Ravindra Gujullah, an Indian-born general practitioner who runs his own clinic in a village outside Berlin.

"Everything you do with a patient means a particular number of points," he said. "For an electrocardiogram I may have 250 points, for a stress electrocardiogram about 500 points. For every point, I get a certain sum of money, but this amount changes every month. It is a very peculiar thing because although I have more and more work to do, the money is actually decreasing."

Ärzte Protestwoche in Deutschland

Doctors demonstrating against bureaucracy in the health system

Gujjulah says he spends at least two hours every day doing paperwork required by German authorities -- most of which, he believes, will end up in a wastepaper basket.

Estimates say that rampant bureaucracy today wastes a staggering 4 to 6 percent of the turnover of small and medium-sized enterprises in Germany.

Freedom for all

Chancellor Angela Merkel's cabinet has therefore set up an independent panel of experts charged with assessing the costs incurred by Germany's bureaucratic jungle, and making proposals on how to thin it out. The panel's motto: "More freedom for all."

"The first principle is more freedom for our companies to produce more and to employ more people," said Hildegard Müller, who will oversee the panel's work. "The second aim is to make it easier for the general public to live here and have more freedom of personal activity."

The panel has adopted an approach known as the "standard costs model" which has already been successfully applied in the Netherlands. During phase two, the experts will check existing and future laws to see how they can be changed to save costs.

A catalog of 16 red tape-saving measures was already enacted on Tuesday. Among other things, it frees more than 150,000 small firms of previous strict bookkeeping regulations and statistical duties.

Overcoming past failures

Müller is convinced that, unlike previous attempts to slash bureaucracy, this time, the government will succeed.


Small businesses would profit from having to do less paperwork

"I think we have a great chance because this time both the major parties -- the Christian Democrats and the Social Democrats -- stand behind this initiative," she said. "It is an initiative by the chancellery and not just by a ministry. The whole cabinet today agreed that it’s a main issue for this legislature."

Müller added, however, that she expects resistance from a variety of lobby groups. But the chancellor is determined to complete this task, she added, and has already promised to take this initiative to the EU level, where she believes red tape is even more of a problem than it is in Germany.

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