The Obama Administration announced its plan for regulatory reform today, with proposals submitted by over 26 federal agencies to fit their operations' costs into the shrinking fiscal budget, while adding some business-friendly features as part of the reform. In a statement, the administration said the reform is geared toward reducing costs, simplifying the system, and eliminating redundancy and inconsistency.   

“Today's cost-reducing reforms complement, and do not displace, our continuing efforts to safeguard public safety and our environment,” said Cass Sunstein, the administrator of the Office of Information and Regulatory Affairs in a statement. The agencies' reforms are in response to President Obama's directive earlier this year for departments to eliminate red tape and streamline current requirements.

More than 26 plans were submitted with four other proposed plans highlighted pending final adoption. Key plans include:

The Department of Health and Human Services proposes to remove unnecessary regulatory and reporting requirements on hospitals and healthcare providers—aiming to produce an estimated $4 billion savings over the next five years.

The Department of Labor is finalizing a rule to simplify hazard warnings for workers, with the potential to save employers over $2.5 billion in the next five years while maintaining high standards of safety.

The Department of Transportation announced a proposed rule to eliminate burdensome railroad industry regulation, which would save the industry up to $340 million and avoid passing on regulatory costs to consumers.

The Internal Revenue Service will eliminate 55 million hours in annual paperwork burdens by year-end through consolidation of reporting requirements and simplification of tax forms.

According to Sunstein, many of the new reforms focus specifically on small businesses. An example is the new rule issued by the Department of Defense recently to accelerate payments on contracts to as many as 60,000 small businesses. The step is targeted to improve the cash flows of these businesses, given the current cash-strapped business environment, Sunstein said.

The business community, however, is skeptical. The reform essentially will bring little to no benefits to businesses,  as the findings and determinations made in concluding the final plans only involved the federal agencies, says Bill Kovacs,  senior vice president of environment, technology, and regulatory affairs at the U.S. Chamber of Commerce.

He said in a statement, “The administration's findings and determinations, on their own, are a worthy effort at making technical changes to the regulatory process, but the results of this lookback will not have a material impact on the real regulatory burdens facing businesses today.”

Kovacs said real regulatory reform would include requiring transparency in the building permit approval process, requiring agencies to differentiate between major and minor rules, and applying all the laws Congress has passed relating to regulatory reform. “This would ensure that agencies not only do regulatory lookbacks, but also that they use the best information available in developing regulations,” he said.