That's certainly bad, and puts me in mind of my recent experience at a nearby house where I found such horrors as a 7kW shower on 2.5 cable, 1.5 mm socket spurs off a broken ring on a 30A semi-enclosed fuse, etc.
As for government regulation of people carrying out wiring though, I see two problems.
First, how would it be enforced? It is already illegal to make changes to gas appliances or fittings unless qualified, but that doesn't stop people doing it. If it's inside the house, nobody is likely to notice, unless you're going to give local council officials powers to enter and inspect premises at will. I don't think anyone would tolerate that.
Second, however bad some wiring is, and however much I would like to see people do things the right way, I do not believe that the government has any right to tell people that they cannot carry out work on their own house.
Inspections when a house changes hands would be the way to reassure the new owner that everything is safe, but he can arrange his own inspection if he so wishes anyway.
Aren't there already plans to legislate for mandatory inspections when a house is sold? I've not heard anything more about that for a while. I wonder whether wiring would be specifically excluded from such an inspection though, along with central-heating systems and other "specialized" items.
