Step 1: The sentence has two clauses joined by 'but', a word that always signals a contrast or reversal between the intended purpose and the real result.
Step 2: The first clause states the policy's goal: to affect bureaucratic delays. The second clause, introduced by 'but', must describe an outcome that goes against that goal.
Step 3: Check each pair for internal contrast. 'Increase ... simplified' has the goal already negative (increase delays), so 'but' would need a positive twist, which does not fit 'further complicated' territory. 'Reduce ... simplified' has no contrast at all, both are positive. 'Eliminate ... shortened' also has no contrast, both positive. Only 'reduce ... complicated' sets a positive goal (reduce delays) against a negative real outcome (complicated the process), matching the logic of 'but'.
Correct option: (1) reduce ... complicated.