Legally speaking, in the UK anyway, the indicated speed limit is a maximum speed (aside from the different coloured signs you get sometimes which are minimum speed). They tend to allow about a few miles extra before prosecuting, in the grounds that speedometers aren't that accurate, and a prosecution might fail if a driver could persuade a court that his (or her) speedometer was misleading them.

In practice people typically add that few miles on to the speed they aim to drive - if their speedometer is in fact reading low that means they will be going quite significantly faster than the limit.

The obvious thing would be to require that speedometers were accurate, and that it was the duty of the car owner to keep them accurate.

The speed limits that are far to high are in residential areas in towns, where a maximum of 20 miles an hour makes a lot more sense than 30. I'd be willing to trade slightly higher legal speeds on motorways for a general 20 mph limit in streets.