New textbook on regulatory policy

Earlier this month, OCDE published a new reference book for members of our community: the first edition of the OECD Regulatory Policy Outlook 2015. This magnum opus summarizes 10 years of experience in designing and applying better rules and regulations to achieve economic and societal policy objectives. A press release summarizes the approach and the main conclusions, but experts will need to download the full material, which includes, to illustrate and give practical impact to each dimension (RIA, simplification, regulatory costs, etc), best national practices.

(From the press release): "The report finds that 33 of the 34 OECD countries have adopted an explicit regulatory policy and require regulatory impact assessments and public consultation for all new regulations, while 29 have a designated minister to promote regulatory reform.

However, a third of OECD countries have no policy at all on regulatory compliance and enforcement, and two-thirds have no system for evaluating laws once they are implemented. This creates unnecessary costs for businesses and society, the report says.

Internationally, co-operation in law-making is essential for creating global rules and standards, addressing trade frictions and environmental risks, and reducing the risk of regulatory failures such as the 2008 financial crisis or the recent VW emission tests scandal. Yet only a third of OECD countries have a clear policy for international regulatory co‑operation."

Joint letter pressing EC for sectoral redution targets

The Competitiveness Council is holding today 30 November a meeting where ways and means of speeding up reforms to the single market are expected to be discussed and perhaps agreed. A widely supported initiative from the UK, now uniting 19 of the Member States including France and Germany, is spelling out the reform agenda in a joint letter dated 26 November now published in final format, to assist VP Timmermans achieve consensus on the way forward.

A blog post dated 1 October summarizes the letter with useful comments and incidentally shows the outcome of some last-minute lobbying by the UK, including the notion that "Britain is pushing for a series of EU reforms, as the price for Prime Minister David Cameron's support for continued membership of the bloc in the "Brexit" referendum. He has called for measures to improve EU regulation, reducing administrative costs for businesses, and to bolster the bloc's competitiveness." They include the idea of sectoral targets ("EU reduction targets in particularly burdensome areas.") Our thanks to Julian Farrel for pointing out this relevant initiative. See also EC website on Better Regulation.

Stoiber Group: final report

On 14 October, the Commission published an update on outgoing President's action for EU law: 

"Under the title "Smart Regulation in the EU – Building on a Strong Foundation" politicians, stakeholders and experts have been examining the achievements and persisting challenges in the field of smart regulation, administrative burden reduction and better implementation of EU legislation. On this occasion, Dr Edmund Stoiber, the Chairman of the independent High Level Group on Administrative Burdens advising the Commission since 2007, will hand over the group's final report to President José Manuel Barroso.

Canada legislates One-for-One Rule and releases Red Tape Scorecard

(Announcement) On January 29th , Treasury Board President Tony Clement introduced the Red Tape Reduction Act (Bill C-21) in Parliament to enshrine the One-for-One Rule in law (see news release). The One-for-One Rule is the cornerstone of the Canadian Red Tape Reduction Action Plan. On January 28th, The Government of Canada released its first Scorecard Report outlining the substantial progress made in cutting red tape for Canadian business, under the Red Tape Reduction Action Plan (see news release).

British regulatory watchdog shows teeth

The UK independent regulatory oversight body, the Regulatory Policy Committee (RPC) has just released its 2013 annual activity report, which makes good reading for experts seeking to ascertain the possible authority of such an institution.
The RPC gives figures on how many new departmental proposals for regulatory change it has examined and how it has dealt with departmental estimates as to the anticipated regulatory costs for business and others, showing a strong determination to improve the evidence base for decisions concerning new regulation.
Excerpts from the Executive Summary:
- (the Committee) "rated 75% of first-time impact assessment submissions as fit for purpose, a reduction from 81% in 2012. The reasons for this are not completely clear. In some cases, the work may have been hurried due to parliamentary timetables. In other cases, the pressure to meet the One-in, Two-out policy may have reduced the accuracy of departmental estimates. The introduction of the fast track system in August 2012 makes comparisons between years harder, because some simpler cases no longer need to go through the full scrutiny route. This means that those subject to full scrutiny are now, on average, more complex.
- (the Committee) published four red-rated opinions as a result of departments consulting on proposed new regulations despite the RPC rating the impact assessment as not fit for purpose. "

Rapport sur les charges réglementaires en Suisse

Nicolas Wallart, membre suisse de Smart Regulation, nous informe de la parution d'un rapport qui évalue les coûts de la réglementation dans 12 domaines en Suisse (charges totales, pas seulement les coûts administratifs). On arrive à 10 milliards de Fr. ou 1.7% du PIB. Le rapport contient également un paquet de 32 mesures d'allégement. Le rapport est disponible en français, allemand et italien. 

Voir l'excellent résumé officiel en ligne sur le site de l'administration suisse.

Independent better regulation council to be formed in Norway

According to a news item from  Regelrådet,(the Swedish Better Regulation Council), the newly elected Norwegian government has announced in its platform that an independent better regulation council will be formed. It is to be formed based on its Swedish counterpart. The government has also set a net target of 25% for reducing costs to businesses incurred by legislation. They also intend to simplify the public reporting portal Altinn even further to secure that businesses only have to report once." There are already such oversight bodies in the NL (Actal)), the UK (RPC)) and Germany (NKR). There is other interesting news on the Regelrådet page, like the government decision to make Regelrådet a permanent feature in the Swedish legislative process.

Culture change for regulators (Australia)

The Australian Productivity Commission release a research report earlier this month on "Regulator Engagement with Small Business" according to which "Regulators can do more to reduce the compliance and enforcement burdens they impose on small businesses. The Commission argues that regulators should ensure they understand how regulation impacts on small business and keep the compliance capacity of small businesses at the forefront of their minds." A regulator's culture and attitude towards business should include the following improvements:

• Regulators should adopt a multi-channel approach to communicating with small businesses with a focus on the brevity, clarity and accessibility of information. 
• Compliance and enforcement strategies should be proportionate to risks posed to communities and facilitate voluntary compliance. 
• Regulators should commit publicly to target timeframes for key processes, report on their performance in meeting targets, and consider other measures to improve timeliness. 
• Regulators should have access to a sufficient range of enforcement tools and be resourced to do their job effectively, to avoid the shifting of direct and indirect costs onto businesses.

SCM Working Group Helsinki Meeting

On 20 September 2003, the SCM Network working Group meeting was held in Helsinki, Finland. More than 30 delegates attended for this meeting, which included for the first time, delegates from Croatia. The meeting was opened by the Hon. Janne Metsamaki, the Finnish State Secretary responsible for reducing Administrative Burdens. He stated that the Finnish Government has committed itself to avoid both increasing the costs incurred for and adding to the regulatory burden on the industry through its decisions. 

Even though there is no reason to feel pleased about the economic downturn in the Euro area, Hon. Metsamaki said that this situation has brought the bureaucracy experienced by businesses in Finland into greater focus in public debate. Politicians cannot afford to weaken the operating conditions of companies with excessive bureaucracy. He mentioned that the one good thing that will come out of this downturn in economic activity is that policy-makers are now better equipped to make decisions with a genuine impact on reducing the burden on businesses.

The meeting discussed the various initiatives that are being implemented in a number of Member States when it comes to the development of eGovernment for the various services being offered by Government Entities to the business community and the citizens.

Gerald Reindl explained how in Austria, they have introduced the Austrian Business Service Portal. This a central eGov one-stop-shop for businesses which will provide information and transactions, enable businesses to have an efficient administrative procedures with the Federal Government while at the same time cutting costs of up to € 300 million.

Janek Rozov presented the Estonian case of their development of a Register of Economic Activities. The objective of this project was to standardise public services and develop physical and virtual service environment according to citizens' perspective. The advantages of having such a Register is that Estonia managed to group the regulations about economic activities into one general Act. Thus all the necessary information that one needs to know about areas of activity subject to special requirements, were assembled in one place. With this Register, applications for licences, notices and information of economic activities can be affected through this channel of communication.

Pierre Schilling, showed how the MyGuichet functions in Luxembourg. Through this system, all forms can be filled and sent on line. Moreover, both the citizens and the businesses can follow-up on the procedure and state-of-play of application. Communications and notifications are done via the same system. To ease the process, documents can be uploaded on the system and the procedures can be carried out by a proxy.

Elina Koskentalo delved into the development of the XBRL system in Finland. The eXtensible Business Reporting Language (XBRL) helps businesses to present the financial data in a structured and machine readable format. Moreover, the system will process the data in an automated formation and processing of reports. The benefits from such a system results from having easy accessible data, reliability of data, comparability, economical transparency and the availabilty of real-time economy data.

 Kostantinos Bovalis, gave a detailed presentation on what the European Commission is doing in this field. He mentioned that the challanges facing public administrations is that of improving the quality of their operations so as to have increased competitiveness and productivity for EU businesses. The need is there to develop synergies among institutions so as to enable effective resource utilization in piblic sector agencies.

The ISA - Interoperability Solutions for Public Administration – system that the EU had developed, has interoperability aimed at introducing an efficient eGovernment services  both at national and at EU level.  Elisabeth Kristensson explained how they have created a technical infra-structure for reporting once only obligations. She mentioned that the Swedish Government embarked on a project whereby by 2020, business community will in most cases submit information once and to one place. By doing this, the businesses will feel a positive and noticeable change in their day-to-day operations.  When this system is in place, the one million plus companies, will save a yearly 2.25 billion SEK in administrative burdens. (summary by Paul Debattista, Malta)

 

New BR developments in France

Owing to its importance, it is worth returning to the news reported (in French) in a 31 July post about recent trends in regulatory policy in France, which are increasingly inspired by the principles of better regulation.
First of all, the two new policy documents are much more concisely drafted (two pages only), which considerably increases the clarity of their purpose. Both texts also insist on organising two-way communication with the users (the general public and the economic actors):
1/ the "protocol for relations with deconcentrated services" a title which unfortunately will not mean much for foreign colleagues, contains a new policy for communicating within government, in this case with (subnational) implementation levels. The most important novelty is to reserve the "circulaire" (ministerial guidance) for instructions for the implementation or public policy, in under 5 pages. Less formal guidance (such as information, clarification and methodological recommendations) should be interactive, offering FAQ and other cooperative channels. The new policy is interesting because it breaks with the classic tradition that circulaires were not allowed to contain any regulatory prescription. Now, they are to be expressly billed "instructions from the Government" for the sake of clearer communication.
2/ the circulaire on implementing the regulatory freeze (gel de la réglementation) is also inspired by the principles of better regulation. It calls for all new regulation to contribute to simplifying the existing stock and sets up a mechanism to avoid new regulatory burdens: new obligations must be offset by equivalent simplifications. The equivalence is to be judged both in quantitative and qualitative terms. To operate the scheme, RIAs are extended to most new regulatory drafts and a monitoring tool (by ministerial department) will be set up. RIA will specially target gold-plating and seek "proportionality" now defined as allowing flexible (smart) implementation according to "specific situations". Common commencement dates and a time lag granted for compliance measures will also reinforce "legal security."

Smart regulation in support of competitiveness and SME's

The incoming rotating presidency of the EU Council (Lithuania, from July) hosted on 5-7 June the semi-annual meeting of the directors and experts of better regulation (DEBR). This is a regular opportunity for experts from member states to informally exchange on recent developments and good practice, and discuss the EU smart regulation agenda and way forward. The organisers have just released the follow-up to this important meeting, by uploading the agenda and a good number of presentations on the website of the LT ministry of economy.

According to the organisers (unfortunately your blogger could not attend), delegates:

• heard how the methodologies for competitiveness proofing, full compliance costs and cumulative assessments are progressing;
• discussed the vital importance of communication to and with stakeholders, particularly business; and
• talked for the first time in this group about inspection, advice and enforcement – such a vital part of the regulatory life cycle.

There is a signficant amount of new material in the presentations, which will be very useful to experts, whether they were or not at the meeting. Most noteworthy, an update on the CAR methodology already presented at the Dublin meeting in December, a study of RIA in Germany, and of course the new subject in that forum: inspections (see also news from OECD, below).

The website also presents "Better Regulation in Lithuania" showing how it developped, on the basis of the administrative burden programme, into a major component of the business environmnent policy.

See also our "history of DEBR (2006-2010."

EC Smart Regulation to produce results by end 2013

On 29-30 May, the Competitiveness Council adopted draft conclusions on smart regulation, as a follow-up to the communication on “EU regulatory fitness” and the communication “Smart regulation: responding to the needs of SMEs”. The conclusions urge the implementation, by all actors involved, of measures contained in the communications leading to tangible reductions in the overall burden of regulation for businesses, especially small ones, as well as simplification for end-users.
They contain inter alia a new, balanced definition of Smart Regulation which "is about achieving benefits at minimum cost, and means ensuring that: the potential costs and benefits of non-regulation and non-action are considered; alternatives to regulation are considered; regulation is evidence-based, in particular by means of robust Impact Assessment, and fit for purpose; the principles of subsidiarity and proportionality are respected; administrative procedures are efficient; unnecessary costs are removed without undermining the policy goals of regulation; overlaps, inconsistencies and gaps are identified and removed; and both effectiveness and efficiency are reviewed on a regular basis.
This edition of the Conclusions is useful in that the Irish presidency has obtained a clear schedule of works till the end of this year: the text calls on the EC to publish "before the summer 2013 the results of its mapping exercise; and in the autumn all planned REFIT initiatives starting from the 2014 work programme, prioritising those arising from the ‘Top Ten’ consultation; and by end 2013 the results of the pilot fitness checks launched before 2012."
The six pages contain many other valuable developments.

US Administration reviews impact of federal regulations

The Office of Information and Regulatory Affairs (OIRA) has released its draft 2013 Report to Congress on the Benefits and Costs of Federal Regulations with a call for comments by the public by 31 July. "It also discusses regulatory impacts on State, local, and tribal governments, small business, wages, and economic growth. Chapter II offers recommendations for regulatory reform."

NL purple crocodile program

On 25 April 2013, the Dutch Watchdog on administrative burden (ACTAL) launched its agenda for 2013: ‘Towards tangible less regulatory pressure.’ ACTAL has organised a seminar to celebrate the event at Pulchri Studio the Hague. During the seminar a book containing essays on the quest to reduce regulatory red tape and methods to make regulation more effective will be presented to the Dutch Minister of the Interior, Mr. Plasterk. For more, see http://www.actal.nl/english/about-actal/
A ‘purple Crocodile’ has become the Dutch ‘Logo’ for the phenomenon of red tape and regulatory burden. The idea was taken from a TV-add (2010/2011) in which a parent – with child in hand – asks a swimming pool clerk seated behind a glass walled counter whether the purple crocodile (a swimming pool toy) his son lost that day is found. Although the purple crocodile is in plain view, and the child is pointing at it feverishly, the clerk refuses to take a look behind his back and tells the parent in an icy voice to fill out and file a lost and found form…. (from http://www.ial-online.org/)

SCM and compliance costs fine-tuned in Malta

Quite a few of our colleagues were lucky to attend, in sunny Valetta, a meeting of the Standard Cost Model (SCM) network. 22 countries and the European Commission gathered by invitation of the government of Malta to discuss current projects and future steps to perfect, on the basis of experience developped by front-runners, an improved regulatory costs methodology.
Opened by the Parliamentary Secretary Dr Michael Farrugia, the meeting heard presentations by the hosts who were able to show how much they had advanced towards a comprehensive Better Regulation agenda (see MTsite of the unit in charge) in line with European Commission guidelines, where regulatory burden reduction figures prominently. Dr. Paul DeBattista (BR unit) presented a new "Bureaucratic Cost Measurement" index which includes fees charged, if any, for permits and the cost of delays. Then several countries (GE, UK,NL, SE) and the Commission gave an update on their national experience, thus sharing best practice.
In the second part of the SCM Working Group meeting, the delegates actively participated in a workshop tackling the way forward for Compliance Costs. The discussion revolved round the issue of when a fully fledged Impact Assessment is required in estimating the impact of Compliance Costs. Here again, the organisers had selected the most relevant recent developments in European countries.

Save-the-date of next meeting: 20th September 2013 in Finland (by invitation).

NL ACTAL releases 2012 report on administrative burdens

(Official announcement) "2012 was Actal’s first full year in its new role. In the Regulatory Burden Audit, we assessed if and to what extent ministries have taken the regulatory burden effects into account properly and consistently in preparing new policy. We also issued ex ante opinions on planned legislation on the consequences of regulatory burden proposing less burdensome alternatives within the bills assessed. Signals from society also lead to various advices to tackle the regulatory burden in existing legislation. We believe our activities of last year can contribute to less regulatory burden for businesses, citizens and professionals, making more commitment possible. Our digital Annual Report 2012: Less regulatory burden, more commitment. gives an overview of all our activities and the most important developments of last year."

South Carolina promises regulatory reform

According to Enviro-BLR.com, South Carolina is launching a review of current regulatory burdens on businesses which will lead to formulating recommendations to relieve those burdens. A new Regulatory Review Task Force created by Governor executive order will evaluate reports submitted by agencies that identify current and proposed statutes, rules, regulations, and policies that are a burden on the state's economy. To that end, all cabinet agencies must submit a written report to the task force by May 15. Stakeholders are invited to comment on current and proposed statutes and regulations or any other state statute, rule, regulation, or policy proposed or implemented that may unduly burden businesses or employers.

North Carolina to review 22,500 regulations every 10 years

This blog cannot possibly keep track of all the regulatory reform initiatives taken by each of the states composing the USA, but the recent move by the North Carolina (NC) House of Representatives is worth mentioning for its ambitious technical content, bearing in mind the political balance in this state (see Economist, 15 Feb. 2013 "a state turns solidly Republican"). The new Regulatory Reform Committee discussed "a bill that would mandate an official review of every state rule with an eye toward eliminating redundant or burdensome regulations.The bill would require a review of the state's more than 22,500 administrative rules over the next four years with a periodic review every 10 years. The Department of Health and Human Services review, if the bill is passed, would be finished by 2016, followed by the Department of Environment and Natural Resources in 2017. All of the rules would be reviewed by 2019."

New figures concerning US regulatory costs

An interesting but highly critical study of the recent evolution of regulatory reform was published on 17 January by Free Enterprise. It quotes a study by the the American Action Forum showing that "$518 billion in new regulatory costs have been dropped on the economy in the last four years, nearly $216 billion in 2012 alone. Three big culprits are EPA, the Dodd-Frank financial reform law, and the health care law, and in 2013, expect more costly rules from each of them." The article also gives the example of mandated menu labeling (includig calorie count) for chain restaurants and "similar retail food establishments," including pizza franchises and grocery stores, that will cost $757 million, with figures taken from the Federal Registry RIA (enough to cut your appetite).

"Regulatory smorgasbord": US Unified Agenda

Observers in the US are not kind in their welcome to the late publication (21 December) of the semiannual regulatory plan of regulatory and deregulatory actions called "Unified Agenda". For a full description of the regulatory planning process, see the relevant OIRA pages. The American Action Forum examines the "regulatory smorgasbord" of over 2300 actions and estimates that it will generate high regulatory costs for the economy (possibly $123.2 billion in costs and 13.6 million hours in  paperwork burden).