Transcript An Idea Whose Time Has Come: A Regulatory Budget And

An Idea Whose Time Has Come:
A Regulatory Budget And
Strategic Regulatory Agenda
Presented by Professor Bruce Doern
School of Public Policy and Administration, Carleton University
and Politics Department, University of Exeter (UK)
Halifax, Nova Scotia, September 29-30, 2008
Introduction and Overall Purposes

To outline and comment on recent commitment of
British government to a regulatory budget

To compare the UK development to my argument for an
annual strategic federal regulatory agenda in Canada
(drawing on my recent book for the Conference Board
of Canada)
See Bruce Doern, Red Tape, Red Flags: Regulation for the Innovation Age
(Conference Board of Canada, 2007)

To relate both to U.S. debate and ideas on regulatory
budget that were never adopted
The British Commitment To A Regulatory
Budget (A Cap On Private Sector Costs Of
New Regulations Over A Defined Period)

Emerged in 2008 with Prime Ministerial backing

Process to be led by Department of Business Enterprise
and Regulatory Reform (BERR)

Designed for 2009 start-up trial run and fully operational
in 2010

Consultation process underway at present
The UK System as a Whole

British Cabinet would set Reg budgets by department
but with eye out for horizontal items such as climate
change

Reg budget period would be 3 to 5 years

UK regular spending budget already has 3 year cycle

Flexibility will be built in across and within years,
among departments and with regard to exceptional
circumstances

Documents to date do not systematically discuss the
nature or dynamics of politics of agenda-setting
implied in the Reg budget idea
Issues Of Scope

Include all the costs associated with regulation that have
an impact on a business or third sector organization

Rules governing public service provision (internal
regulation) will not be included

Regulations originating in EU will be covered

Economic or independent regulators will not be included

Regulation will be defined to include statutes and
delegated law (the Regs) but not guidelines and codes
UK Methodological Issues

UK proposed that Reg budgets take account of direct
and indirect costs as well as benefits, including possible
unintended effects, and across all sectors of the
economy

Budgets to be set on gross cost estimates of regulation
(i.e. estimated benefits will not be netted off from gross
estimates for the purpose of setting budgets

Information from “RIAS” on proposed new Regs will
provide underpinning
Regulatory Budget Debates In
United States

Late 1970’s studies by U.S. Office of management and budget:
ceiling on new regulation compliance costs

Linked to ultimate achievement of full and complete fiscal
budget (Regs are “off-budget” mandated spending imposed on
businesses and private sector overall)

Reg budget never adopted in U.S. for reasons of lack of data
on costs, stakeholder concerns, and lack of political will in
“separation of powers” political system

But some analytical use in negotiations over early 1990s
amendments to clean air act and safe drinking act

A strategic regulatory agenda in Government of Canada
Basic Nature and Context of My
Conference Board Book and Argument

Current realities of complex multi-agency “regimes” of regulation
rather than one regulator at a time

Rapid changes in technology and knowledge

Need to better manage and rank risks and risk-benefit opportunities

Changing nature of science-based regulation in government

Did not discuss regulatory budget but did advocate need for annual
strategic regulatory agenda and analyzed dynamics and politics of
such an agenda

Recommend related institutional reform: a regulatory and risk
review commission (to review regulatory developments from new
technologies, compare and assess risks and develop and publish
better regulatory data)
Nature and Limits of Current
Federal Regulatory Policy

The limits of the “one regulation at a time” approach

The limits of the periodic regulatory reform approach

Recent changes but still “one regulation at a time”
E.g. directive on streamlining regulation and life cycle approach

Comparison with tax and spending systems which do
have an annual strategic agenda
To What Extent Does Regulatory
Agenda-Setting Occur Now?

The agenda setting that goes on within departments that have major sciencebased regulatory tasks and within other particular regulatory bodies; hidden and
not aggregated.

The RIAS process within departments: is it a latent agenda-setting system?
Potentially an aid but certainly not at present.

Departmental reports on plans and priorities, which are submitted during the
annual expenditure process; some regulatory initiatives noted but mainly about
spending.

The Throne Speech and related priorities regarding legislative bills that go before
the House of Commons; some periodic regulatory content but mainly key overall
policy themes and values are communicated.

The recent launch of an experimental “triage” process, whereby departments are
invited on to differentiate high, medium and low priorities for regulations, which
will then receive different levels of regulatory focus and resource support. Implies
some kind of partial priority-setting but not aggregated across government.
What Would A Reg Agenda Look
Like?


A process whereby all proposed new regulations from across federal departments
and agencies would be aggregated annually and priorities determined at the
Cabinet level;
A determination of what would be included as proposed new “regulations”; laws?
Delegated law (the “Regs”)? Guidelines? Standards and codes?

A provision and processes for handling contingencies and emergencies requiring
new regulations;

An appreciation of the many possible criteria that might legitimately be used to
distinguish high-priority from low-priority new regulations; (current tax and
expenditure agenda-setting faces similar challenges but governments do have tax
and spending annual agendas despite these challenges)


An annual ministerial “regulatory agenda statement” and debate in the house of
commons; need for public debate and accountability
A consideration of whether such an agenda process should be a separate, standalone one, or one that is appended to the existing tax or spending agenda process
to avoid duplication in matters such as stakeholder consultation or for other
reasons.
Conclusions

The absence of a strategic regulatory budget and agenda is a serious macro gap in
overall governance and policy making

The British commitment means that the idea of a regulatory budget (and a strategic
agenda) has arrived

The British development has to date not examined what the actual politics of
agenda-setting will be under a Reg budget

Does the proposed Canadian Regulatory Agenda require a Reg budget to make it
work?

An annual Reg budget/agenda versus a multi-year Reg budget/agenda?

Opportunities for “gaming” in Reg budget


Can current micro-based “RIAS” analysis underpin the information needs for a reg
budget and a strategic agenda?
Micro cost-benefit analysis versus macro “cost-risk-benefit” regulatory agenda
based on analysis and the arts of political-economic judgment