Recommendations & Conclusions
18 items
2
Conclusion
Sixteenth Report - Principles of effect…
The Department and regulators have been slow to follow best practice in facilitating innovation. The Government’s 2019 White Paper ‘Regulation for the 4th Industrial Revolution’ found that only 29% of businesses believed that government’s approach to regulation facilitates innovation. The Department aims to promote innovation in various ways, primarily through …
Government response. 2: PAC conclusion: The Department and regulators have been slow to follow best practice in facilitating innovation. 2: PAC recommendation: Government should require regulators to engage meaningfully with businesses to explore potential new ideas and innovations and adopt regulatory sandbox …
HM Treasury
3
Conclusion
Sixteenth Report - Principles of effect…
Regulators may fail to protect citizens, businesses and the environment if they do not successfully adapt to major changes in their sectors. To remain effective, 6 Principles of effective regulation regulators must adapt and respond to change. Rapid technological development is disrupting traditional business models, the climate emergency is driving …
Government response. 3: PAC conclusion: Regulators may fail to protect citizens, businesses and the environment if they do not successfully adapt to major changes in their sectors. 3: PAC recommendation: Government and regulators should work together to ensure that regulatory frameworks are …
HM Treasury
4
Conclusion
Sixteenth Report - Principles of effect…
Regulatory bodies do not have a good enough understanding of the costs and benefits of regulation, risking value for money. Robust analysis of the costs and benefits of regulatory activity is essential for effective regulation, value for money and accountability. The regulators we questioned were not able to put a …
Government response. 4: PAC conclusion: Regulatory bodies do not have a good enough understanding of the costs and benefits of regulation, risking value for money. 4: PAC recommendation: In its review of the Business Impact Target, the Department should consult with regulatory …
HM Treasury
5
Conclusion
Sixteenth Report - Principles of effect…
Outcomes-based regulation comes with benefits, but also presents challenges for regulators in measuring their influence and compliance by industry. In general, setting goals and facilitating business to meet them can be both a more effective and a less burdensome approach to meeting regulatory objectives than laying down lists of rules. …
Government response. 1. The BBC appears complacent about the threat it faces from declining audiences. Each year people spend less time watching BBC TV and 200,000 more households choose to opt out of paying for the licence fee. Yet when pressed, the …
HM Treasury
1
Conclusion
Sixteenth Report - Principles of effect…
On the basis of a report by the National Audit Office, we took evidence from the Department for Business, Energy and Industrial Strategy (the Department), and from the Environment Agency, the Health and Safety Executive (HSE) and the Office of Communications (Ofcom).1
Government response. Based on a report by the National Audit Office, the Committee took evidence on 14 June 2021 from the Department for Business, Energy & Industrial Strategy. The Committee published its report on 15 September 2021. This is the government’s response …
HM Treasury
6
Conclusion
Sixteenth Report - Principles of effect…
We asked the Department how lessons from the regulatory response to the pandemic, including effective cooperation between regulators, could be embedded in the regulatory system. It told us that encouraging dialogue between regulators and with ministers was important, and highlighted its role in convening regulatory forums such as a regulators’ …
Government response. 1: PAC conclusion: The response to the COVID-19 pandemic has shown what can be achieved when regulatory bodies work effectively together with a clear focus on outcomes. 1: PAC recommendation: The Department should identify what has facilitated effective regulatory cooperation …
HM Treasury
7
Conclusion
Sixteenth Report - Principles of effect…
The Government’s 2019 White Paper ‘Regulation for the 4th Industrial Revolution’ found that only 29% of businesses believed that “government’s approach to regulation facilitates innovative products and services being efficiently brought to market”.9 The Department explained that enabling innovation and innovative sectors to grow has been a central plank of …
Government response. 2: PAC conclusion: The Department and regulators have been slow to follow best practice in facilitating innovation. 2: PAC recommendation: Government should require regulators to engage meaningfully with businesses to explore potential new ideas and innovations and adopt regulatory sandbox …
HM Treasury
8
Conclusion
Sixteenth Report - Principles of effect…
The Department told us that the UK is ranked highly in terms of regulatory policy and competitiveness by international bodies such as the OECD, the World Bank and the World Economic Forum (WEF). We heard that the Department seeks to learn from 5 Q 39 6 Q 40 7 Q …
HM Treasury
9
Conclusion
Sixteenth Report - Principles of effect…
Rapid technological development is altering traditional business and commerce, the climate emergency is driving changes in business and consumer behaviour, and changing social attitudes are shifting citizens’ expectations of regulators. The UK’s exit from the EU has also created both risks and opportunities, as the UK takes on new regulatory …
Government response. 3: PAC conclusion: Regulators may fail to protect citizens, businesses and the environment if they do not successfully adapt to major changes in their sectors. 3: PAC recommendation: Government and regulators should work together to ensure that regulatory frameworks are …
HM Treasury
10
Conclusion
Sixteenth Report - Principles of effect…
Ofcom, the Environment Agency and the HSE all stated that mitigating the risks and maximising the opportunities of change in their sectors as a key challenge for them as regulators. For Ofcom, new technology has disrupted traditional business models and it is seeing a growth in the reach and power …
Government response. 3.1 The government agrees with the Committee’s recommendation. Target implementation date: Winter 2021 3.2 As outlined in the consultation on Better Regulation that closed on 1 October 2021, the government has set out five principles that will underpin the approach …
HM Treasury
11
Conclusion
Sixteenth Report - Principles of effect…
To meet these challenges and opportunities, regulators need to recruit and retain the right staff, collaborate effectively both domestically and internationally, and exploit new technology to improve their efficiency and effectiveness. Ofcom has recruited a new chief technology officer from industry and told us that recruiting the right skills was …
Government response. 3.1 The government agrees with the Committee’s recommendation. Target implementation date: Winter 2021 3.2 As outlined in the consultation on Better Regulation that closed on 1 October 2021, the government has set out five principles that will underpin the approach …
HM Treasury
12
Conclusion
Sixteenth Report - Principles of effect…
The Department views its role as supporting coordination and dissemination of best practice across the regulatory system. However, it told us it is the responsibility of individual sponsoring departments to provide appropriate governance of regulatory bodies, including oversight of value for money.23 It also confirmed that government has a role …
HM Treasury
13
Conclusion
Sixteenth Report - Principles of effect…
Robust performance measurement and evaluation, including analysis of the costs and benefits of regulatory activity, are essential for effective regulation. They can help evidence value for money, provide insight into unintended outcomes, and help to refine interventions to improve outcomes. Good monitoring and reporting can also support accountability to Parliament …
Government response. 4.1 The government agrees with the Committee’s recommendation. Target implementation date: Winter 2021 4.2 This work is already underway and reforming the Business Impact Target to accurately capture the impacts of regulation is a fundamental part of the “Reforming the …
HM Treasury
14
Conclusion
Sixteenth Report - Principles of effect…
We questioned Ofcom, the Environment Agency and the HSE on the extent to which they are able to capture the cost of their regulations on their sectors. Ofcom told us it is stepping up its efforts to measure its impact since this committee’s 2019 report. But it also set out …
Government response. 4.1 The government agrees with the Committee’s recommendation. Target implementation date: Winter 2021 4.2 This work is already underway and reforming the Business Impact Target to accurately capture the impacts of regulation is a fundamental part of the “Reforming the …
HM Treasury
15
Conclusion
Sixteenth Report - Principles of effect…
The government’s Business Impact Target is set each Parliament and aims to reduce the costs of regulation to business. Regulators must carry out Regulatory Impact Assessments (RIAs) on qualifying regulations to determine their impacts on business. Where these assessments identify an impact of more than £5 million, the analysis underpinning …
Government response. 4.1 The government agrees with the Committee’s recommendation. Target implementation date: Winter 2021 4.2 This work is already underway and reforming the Business Impact Target to accurately capture the impacts of regulation is a fundamental part of the “Reforming the …
HM Treasury
16
Conclusion
Sixteenth Report - Principles of effect…
The Department told us that RIAs currently consider the cost impact of regulations without an adequate assessment of the benefits. For example, the costs of complying with gambling regulations for gambling companies are captured, but the benefits of those regulations in reducing crime are not. Similarly, the costs to landlords …
Government response. 4.1 The government agrees with the Committee’s recommendation. Target implementation date: Winter 2021 4.2 This work is already underway and reforming the Business Impact Target to accurately capture the impacts of regulation is a fundamental part of the “Reforming the …
HM Treasury
17
Conclusion
Sixteenth Report - Principles of effect…
An outcomes-focused regulatory approach is one characterised by setting overall outcomes or principles expected of the regulated industry, rather than specifying rules. This has the benefit of often being more responsive to change because the regulatory objective or outcome remains the same even where the process or activity being regulated …
Government response. 5.1 The government agrees with the Committee’s recommendation. Target implementation date: Winter 2021 5.2 Key to ensuring a proportional approach is recognising what is necessary in each instance. There will be sectors and circumstances where market freedom and an outcomes- …
HM Treasury
18
Conclusion
Sixteenth Report - Principles of effect…
An outcomes-focused approach, however, can present a challenge for regulators and policymakers in measuring the influence or impact of regulation and the level of compliance by industry. A regulator’s influence over the industry it regulates—for example, how well businesses comply with standards—can be difficult to measure, particularly if there are …
Government response. 5.1 The government agrees with the Committee’s recommendation. Target implementation date: Winter 2021 5.2 Key to ensuring a proportional approach is recognising what is necessary in each instance. There will be sectors and circumstances where market freedom and an outcomes- …
HM Treasury