Recommendation 2

HM Treasury will not know if the Action Plan has been successful, as it has not defined growth in any detail beyond an increase in GDP. We do not believe HM Treasury is clear on what success or failure of the Action Plan looks like. HM Treasury defined growth as an increase in GDP but has not defined the intended timeframe or set any targets. DBT and HM Treasury failed to demonstrate how regulation contributes to key drivers of GDP growth in their evidence. They did not speak to drivers such as trade and investment, or the clear need to see productivity improvements in regulated entities. These omissions matter, since government needs to be clear on 3 what growth it is seeking to deliver and when. Without this, HM Treasury’s definition of growth amounts to an ambiguous objective rendering success impossible to measure. While short-term growth might mean cutting prices in some areas, longer-term growth could require price increases to encourage investment. Select committees can play a role in holding regulators accountable for shifting the dial on growth, but it is ultimately up to DBT and HM Treasury to implement robust accountability measures to ensure regulators’ work increases GDP. recommendation HM Treasury should establish a time horizon for growth targeted by the Action Plan, including supplementary indicators (such as investment, the costs associated with investment in different sectors, and productivity). This would establish if the Action Plan is influencing factors that increase GDP and by how much.