Next June, the Regulatory Impact Assessment (RIA) process will have been in operation for a dozen years in Ireland. It was June 2005 when the then Government decided that the RIA process should be introduced to evaluate all new regulations in all Government departments and offices. Regulations include any laws (or other official rules) that affects people and businesses. As the name suggests, RIA is a technique used to help produce better regulations or to identify if there are better, cheaper or more constructive ways of taking action, or solving a problem. This blog will look at possible changes to the RIA process.
Why produce RIAs?
RIAs are needed to underpin good laws and regulations that help to protect citizens’ rights, promote a safer society and ensure more confidence in goods and services. But before drafting such laws and regulations, there is a need to establish what the best course of action is. This requires an assessment of alternative solutions; measuring the costs and benefits of different options, undertaking consultation with interested parties and recommending a “best option”. Taken together, these elements provide a best practice approach to regulation. If well applied, the RIA process has an important role to play in facilitating the continuing development of a competitive economy. Of course, regulation may not always be the best option. Departments are expected to see if they actually need specific regulations, or whether there are alternative ways of achieving their objectives.
Have RIAs been produced?
The websites of most Departments show that they are meeting the commitment to publish their RIAs. However, in the case of many of the websites, it is necessary to dig deep to actually find published RIAs. Moreover, it is not always easy to ascertain if some regulatory proposals are presented without RIAs having been undertaken. Of course, it must be pointed out that there are circumstances where RIAs are not required. For example, a RIA is not required in the case of emergency legislation or in the case of the Finance Bill.
What is missing is the regular publication of an oversight table, listing the individual RIAs produced and published by individual Departments. Current Ceann Comhairle Sean Ó’Fearghaíl did help to fill the information gap at the end of 2015, when he tabled a Dáil Question, which was answered on 17 December 2015.[i] The reply shows that over 200 Bills were published during the period examined. RIAs were prepared for nearly half those Bills. In turn, over 93% of those RIAs were published on the relevant Departmental websites – for a fuller analysis see Ferris (2016)[ii].
And quality of RIAs?
The Organisation for Economic Cooperation and Development (OECD) carried out a survey in 2014, in which Ireland recorded a mixed performance in terms of RIAs. The survey related to the performance of 33 OECD Member States and the European Commission in the production of RIAs for primary legislation[iii].
In the survey, Ireland achieved an overall score of 53%, which placed it in 17th place out of 34 jurisdictions. As regards the constituent parts of the survey, Ireland’s performance varied considerably. It performed very well in terms of the systematic application of the methodology in Ireland, with a score of 80% and 12th place in the league of 34 jurisdictions. Under RIA methodology, it had a good score of 72% and was in 13th place in the league of 34 jurisdictions. As regards transparency, however, Ireland achieved a low score of 41% and 17th place in the league of 34 jurisdictions. The lowest score for Ireland was recorded for “oversight”, where the score was only 19% and our ranking was 27th place out of 34. Of course, it should be emphasised that these results relate to 2014. Perhaps our position has improved since then. However, there are no more up-to-date survey results available.
| Table A: OECD Survey of RIA Performance, for Primary Legislation, 2014
||Position (out of 34**)
1. Systematic adoption of Regulatory Impact Assessment, Primary laws
2. Methodology of Regulatory Impact Assessment, Primary law
3. Transparency of Regulatory Impact Assessment, Primary law
4. Oversight of Regulatory Impact Assessment, Primary law
5. Aggregate score for Regulatory Impact Assessment, Primary laws
*Categories 1 through 4 were scored out of ‘one’, and Category 5 was scored out of ‘four’
**Survey embraces 33 Member States and European Commission
|Source: OECD, 2014.
Available here: http://stats.oecd.org/Index.aspx?QueryId=69796
Have RIAs had an impact?
The RIA process has succeeded in moving Government Departments away from the traditional “regulate first” approach and towards having evaluations of different options done before regulatory decisions are made. However, this may not always be the situation. If Departments are merely “ticking boxes”, after legislative solutions have been chosen, it amounts to a little more than a waste of resources – unless the RIA impacts on the evolving legislation.
There is also more evidence of consultation being undertaken. This is a crucial part of the process. Under RIA, decisions need to be based on proposals that have been fully-evaluated, right through to the likely costs of compliance and enforcement. That work can be assisted where there is more widespread and systematic consultation. The Programme for a Partnership Government (2016) recognises that public consultations provide an important opportunity for the public to have direct input into matters that affect them and their communities. Accordingly, the Programme gives a commitment to
“… establish an easily accessible portal to provide details of all such public consultations”[iv].
While there is much to commend the current RIA system, there are improvements that can be made.
- Why not encourage Departments to carry out RIAs at an early stage? This should help in the design of good laws that will be effective, while not imposing unnecessary costs on citizens and businesses. The OECD put this point very succinctly in a report published in 2012: “Integrate Regulatory Impact Assessment (RIA) into the early stages of the policy process for the formulation of new regulatory proposals”[v].
- Why not install an RIA “gatekeeper”? Such a “gatekeeper” would be responsible for assessing the quality of individual RIAs and challenging proposals that are not accompanied by satisfactory RIAs. The EU’s Regulatory Scrutiny Board provides a good model for “gate keeping”[vi].
- And why not improve the visibility of RIAs? There is need to improve the visibility of RIAs. A central website, such as the one that has been developed by the Department of Public Expenditure and Reform for Value for Money Reviews (VFMs) would be of help to improve the visibility of the RIAs that are Details can be found of the VFM tracker here.
[i] Dáil Debate, Thursday 17 December 2015. Available here: http://oireachtasdebates.oireachtas.ie/debates%20authoring/debateswebpack.nsf/takes/dail2015121700001?opendocument
[ii] The Public Professional, Issue 1. 2016. Public Affairs Ireland. For more information, see here.
[iii] Government at a Glance: Regulatory governance. OECD. Available here: http://stats.oecd.org/Index.aspx?QueryId=69796
[iv] Programme for Government 2016. Available here: http://www.taoiseach.gov.ie/eng/Work_Of_The_Department/Programme_for_Government/A_Programme_for_a_Partnership_Government.pdf
[v] Recommendation of the Council on Regulatory Policy and Governance. OECD, 2012. Available here: http://www.oecd.org/governance/regulatory-policy/49990817.pdf
[vi] Members of the Regulatory Scrutiny Board. European Commission. Available here: http://ec.europa.eu/smart-regulation/impact/iab/members_en.htm