Inquiry into regulation will accrue benefits

The Productivity Commission’s inquiry into regulation is good news.

The Commission will review the state and extent of regulation in New Zealand and make recommendations by June 2014 on improving regulatory regimes.

The business community and the wider New Zealand community have been seeking improvement to regulation in New Zealand for some time.

Business productivity and economic growth is being held back by too many poorly designed regulations bringing unexpected and negative consequences.

There are too many regulators in different sectors imposing differing regulatory regimes. A more consistent approach to sector regulation would bring more efficiency and certainty.

Serious impact

Regulatory impact statements are meant to provide assurance that proposals for new legislation are cost-effective and justified, but in practice these are often lacking in rigour. New Zealand could benefit greatly from a regulatory responsibility act requiring adherence to a set of principles to achieve discipline in regulation making.

These and other issues deserve scrutiny by the Productivity Commission and the inquiry into regulation will have the full support of business.

Phil O’Reilly is Chief Executive of BusinessNZ based in Wellington

Our Staff Reporter adds:

The Government had asked the Productivity Commission to review the existing regulatory regime and recommend ways and means of improving government services and improve productivity in the public sector.

According to Murray Sherwin, the Commission’s Chair, the inquiry will examine the quality and effectiveness of the existing government regulations and their influence on the country’s productivity. It will assess the ways in which productivity can be improved for the overall wellbeing of the economy and the society.

The Government has also asked the Commission to identify the areas in which improvements can be made to achieve the objectives.

Not specific

Mr Sherwin said that the exercise was not an in-depth review of any specific regulation or regulator.

“However, by looking across our regulatory landscape and institutions, the Commission will be able to compare, contrast and draw inferences from the different approaches and contexts. We have a large number of different regulatory frameworks and institutional forms engaged in regulation in New Zealand. Individual regimes are periodically reviewed and amended and that is an essential part of any process of continuous improvement,” he said.

Futuristic approach

According to him, the inquiry will look across the diversity in New Zealand’s regulatory system with the aim of drawing conclusions and recommendations that will assist the future design of regulation and regulatory frameworks.

“Cross-cutting issues the inquiry will consider include regulatory design processes; checks and balances on regulation, including accountability mechanisms and the nature of appeal rights; capability; and how key stakeholders are involved in design and operation of regulation. We will also be keen to understand what issues and challenges are faced by regulators, regulated parties and other important stakeholders,” Mr Sherwin said.

He said that the demands on regulatory regimes are now more complex compared to the past and that adding unnecessary complexity into the regulators’ task would be self-defeating.

“The Government is asking the Commission to provide insights that will assist it to design and implement regulation that is clear about its intended purpose and how that purpose is best achieved,” Mr Sherwin said.

Photo :Murray Sherwin

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