Perceptions of MAF's regulatory impact on the grain and seed industry

Appendix 1 Quality Regulation Review

Published September 2007

In May 2006, Cabinet agreed to a review of regulatory frameworks to ensure that the regulatory environment for business is supportive of the Government’s economic transformation agenda [CAB Min (06) 18/3 refers].

The results of this review highlighted that the regulatory environment should be viewed as a complex, dynamic system that is influenced by ever-changing social, economic, cultural and environmental factors. It also highlighted that quality regulation is not determined at one point in time, but can be influenced at all stages in the lifecycle of regulations. The review showed that the way central government, local government, business and other stakeholders think about and deal with regulation is important in determining whether the objectives of the regulation are achieved.

The review highlighted that regulation can have both a positive and a negative impact on economic growth, productivity and innovation. An optimal regulatory environment maximises the positive outcomes, while minimising any negative outcomes. The appropriate approach to quality regulation is not just about "reducing regulatory compliance costs for businesses" or "cutting red-tape." It is about ensuring regulatory frameworks are based on sound analysis, adhere to the principles of good regulatory practice, and continue to be "fit for purpose" over time.

In this respect, the key findings of the review were:

  1. The need to consider the stock and flow of regulation, as well as all stages of the regulatory lifecycle. The review highlighted the importance of looking at both the stock of existing regulation and the flow of new regulation when thinking about the impact of regulation on economic growth. It also demonstrated that issues that determine the quality of regulatory frameworks and the overall regulatory environment can arise at all stages of the regulatory lifecycle8. In addition, the review showed that regulatory frameworks do not exist independently of one another, but can influence the effectiveness of other regulatory frameworks. As a result, there is a need to ensure that regulatory frameworks are consistent and compatible at the design stage as well as in implementation. In summary, when thinking about the link between quality regulation and economic growth, it is necessary to view the regulatory environment as a complex dynamic system, rather than a collection of independent and static regulations.
  2. Implementation is as important as design. A number of the issues raised by business during the review related to the way regulations are implemented, rather than the regulation’s purpose or design. Concerns related to implementation by both local government and central government agencies, and included: inconsistent interpretation and application across regions and districts (where inconsistencies were not justified by regional or local differences); capability and capacity issues for regulators; issues relating to the quality of information provided about regulations and how this is communicated; and costs caused by delays and uncertainty. This demonstrated that in terms of ensuring positive outcomes for economic growth, the government should be as concerned about the implementation of regulation as it is with the decision to regulate and regulatory design.
  3. More can be achieved by working together. The resolution of a number of issues raised during the review required multiple government agencies to work together. Regulatory issues relating to duplication, excessive information requests and inconsistency often require input from more than one agency to resolve. For example, two of the interface projects9 specifically established processes to facilitate this, as did the consideration of issues relating to local authorities performance of their functions. Also, concerns about the cumulative impact of regulation on business can only be addressed effectively through a whole of government approach. The review also highlighted the need for central government to work with both local government and business to identify and implement workable solutions to regulatory issues at all stages of the lifecycle of regulation.
  4. Constant vigilance is critical. Good regulation is not only established at the design stage, but can be influenced throughout the entire lifecycle of regulation. For example, as the broader economic, social and regulatory environment changes, regulations can become obsolete, compliance information can become outdated, and duplication, overlap and inconsistencies can be created. It is important to ensure that the focus on quality regulation is not lost following decisions about the need for, and shape of, regulation. If a quality regulatory environment is to be maintained, government and business must be committed to a culture of constant vigilance and continuous improvement of regulatory frameworks.
  5. Fixes for poor regulatory outcomes are diverse, with no "one size fits all". The review highlighted that there are a number of things that can be done to improve regulatory outcomes for business if government agencies are prepared to be innovative, and take an open-minded approach to working with business. Finding a solution doesn’t always require considering legislative amendment, and other solutions adopted as part of the review included changes to departmental administrative processes and procedures, communication and information dissemination initiatives and the inclusion of issues in existing departmental reviews or work programmes. It is also possible to avoid problems for business at the regulatory design stage by adopting best practice techniques, such as undertaking effective consultation and considering options around regulatory flexibility.

Taking these factors into consideration, it is proposed that the Government’s post-review approach to ensuring the quality of New Zealand’s regulatory environment focus on the following four objectives:

  1. Ensuring the quality of new regulation;
  2. Improving the quality of existing regulation;
  3. Developing a culture of good regulatory practice; and
  4. Building the capability of regulators and of business.

8 The lifecycle of regulation can be thought of as: problem identification; regulatory design; regulatory decisions; implementation; monitoring and enforcement; and regulatory review.

9 The interface between the Health and Safety in Employment Act 1992 (HSE), the Injury Prevention, Rehabilitation and Compensation Act 2001 and the Hazardous Substances and New Organisms Act 1996, and between building and resource consents processes.

Contact for Enquiries

MAF Information Services
Pastoral House
25 The Terrace
PO Box 2526
Wellington, NEW ZEALAND

Fax: +64 4 894 0721
Contact this person

 
Print this page Print this page




WebSite survey