Best practice regulation report 2006-07

Annual report series

This report was released on 21 December 2007. It forms part of the Commission's annual report series for 2006-07.

The report was prepared by the Office of Best Practice Regulation (OBPR) which has now moved to the Finance and Deregulation portfolio. Future reports assessing best practice regulation will be available from the OBPR website.

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Key points
Media release
Contents

The past year was a milestone for regulatory governance in Australia. In November 2006, implementation of the Commonwealth Government's enhanced regulatory governance arrangements commenced. Responding to an independent Regulation Taskforce, the Government introduced the enhanced regulation-making framework to improve the analysis of regulatory proposals and the quality of regulation.
- The Council of Australian Governments also strengthened its regulatory impact analysis requirements for national regulation making and agreed on similar requirements in the states and territories.
Measures to improve the quality of new regulation at the Commonwealth level include: strengthened requirements to assess costs (including business compliance costs), benefits and risks; adoption of a whole-of-government consultation policy; and strengthened gate-keeping arrangements.
Review mechanisms have also been introduced to examine and improve the stock of existing regulation.
Some implementation issues included:
- clarifying the scope of the new arrangements
- providing guidance on best practice consultation processes
- aligning regulatory impact analysis requirements for tax measures with other
- regulatory proposals.
To support effective implementation, the OBPR commenced an education and training campaign to ensure that policy officers and other stakeholders are aware of the new requirements.
- Each department and agency has appointed a senior officer to champion sound policy development processes. These 'Best Practice Regulation Coordinators' are helping to ensure the effective adoption of the enhanced regulatory framework.
In 2006-07, compliance with the Government's regulatory impact analysis requirements at the decision-making stage for regulation was higher than in previous years.
- Under the previous RIS requirements, 54 adequate RISs were prepared of 63 required, resulting in a compliance rate of 86 per cent (compared with an average of 80 per cent over the previous three years).
- Under the enhanced requirements, two separate assessments of business compliance costs were prepared of two required and 15 adequate RISs were prepared of the 16 required, resulting in a compliance rate of 94 per cent. There were also two proposals granted exceptional circumstance status.
Under the Council of Australian Government's regulatory impact analysis requirements, 31 adequate RISs were prepared of the 33 required at the decision-making stage, resulting in a compliance rate of 94 per cent.

The first 'report card' on the operation of the Commonwealth's enhanced processes for making and reviewing regulation, was released today by the Productivity Commission. The Best Practice Regulation Report 2006-07 found that significant progress had been made in the transition year, with relatively high rates of compliance by most government departments and regulatory bodies.

The new arrangements came into effect on a transitional basis in November 2006, in response to recommendations by the Regulation Taskforce chaired by Gary Banks. Key features include more rigorous requirements for assessing business compliance costs, a whole-of-government policy on consultation and strengthened gate-keeping arrangements. Agencies are being assisted, and their compliance monitored, by the Office of Best Practice Regulation (OBPR), which replaced the Office of Regulation Review and has been given a wider remit.

Implementation of the arrangements was overseen by a group of senior officials from key agencies, who signed off on a new Handbook detailing and explaining the best practice requirements.

In the early part of 2006-2007, the rate of compliance with the previous Regulation Impact Statement requirements was 86 per cent, slightly up on the previous year.

Under the new arrangements, the formal compliance rate recorded was 94 per cent, with a Regulation Impact Statement not prepared for one significant regulatory proposal. In addition, two regulatory proposals were granted exceptional circumstances status. Under the new rules all three regulations are required to undergo post-implementation reviews within one to two years.

For regulations made by ministerial councils and national standard-setting bodies, the rate of compliance with similar COAG requirements in 2006-07 was 94 per cent, well up on the 76 per cent rate achieved the year before.

Background information

02 6240 3330

Preliminaries
Cover, Copyright, Foreword, Contents and Abbreviations
Overview - including key points
Chapter 1 Major initiatives to improve regulation
1.1 Improving the quality of new regulation
1.2 Improving the stock of existing regulation
Chapter 2 Implementation issues and challenges
2.1 Implementation challenges
2.2 Moving forward
Chapter 3 Compliance with best practice requirements
3.1 Role of the Office of Best Practice Regulation
3.2 Compliance with the Government requirements
3.3 National regulation making
Appendix A Compliance by portfolio
Appendix B Compliance by regulatory proposal
Appendix C Compliance with COAG RIS requirements
Appendix D OBPR activities and performance
Appendix E States and Territories
Appendix F Regulation review and reform: international perspectives
References

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