Regulation and its review 2002-03

Annual report series

Regulation and its Review 2002-03 was released on 7 November 2003. The report forms part of the Commission's annual report series and meets its obligation to report annually on compliance by Australian Government departments and agencies with the Government's Regulation Impact Statement (RIS).

As in last year's report, RIS compliance information is provided for individual departments and agencies, with a focus on significant regulatory issues. The present volume also examines developments in regulatory policy in selected OECD countries.

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Key points
Media release
Contents

An important element of the Australian Government's regulatory policy is the requirement to prepare Regulation Impact Statements (RISs) for proposed new and amended regulation which affects business.

Many OECD countries have similar processes for improving the quality of regulations. Some countries have recently strengthened their requirements. The Australian Government's processes have a high degree of consistency with OECD best practice principles.

Overall, the compliance of departments and agencies in 2002-03 with the RIS requirements at the decision-making stage of policy development was lower than the previous year:

Adequate RISs were prepared for 81 per cent of 139 regulatory proposals (compared to 88 per cent in 2001-02).
Compliance for regulatory proposals assessed as having a more significant impact on business and the community was noticeably lower at 46 per cent (compared to 70 per cent in 2001-02).

As in previous years, compliance with the Government's RIS requirements varied considerably both among and within portfolios. While 12 departments and agencies achieved compliance rates of 100 per cent, 11 did not comply fully.

In 2002-03, some departments and agencies took steps to integrate more effectively the RIS requirements into their broader policy development processes. However, others continue to treat the RIS process largely as an 'add-on'.

Over the last five years, the average RIS compliance rate was 82 per cent. Of the 33 departments and agencies responsible for preparing RISs over this period, five were fully compliant in all years, with a further 17 being fully compliant in one or more years.

In 2002-03, compliance by Ministerial Councils and national standard-setting bodies with the Council of Australian Governments' RIS requirements was 89 per cent, down from 97 per cent in 2001-02.

Compliance with the Australian Government's regulatory best practice requirements was lower in the past year, according to a Productivity Commission report Regulation and its Review 2002-03.

The report provides detailed compliance information for individual departments and agencies. Over 1800 regulations were introduced by the Australian Government in 2002-03, with 139 regulatory proposals requiring preparation of a Regulation Impact Statement. Adequate Regulation Impact Statements were prepared for decision makers for 81 per cent of these proposals (compared to 88 per cent in 2001-02). As in previous years, compliance with the Government's Regulation Impact Statement requirements varied considerably among regulators.

Productivity Commission Chairman, Gary Banks, said 'The potential for the Regulation Impact Statement process to contribute to policy development has yet to be fully realised. Better compliance is needed for regulations with significant impacts on business and the community.'

The report also provides information on trends in compliance for individual regulators since 1998 and highlights the importance of effectively implementing well designed regulation.

The report meets the Productivity Commission's obligation to report annually on compliance with the Australian Government's requirements for the review and reform of regulations. Regulation Impact Statements are intended to help inform decision makers about the consequences of proposed regulatory actions, so that resulting regulation can achieve intended goals without placing undue burdens on business and the community.

The Commission's Office of Regulation Review is responsible for advising departments and agencies about the Government's regulatory best practice requirements.

Background information

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Preliminaries
Cover, Copyright, Foreword, Contents and Abbreviations
Overview - including key points
Chapter 1 Improving the quality of regulation
1.1 Regulatory policy
1.2 Regulatory policy in Australia
Chapter 2 Compliance with RIS requirements
2.1 Assessment of compliance
2.2 Compliance by type of regulation
2.3 National regulation making
Chapter 3 Compliance by portfolio
3.1 Agriculture, Fisheries and Forestry
3.2 Attorney-General's
3.3 Communications, Information Technology and the Arts
3.4 Defence
3.5 Education, Science and Training
3.6 Employment and Workplace Relations
3.7 Environment and Heritage
3.8 Foreign Affairs and Trade
3.9 Health and Ageing
3.10 Immigration and Multicultural and Indigenous Affairs
3.11 Industry, Tourism and Resources
3.12 Prime Minister and Cabinet
3.13 Transport and Regional Services
3.14 Treasury
3.15 Jointly-sponsored proposals
Chapter 4 Compliance trends since 1998
4.1 Overall compliance
4.2 Compliance by department and agency
4.3 Improving compliance
Chapter 5 Effective implementation
5.1 Encouraging compliance
5.2 Improving implementation
Appendix A Compliance with COAG Principles and Guidelines
Appendix B Australian Government legislation reviews
Appendix C ORR activities and performance
Appendix D Developments in States and Territories
Appendix E International developments
References

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