Ideas@TheCentre
Covert methods to curb criticism
The government has found a rather creative way of limiting policy criticism. New changes to Regulatory Impact Statement (RIS) provisions will make it easier for successive governments to pass burdensome regulation without sound evaluation of their effects.
Since Bob Hawke’s reforms in the 1980s new regulatory proposals considered to be significant have had to include an RIS. The intention was to force governments to consider the impact that regulations have upon business and individuals and in turn would limit excessive and stifling regulation.
A number of changes are worrisome, particularly the fact that election promises are no longer are required to undergo a comparison with alternative policy options; they can simply be taken as given and their effects analysed. For policies that do require comparison, the government can direct which options they are compared against, effectively neutering the value of the comparison. Under the old arrangements an RIS needed to demonstrate that the option selected generated the greatest net benefit for the community - this condition is no longer required. We also find that an RIS can be modified after it is submitted for decision, but before publication, allowing the RIS to be altered to suit the government’s preference. New RISs will no longer have to consider the implications of regulations on “business and individuals” but rather, business and the non-for-profit sector allowing costs to individuals to go unassessed. Finally, RIS monitoring is no longer the responsibility of the Productivity Commission - which operates at arm’s length from the government - but in-house at the Department of Finance & Deregulation.
These changes effectively relegate the RIS procedure to a “Yes Minister” rubber stamp process. It is not likely to lead to immediate regulatory proliferation; instead, a less noticeable creeping of red tape will occur. Statements will still be released, and the appearance of sound review will continue, but scrutiny will be limited. The changes now make it easier for governments to impose regulations costly to business and individuals with little critical analysis.
Governments committed to a free society need to strengthen regulatory scrutiny, not weaken it.
Alexander Philipatos is a Policy Analyst with the Economics Program at The Centre for Independent Studies.
