Sixteenth Report - Principles of effective regulation
Select Committee
Public Accounts Committee
HC 176
15 September 2021
Government response
Treasury minutes: Government response to the Committee of Public Accounts on the Sixteenth report from Session 2021-22 · published 8 Nov 2021
Recommendations & Conclusions
18 results
2
Recommendation
Deferred
The Department and regulators have been slow to follow best practice in facilitating innovation.
Recommendation
The Department and regulators have been slow to follow best practice in facilitating innovation. The Government’s 2019 White Paper ‘Regulation for the 4th Industrial Revolution’ found that only 29% of businesses believed that government’s approach to regulation facilitates innovation. The …
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Government Response Summary
The government agrees with the recommendation to require regulators to engage with businesses and adopt regulatory sandbox approaches, but states it already encourages such innovation and will consider how to build upon this after responding to a consultation that closed in October 2021.
HM Treasury
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3
Recommendation
Deferred
Regulators may fail to protect citizens, businesses and the environment if they do not successfully...
Recommendation
Regulators may fail to protect citizens, businesses and the environment if they do not successfully adapt to major changes in their sectors. To remain effective, 6 Principles of effective regulation regulators must adapt and respond to change. Rapid technological development …
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Government Response Summary
The government agrees with the recommendation to ensure responsive frameworks and well-equipped regulators, but outlines generic principles and defers specific action, pending consideration of an ongoing consultation and future publication of a detailed response.
HM Treasury
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4
Recommendation
Deferred
Regulatory bodies do not have a good enough understanding of the costs and benefits of...
Recommendation
Regulatory bodies do not have a good enough understanding of the costs and benefits of regulation, risking value for money. Robust analysis of the costs and benefits of regulatory activity is essential for effective regulation, value for money and accountability. …
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Government Response Summary
The government agrees with the recommendation to consult on and include proposals for robust analysis of regulatory costs and benefits, stating this work is underway as part of a consultation which closed in October 2021, and that its proposals will be set out in the consultation response.
HM Treasury
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5
Recommendation
Not Addressed
Outcomes-based regulation comes with benefits, but also presents challenges for regulators in measuring their influence...
Recommendation
Outcomes-based regulation comes with benefits, but also presents challenges for regulators in measuring their influence and compliance by industry. In general, setting goals and facilitating business to meet them can be both a more effective and a less burdensome approach …
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Government Response Summary
The government's response is completely irrelevant to the committee's recommendation regarding outcomes-based regulation and data collection, instead discussing the BBC's audience decline.
HM Treasury
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1
Conclusion
Not Addressed
On the basis of a report by the National Audit Office, we took evidence from...
Conclusion
On the basis of a report by the National Audit Office, we took evidence from the Department for Business, Energy and Industrial Strategy (the Department), and from the Environment Agency, the Health and Safety Executive (HSE) and the Office of …
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Government Response Summary
The government's response is an introductory statement that acknowledges the committee's process of taking evidence and publishing its report, serving as an introduction to the government's full response.
HM Treasury
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6
Recommendation
Acknowledged
We asked the Department how lessons from the regulatory response to the pandemic, including effective...
Recommendation
We asked the Department how lessons from the regulatory response to the pandemic, including effective cooperation between regulators, could be embedded in the regulatory system. It told us that encouraging dialogue between regulators and with ministers was important, and highlighted …
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Government Response Summary
The government agrees, stating BEIS has already learned from pandemic responses and will build upon this at an early 2022 meeting of the Regulators' Forum, while integrating lessons into ongoing regulatory reform via a current consultation.
HM Treasury
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7
Conclusion
Not Addressed
The Government’s 2019 White Paper ‘Regulation for the 4th Industrial Revolution’ found that only 29%...
Conclusion
The Government’s 2019 White Paper ‘Regulation for the 4th Industrial Revolution’ found that only 29% of businesses believed that “government’s approach to regulation facilitates innovative products and services being efficiently brought to market”.9 The Department explained that enabling innovation and …
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Government Response Summary
The government's response addresses a related recommendation about requiring regulators to adopt innovation-friendly approaches like sandboxes, but does not directly engage with this conclusion expressing surprise that sandboxes are not a default model.
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8
Conclusion
The Department told us that the UK is ranked highly in terms of regulatory policy...
Conclusion
The Department told us that the UK is ranked highly in terms of regulatory policy and competitiveness by international bodies such as the OECD, the World Bank and the World Economic Forum (WEF). We heard that the Department seeks to …
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9
Conclusion
Not Addressed
Rapid technological development is altering traditional business and commerce, the climate emergency is driving changes...
Conclusion
Rapid technological development is altering traditional business and commerce, the climate emergency is driving changes in business and consumer behaviour, and changing social attitudes are shifting citizens’ expectations of regulators. The UK’s exit from the EU has also created both …
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Government Response Summary
The government's response addresses a related recommendation about ensuring regulatory frameworks are responsive to major changes and post-EU departure opportunities, outlining principles from a consultation, but does not directly engage with this conclusion detailing the drivers of change.
HM Treasury
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10
Conclusion
Not Addressed
Ofcom, the Environment Agency and the HSE all stated that mitigating the risks and maximising...
Conclusion
Ofcom, the Environment Agency and the HSE all stated that mitigating the risks and maximising the opportunities of change in their sectors as a key challenge for them as regulators. For Ofcom, new technology has disrupted traditional business models and …
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Government Response Summary
The government's response addresses a related recommendation about regulatory frameworks adapting to post-EU changes, outlining principles from a consultation, but does not specifically engage with this conclusion detailing challenges faced by individual regulators.
HM Treasury
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11
Conclusion
Not Addressed
To meet these challenges and opportunities, regulators need to recruit and retain the right staff,...
Conclusion
To meet these challenges and opportunities, regulators need to recruit and retain the right staff, collaborate effectively both domestically and internationally, and exploit new technology to improve their efficiency and effectiveness. Ofcom has recruited a new chief technology officer from …
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Government Response Summary
The government's response addresses a related recommendation about regulatory frameworks adapting to post-EU changes, outlining principles from a consultation, but does not specifically engage with this conclusion regarding regulator staffing, collaboration, and technology use.
HM Treasury
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12
Conclusion
Not Addressed
The Department views its role as supporting coordination and dissemination of best practice across the...
Conclusion
The Department views its role as supporting coordination and dissemination of best practice across the regulatory system. However, it told us it is the responsibility of individual sponsoring departments to provide appropriate governance of regulatory bodies, including oversight of value …
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Government Response Summary
The government's response mentions agreeing to an unprovided recommendation, discussing learning from the COVID-19 pandemic and future regulatory reform consultations, but does not directly address this conclusion about the Department's view of its role in regulatory oversight.
HM Treasury
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13
Conclusion
Not Addressed
Robust performance measurement and evaluation, including analysis of the costs and benefits of regulatory activity,...
Conclusion
Robust performance measurement and evaluation, including analysis of the costs and benefits of regulatory activity, are essential for effective regulation. They can help evidence value for money, provide insight into unintended outcomes, and help to refine interventions to improve outcomes. …
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Government Response Summary
The government's response addresses a related recommendation about the Business Impact Target and regulatory cost/benefit analysis, but does not specifically engage with this conclusion regarding the importance of robust performance measurement and evaluation.
HM Treasury
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14
Conclusion
Not Addressed
We questioned Ofcom, the Environment Agency and the HSE on the extent to which they...
Conclusion
We questioned Ofcom, the Environment Agency and the HSE on the extent to which they are able to capture the cost of their regulations on their sectors. Ofcom told us it is stepping up its efforts to measure its impact …
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Government Response Summary
The government's response addresses a related recommendation about the Business Impact Target and regulatory cost/benefit analysis, but does not specifically engage with this conclusion regarding regulator difficulties in capturing costs and benefits.
HM Treasury
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15
Conclusion
Not Addressed
The government’s Business Impact Target is set each Parliament and aims to reduce the costs...
Conclusion
The government’s Business Impact Target is set each Parliament and aims to reduce the costs of regulation to business. Regulators must carry out Regulatory Impact Assessments (RIAs) on qualifying regulations to determine their impacts on business. Where these assessments identify …
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Government Response Summary
The government's response addresses a related recommendation about the Business Impact Target and regulatory cost/benefit analysis, but does not specifically engage with the conclusion provided in this item describing the existing BIT and RIA process.
HM Treasury
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16
Conclusion
Accepted
The Department told us that RIAs currently consider the cost impact of regulations without an...
Conclusion
The Department told us that RIAs currently consider the cost impact of regulations without an adequate assessment of the benefits. For example, the costs of complying with gambling regulations for gambling companies are captured, but the benefits of those regulations …
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Government Response Summary
The government agrees with the need to better assess both costs and benefits of regulation, stating that work on reforming the Business Impact Target framework is already underway and was addressed through a public consultation.
HM Treasury
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17
Conclusion
Deferred
An outcomes-focused regulatory approach is one characterised by setting overall outcomes or principles expected of...
Conclusion
An outcomes-focused regulatory approach is one characterised by setting overall outcomes or principles expected of the regulated industry, rather than specifying rules. This has the benefit of often being more responsive to change because the regulatory objective or outcome remains …
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Government Response Summary
The government agrees with the underlying principle of balancing outcomes-based and rules-based regulation but defers specific action, indicating it will review responses to an ongoing consultation and publish its decisions later in 2021.
HM Treasury
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18
Recommendation
Not Addressed
An outcomes-focused approach, however, can present a challenge for regulators and policymakers in measuring the...
Recommendation
An outcomes-focused approach, however, can present a challenge for regulators and policymakers in measuring the influence or impact of regulation and the level of compliance by industry. A regulator’s influence over the industry it regulates—for example, how well businesses comply …
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Government Response Summary
The government provides a generic response about balancing regulatory approaches and referring to an ongoing consultation, but does not specifically address the imperative for regulators to robustly identify, collect, and act on data.
HM Treasury
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