Yesterday Peter Strong the CEO of
COSBOA (Council of Small Business) put out an excellent article titled -
Helping Regulators Regulate Themselves - which many on here will truly be able to relate to...
A couple of quotes..
For some time we at
COSBOA have highlighted the attitude of regulators as one of the biggest red tape problems that we have, or perhaps had.
In the past, the approach from many regulators was based on an attitude among their staff and their management that small business people were the enemy. It seemed the prevailing belief was that the small business person was inadequate, we were always in the wrong, we were basically dishonest and untrustworthy as well as being poor business operators.
Unsurprisingly the small business community and its supporters had much the same view of regulators and many still do. All of this was of course not productive or conducive to good business or good regulation.
Then in 2012 the Productivity Commission (PC), mainly at the request of COSBOA, was tasked to investigate regulator engagement with small business. The
report was released in October last year and had an immediate impact.
One significant outcome of the report has seen the current Government task the PC to do a paper on a Regulator Audit Framework and this was
released on 19 March this year.
A new framework for assessment of regulator performance, a first for Australia, is under development by the Department of Prime Minister and Cabinet with strong advocacy and political leadership being provided by the Parliamentary Secretary to the Prime Minister Josh Frydenberg.
A
draft was released in early September.
The regulators will now be regulated. Excellent. This won’t get headlines as it doesn’t have much to do with big business but it is a game changer.
We in business have deep experience in dealing with compliance demands and we can help to make sure that the regulators themselves do not face over regulation and unnecessary demands.
We do not want the staff of the regulators just ticking boxes and following process for the sake of it, we also do not want regulators passing on extra costs from extra regulation to industry. What we need is cooperation between industry and regulators and a better understanding of each other’s needs.
If we can agree on what is good behaviour and process then we should be in a position to agree on how to best deal with those who flaunt the rules (and give the rest of us a bad name) and at the same time not unduly impact upon those, the majority, who are compliant.
This will be a game changer. The regulators will have no right to criticise all and sundry for the sake of a few.
The other change is on our side, the side of industry, with this framework in place the days of attacking regulators without facts will be gone. Constructive dialogue has to be both ways.
In the end the behaviour of regulators is a key issue for small business. It is not such an issue for big business as they have the resources to deal with the regulators and complex compliance.
The other great benefit will hopefully be the improved interaction between regulators and the policy makers. Policy and processes have to be achievable by regulators and by small business people alike.
If policy isn't developed properly then it can’t be professionally dealt with by the small business person or by the regulator.
This new framework is a constructive approach to better interaction between industry and government and the designers are to be congratulated.
Obviously, the Parliamentary Secretary to the Prime Minister Josh Frydenberg is making sure this gets through to a final product and more power to him. We know that Bruce Billson, the Minister for Small Business, is there as always advocating hard for small business. Nice.
As part of the Govt RTRP regulators are required to undertake an audit of all regulations and estimate the compliance cost for a cross section of those regulations. Apparently Fort Fumble (with absolutely no fanfare) have completed this (see
here) task and have now put their self-audit out for industry stakeholder comment...
This self-assessment process, with public scrutiny, is in accordance with the options as outlined in the Productivity Commission's -
Regulator Audit Framework (reference page 34).
However given that the 'trust factor' (as highlighted by the Reverend Forsyth) between FF & industry is at the lowest point in history; why should the IOS now be accepting of the veracity of the FF self-assessment and why should the IOS now believe that FF will in fact act on industry comment/review of this so called self-assessment audit??
The PC themselves highlight the risks involved with this option:
Regulator self-assessments
...As with the first model, a limitation of this approach is that there may be reduced impartiality and objectiveness, notwithstanding the fact that all vested interests should have been consulted on the indicators and metrics used to assess performance and the reports subject to their scrutiny. An external audit process to randomly check the reliability of the self-assessment would reduce the incentives for bias in self-assessment, as can the publication of the report...
And on the public scrutiny oversight option:
A complement to formal oversight responsibilities is exposure to public scrutiny. By publishing the audit plans and audit reports and providing an opportunity for public comment, such scrutiny can provide incentives for honest self-assessment. This form of quality assurance requires activist stakeholders, and can be subject to abuse by disgruntled people. However, if major costs are being imposed that could be reduced by better performance, businesses should have an incentive to monitor the audit plans and reports and to report when they perceive that the plans are inadequate or the audit falls short of an accurate reflection of regulator behaviour.
Hmm..it seems to me that there is still ample opportunity for FF to bury or water down this complement to oversight, the signs are already there when comment is being sent to an internal email address...
Perhaps a way around this would be to forward to one of the applicable contacts from the RTRP crew, see here: Cutting Red Tape
Moving on and while on the RTRP crew I note that Josh Frydenberg released a joint MR with PM Tony today that should also be of particular interest to many on here..:
Further Measures to Cut Red Tape - Accepting Trusted International Standards
Published: Tuesday, 14 October 2014
Joint Press Release
Hon Tony Abbott MP, Prime Minister
Hon Josh Frydenberg MP, Parliamentary Secretary to the Prime Minister
As part of the Industry Innovation and Competitiveness Agenda, the Government will examine opportunities for greater acceptance of international standards and risk assessments.
This is an important part of the Government’s plan to cut red tape and foster a lower cost, business friendly environment with less regulation.
Businesses often have to undertake a regulatory approvals process to use or sell products in Australia that duplicates a process that has already occurred in other developed countries. This adds to costs and provides little or no additional protection.
The Government will adopt a new principle that if a system, service or product has been approved under a trusted international standard or risk assessment, then our regulators should not impose any additional requirements for approval in Australia, unless it can be demonstrated that there is a good reason to do so.
This will remove regulatory duplication, reduce costs and delays for businesses and consumers, increase the supply of products into the Australian market and allow regulatory authorities to focus on higher priorities.
As an important first step, the Government will enable Australian manufacturers of medical devices the option of using European Union certification in place of TGA certification. This will place Australian manufacturers on the same footing as overseas competitors.
The Government will also require the National Industrial Chemicals Notification and Assessment Scheme (NICNAS) to increase its acceptance of international risk assessments of industrial chemicals made by reputable international regulatory authorities such as the European Union regulator.
To ensure a thorough review of all regulations, ministers will write to regulators in their portfolio and work with stakeholder groups to develop criteria for assessing opportunities for the acceptance or adoption of trusted standards and assessments.
Examples of unnecessary divergence from international standards can be submitted at the cuttingredtape.gov.au website.
Any changes will be subject the Government’s regulation impact statement processes and progress will be reported at the twice yearly repeal days and in the annual deregulation report.
These reforms build on the Government’s $700 million cut to red and green tape since coming to office including the removal of around 10,000 pieces of unnecessary legislation and regulations.
MTF..
