Press Release - Evaluation of Regulatory Impact Assessments
2005-06
28 June 2006
Regulatory Impact Assessments (RIAs) are often not used in the
right way, according to a report published today by the National
Audit Office. The report finds that the purpose of RIAs is not
always understood, there is a lack of clarity in the presentation
of the analysis and persistent weaknesses in the assessments. As a
result, in many cases RIAs have not offered a robust challenge to
proposals to regulate.
This is the third evaluation of RIAs published by the National
Audit Office, this year expanded to look at the extent to which RIA
practice was integrated into departments’ culture. The report finds
that while there are areas of good practice, most notably from the
DTI, other departments have been slow to improve the quality of
RIAs and integrate them into the policy-making process. The report
makes recommendations for departments to improve their staff’s
awareness and use of assessments.
The NAO analysed a sample of RIAs from four government
departments – the Department of Trade and Industry, the Home
Office, the Department for Transport and the Department for
Culture, Media and Sport. The quality of RIAs was mixed, but
certain elements within them were generally undertaken well, such
as stakeholder consultation. The weakest area was the consideration
of the level of compliance with the proposed regulation, where
departments too often assume that new regulations will be fully
complied with and do not consider the impact of lower levels of
compliance. The NAO found weaknesses in how costs and benefits were
assessed. The NAO also found insufficient evidence of plans being
developed for successful implementation and that little thought is
given to evaluating the effect of regulations after they are
implemented.
Some RIAs included irrelevant detail, which obscured the key
information needed to inform decision-making. In general, RIAs are
still often seen as a paper-output rather than being integral to
the process of policy-making. Departments, however, are making
efforts to ensure that impact assessment is an integral part of the
policy-making process. According to today’s report, officials
should ensure that the RIA is necessary, start the assessment
early, integrate it into the decision-making process and make
greater and earlier use of departmental experts.
Departments need to challenge the way in which staff perceive
and use impact assessment in order to improve the chances of
influencing policy decisions and delivering better outcomes. The
Department of Trade and Industry has been the most proactive in
disseminating good practice and in providing a robust challenge
function to policy teams. Departments are taking positive steps,
such as using Board Level Champions to promote RIAs, but could do
more to use existing expertise, to give more information and
training to policy makers and to clarify responsibility for
delivering RIAs. The Better Regulation Executive also has an
important role to play in this process.
Sir John Bourn said today:
“Regulatory Impact Assessments are a vital tool for
Government to ensure that it is not introducing unnecessary or
excessive regulation. Although they have been in use for several
years, many are still failing to perform their intended function
properly. Departments must address the reasons why they have been
so slow at making improvements to the process of assessing the
impact of regulation.”
Notes for Editors
- Regulatory Impact Assessments have been used since 1998 and
around 200 ‘Final’ ones are produced each year. RIAs are required
for any form of regulation, including formal legislation, codes of
practice or information campaigns, which impact on business, the
public sector and voluntary organisations. They allow policy makers
to analyse the likely impacts – economic, social and environmental
– of a policy change and the options for implementing it. The
Government considers RIAs to be a key tool in delivering better
regulation and supporting its aim of regulating only when
necessary. The Better Regulation Executive provides guidance on
when and how to complete RIAs. Regulatory options should also meet
the principles of good regulation set out by the Better Regulation
Commission.
- We selected four departments on which to focus our examination:
Trade and Industry, Home Office, Transport and Culture, Media and
Sport. These offered a cross-section of departments in terms of
size and involvement in regulatory activity. The Department of
Trade and Industry was proposed by the Better Regulation Commission
as a department demonstrating many areas of good practice.
- Press notices and reports are available from the date of
publication on the NAO website, which is at
www.nao.org.uk. Hard copies can be obtained from
The Stationery Office on 0845 702 3474.
- The Comptroller and Auditor General, Sir John Bourn, is the
head of the National Audit Office which employs some 800 staff. He
and the NAO are totally independent of Government. He certifies the
accounts of all Government departments and a wide range of other
public sector bodies; and he has statutory authority to report to
Parliament on the economy, efficiency and effectiveness with which
departments and other bodies have used their resources.
Press Notice 47/06
All enquiries to Mark Strathdene, NAO Press Office: Tel: 020
7798 7183
Mobile: 07748 181 693