REDUCING ADMINISTRATIVE COSTS Regulatory Reformgroup Istanbul 20/11/07

Institutional Capacitıes

Dutch Approach

Ambition the Netherlands Quantitative target: 25% net How? Systematic measurement Budgetting AB per ministry Involvement of business sector Interministerial coordination and monitoring by Min Fin

Rules of the Game Every Minister has maximum of AB Sum is 75% of 2003 stock Ministers not allowed to exceed the maximum ( budget ) Hence: obligatory compensation & ex-ante calculations Reduction packages

Involvement Stakeholders Independent Advisory Board (ACTAL) Interministerial unit (IPAL) Website for complaints and suggestions Involvement business sector

Dutch AB Approach in a Nutshell SCM makes hidden costs transparant Budgetting creates scarcity Interministerial approach using satellites Involve stakeholders External advisory board

Decision making proces and polıcy actıon

Business Impact Assessment Proposed legislation Desk The Proposed Legislation Desk is operated jointly by the Ministry of Economic Affairs, the Ministry of the Environment (Environmental Assessment) and the Ministry of Justice (Practicability and Enforceability assessment). It oversees and checks the quality of the RIAs. There is a weekly meeting with the representatives of these three Ministries.

Business Impact Assessment Staffing -Within the PLD 6 people work on the BIAs -2006: 205 BIAs were performed. -50% of the BIA showed substantial effects for the business community

Business Impact Assessment Type of regulation we assess In a first instance, the BIA is for proposals for new laws, orders in council and amendments to them If thought necessary a BIA may also be performed on other forms of regulation.

Business Impact Assessment When should an assessment be performed? The BIA must be performed as early as possible, preferably as soon as a basic draft of new legislation has been designed. The outcomes of the assessment are most valuable precisely in the phases in which it is still possible to alter modalities: so you can choose the least burdensome alternative

Business Impact Assessment Proces The initiating ministry is responsible for the quality of the proposed legislation as a whole. It is also responsible for ensuring that the effects and side-effects of the legislation are transparent by means of the performance of the BIA (and/or EA and P&E). The ministry responsible must then submit the IA to the Ministry of Justice for the legislative test of the proposed legislation, accompanied by the explanatory memorandum that includes the outcomes of the assessment(s).

Business Impact Assessment The results of an IA should be included into a separate paragraph in the explanatory memorandum accompanying proposed legislation. This enhances the so needed transparancy.

Business Impact Assessment The Ministry of Justice will forward the BIA and/or EA for review to the Ministry of Economic Affairs or the Ministry the Environment. The Ministry of Justice will review the P&E itself.

Business Impact Assessment The final part of the examination of the proposed legislation - both for the legislative test and for the performed assessments - is a legislative report produced by the Ministry of Justice that states approval or disapproval. This report is sent –together with the proposed legislation – to the Council of Ministers.

Political support

Political commitment SCM methodInfrastructure Incentives Clear targets? Ownership? Stakeholder involvement? How did we get there? Available? Resources? Knowledge? Quality control? Strong coordination? Dept. involvement? Countervailing power?

Dutch AB approach in a nutshell oSCM = hidden costs transparent oBudgetting AB creates scarcity oCompensation required oInterministerial framework oMinisterial satellites oIndependent advisory board oInvolvement stakeholders

Necessary condition: Quantitative SCM method Results: oSense of urgency oDiscipline to reach substantial AB reductions oVisibility macro problem () oVisibility pay-off (GDP) oTransparency micro level (X-rays laws) P x Q 1…12

Brian Huijts Regulatory Reformgroup The Netherlands B.B.W.

Top 10 Dutch AB Legislation LegislationAB (in millions ) in the Netherlands 1. VAT1, Financial accounting1, Product & safety requirements (labelling) 1, Tax on wages/salaries National health service act Employees' insurances Act on conservation of nature Income tax Pricing of products Working conditions500 Total8,400

Europe

Dissemination Full scale application of SCM Developing common EU-methodology OECD Red Tape Scoreboard (road freight sector) SCM-Benchmarking VAT Permits Transport In preparation + Member States + 15 countries

Brussels Commission committed to regulatory reform: Withdrawal pending proposals Simplification Impact assessment Administrative cost measurement