SMART REGULATION A cleaner, fairer and more competitive EU Summary by Elpida Heracleous 29 March 2010

2 Smart Regulation: What, Why and How 0 The report challenges the way European institutions make decisions and argues that smart EU regulation requires that businesses and citizens be at the heart of all European policy-making. 0 It shows how smart EU regulation should support growth and recovery in the current economic climate, maximise the European Union's social and environmental benefits, while reducing burdens and costs.

3 Key central elements to smart regulation The four key elements that are central to smart regulation: 1. The EU should develop and implement regulatory and non regulatory interventions in a smarter way, learning from the very best practice in MS and other countries around the world.

4 Key central elements to smart regulation 2. An approach is needed that embeds the elements of smart regulation in every intervention in every policy area, rather than operating in isolation. 3. Smart Regulation should further help EU institutions effectively work together in the development and design of policy. It can provide a framework for the Commission, Council, Parliament and MS to make transparent, evidence based decisions that encourage and deliver democratic oversight in sensitive areas.

5 Key central elements to smart regulation 4. In order to create smart regulation, should keep end-users – employees, consumers, businesses and other organisations in mind during policy making. It is the policy makers’ responsibility to involve the end-users, just as it is the end users’ and MS’ responsibility to contribute to the process.

6 Why end user focus is important As per Commission President Baroso: “Revitalising the link between the peoples of Europe and the EU will make it both more legitimate and more effective. Empowering citizens to be involved in decisions affecting their lives, including by ensuring transparency on how they are taken, will help to achieve these aims.” 1 1. José Manuel Baroso, Political Guidelines for the Next Commission, 2009, p.33

7 Elements for creating and implementing smart regulation for end-users Opportunities for end-users to get involved really exist. Robust governance mechanisms and incentives ensure end-users’ contributions are taken into account effectively. Quantitative and qualitative progress is tracked and communicated to end-users in a systematic way.

8 How can end-users see what is going on and get involved? o Recently, EU and MS developed better ways of informing end-users and inviting their views but there is more room for improvement. There is evidence that government openness is positively linked to lower regulatory burden and effective regulatory governance o common commencement dates for business related proposals, o strengthen the legislative and work programme by defining and publishing what contributes a ‘significant’ measure for inclusion and the likely scale of individual measures’ benefits, costs and AB).

How can end-users see what is going on and get involved? o Commission should make two-way communication more effective and extend the minimum 8 week consultation period and applying the new minimum consistently o consultation guidelines in 2002 o Webpage Your Voice in Europe o European Business Test Panel est A tool used by Commission in testing early ideas and seek initial data from a large sample of businesses

How can end-users see what is going on and get involved? o Impact Assessments should be communicated and updated by EU Institutions through out the policy making cycle. o A two page statement to be included in all EU IAs with key estimated costs and benefits. The Council and Parliament to use it extensively. o IAs to be carried out on all significant measures and to be updated throughout the policy making cycle.

How can end-users see what is going on and get involved? Examples across the EU: Kafka (Belgium) introduced an online contact point where citizens comment on existing regulations and submit proposals for improvement. These proposals formed the basis of a reform programme for the Federal Gov.

How can end-users see what is going on and get involved? Examples across the EU: Burden Hunters Project (Denmark) applies user-centric innovation techniques to allow users to identify the red tape that causes them more irritation. Civil servants visiting businesses to see challenges they face. Businesses set the agenda for regulatory action and help develop solutions to cut AB.

How can end-users see what is going on and get involved? Examples across the EU: Simplifying Together (France): Developed a framework that focuses on “life-events” to understand better the burdens faced by businesses. Includes key point in life of a business (starting up, moving, hiring etc) Using this framework and through consultation with the users of regulation they developed a programme to reduce the number of processes, the cost and the time to navigate these events.

How can end-users see what is going on and get involved? Examples across the EU: Consulting on IAs (UK): Views IAs as a continuous process, from the early stages of identifying a policy challenge through to development of policy options, public consultation and final decision making and implementation. A Small Firms Impact Test is included if proposal affects business. End-user comments not only on proposal but also on analysis and evidence underlying it.

15 How can end-users be confident that their contributions are used and produce tangible results? o Ensuring the best policy outcome by improving the use of regulatory alternatives throughout the policy making cycle. oCommission to continue work with small businesses across policy areas to develop and promote effective measures on the basis of costs and benefits-Think small First) oGermany relaxed rules regarding recording of driving times for vehicles btwn tons oFinland website for small firms for fulfilling their obligations as employers oIreland reduced freequency with which small firms need to file and pay taxes. oEU Inst to reviews Inter-Institutional agreement (how to better assess and manage alternatives to regulation through out the policy-making cycle).

How can end-users be confident that their contributions are used and produce tangible results? Improving regulatory outcomes by strengthening the commission IA Board and embedding smart regulation principles in the work of council and parliament. IA board should make further use of external experts to ensure rigorous quantification of the costs and benefits of proposals Commission Council and Parliament to ensure IA Board’s opinion is taken into account and encourage tougher consequences if not.

17 How can end-users be confident that their contributions are used and produce tangible results? o Introducing robust monitoring that ensures that the reduction of regulatory burden is tangible for businesses. o The remit of the Stoiber group to be strengthen to examine the role of all 3 EU institutions in imposing new unnecessary burdens and incorporate costs and irritants, while taking real benefits into account. o Programmes aimed at reducing regulatory burdens on business should deliver tangible results on an ongoing basis.

How can end-users be confident that their contributions are used and produce tangible results? o Introducing robust monitoring that ensures that the reduction of regulatory burden is tangible for businesses. o AB programme to be widened to include proposals within and beyond the current 13 priority areas o To ensure tangible results the 25% target should consider AB that arise from new EU legislation. o The EU to ensure that new legislation does not create barriers for eGovernment solutions when implemented.

How can end-users be confident that their contributions are used and produce tangible results? Improving the quality of regulation by checking its relevance throughout the policy making-cycle EU Institutions to develop mechanisms to check periodically that proposals are still relevant

20 How can end-users see that genuine quantitative and qualitative progress has been made? For smart regulation to be a success there needs to be transparent mechanism across the whole programme.

How can end-users see that genuine quantitative and qualitative progress has been made? Commission and MS should improve accountability by better monitoring and communicating the quantitative outcomes of smart regulation, and how end users are experiencing improvements. Annual progress report by Commission on legislation that came into force the last year Annual progress report by Commission on legislation that came into force the last year To help create better ownership and accountability of the agenda across all the institutions, Commissioners should have clear responsibilities for delivering smart regulation in their specific policy areas.

22 How can end-users see that genuine quantitative and qualitative progress has been made? The Council and Parliament should strengthen their oversight of smart regulation to increase democratic scrutiny Every Council formation and parliamentary committee should consider how to deliver smart regulation as part of their policy making process. Parliament to further promote Smart Regulation and explore whether to establish a Parliamentary Better Regulation Committee to focus on reviewing all of the BR programmes

How can end-users see that genuine quantitative and qualitative progress has been made? The European Court of Auditors should evaluate the Smart Regulation programmes to enable further reform and improvement The ECA should assess on a systematic basis whether BR programmes are delivering on their promises as it does with the IA system