1. Scrutiny of RIAs Problem Definition and Objectives
Workshop: RIA for Prime Ministry Experts 13 October 2009 EuropeAid/125317/D/SER/TR
Session 3
Scrutiny of RIAs Problem Definition and Objectives 1

2. Overview of Scrutiny of RIAs
An RIA should:
Provide a logical framework for development of proposals
Describe the rationale for government intervention
Explain what is intended to be achieved and how
Set out the evidence base for decisions
Be a communication tool

3. Purpose of an RIA It provides a framework for the regulator to:
Identify the problem to be addressed
Consider the objectives to be achieved
Set out possible options to resolve the problem
Carry out analysis of risks, costs and benefits
Undertake effective consultation
Plan implementation and enforcement
Enable informed decision-making

4. Key Questions That Should Be Addressed
What is the problem?
Why is government intervention needed?
What are the objectives we want to achieve?
What are the options to get there?
Are there alternatives to regulation?
How will we implement and enforcement to ensure compliance?
Do the benefits justify the costs? 4

5. Problem Definition
The first key issue for scrutiny is whether the RIA:
Identifies and clearly defines the problem
Provides information about the background to the issue:
Why has the problem arisen?
What harm is being caused and what is the evidence
Quantify the problem e.g. pollution emissions will result in 10 million cases of illness by 2015
Describes what will happen if the problem is not addressed in 2, 5 or 10 years
Explains why is there a need for government intervention

6. Good Problem Definition
The problem definition must define the causes underlying the issue rather than the symptoms.
Example:
Good problem definition (causes and symptoms): a reliable survey shows that lack of awareness and clear information about an existing law is leading to low compliance. The preferred solution may be an extensive awareness and education campaign. 
Bad problem definition (only symptoms): it is known that there is low compliance with a law. The perceived solution may be a new penalty regime with large enforcement costs, without addressing underlying causes.

7. Objectives
Objectives provide effective criteria for assessing success or failure of proposals.
Objectives are not about taking a particular action - this will bias consideration of most appropriate option to resolve a problem e.g. objective should not be to adopt a regulation as this is just one option for solving a problem.
The RIA should clearly:
Describe what is intended to be achieved in both the short and long term
Explain how this will be monitored – what are the key success factors?

8. Objectives should be SMART
Specific: objectives should be precise and clear enough to be interpreted and understood similarly by all those affected
Measurable: objectives should define what is to be achieved in measurable terms – both quantitative and qualitative – so it is possible to verify whether they have been achieved
Achievable: objectives must be achievable both for those responsible for implementing them and complying with them
Realistic: to make them meaningful, a balance must be sought between setting objectives that are ambitious but also realistic
Time-dependent: without a fixed date or specified time period, objectives are vague and it is impossible to evaluate whether the intervention has been successful

9. Options
Once the problem definition is clear and the objectives identified and agreed, options for resolving the problem can be identified.
At this stage, the next important issue for scrutiny is how effectively and widely the RIA has been consulted on, from the early stages through to formal public consultation on the final RIA.