1. Workshop on GRP, Quito, Ecuador, 7-9 Nov. 2018
TECHNICAL COOPERATION
Workshop on GRP, Quito, Ecuador, 7-9 Nov. 2018
Regulatory options
Alex Inklaar, PTB consultant

2. Agenda
Decision making – regulatory options
Introducing RIA

3. Decision Making in Regulatory Policy
Policy Instruments
Decision making in regulatory policy should start from the following questions:
What exactly is the issue or problem we want to address?
Do we really need a regulation?
Would a regulation be the most adequate and (cost) effective measure to address the issue?

4. Alternatives to regulation(s)
No action
Recommendations and info campaigns coupled with incentives (e.g. tax incentives)
Self-regulation e.g. by an industry
Initiation of and participation in standardization projects
Education and information campaigns
“Co-regulation”, which integrates regulation with other instruments (e.g. standards) developed on the basis of multi- stakeholder cooperation

5. Alternatives to regulation(s)
Can you think of typical obstacles to the (more frequent) use of alternatives to regulation? Or, in other words, what keeps regulators from using alternatives to regulation?

6. Non-legislative public policy measures - an example
The Canadian government offers grants for industrial organizations that adopt systems and processes to improve energy performance. One of the criteria for eligibility to receive a grant is that companies must implement the CAN/CSA ISO Energy Management Systems Standard.

7. ISO 50001:2018
is based on the management system model of continual improvement also used for other well-known standards such as ISO 9001 or ISO
ISO 50001:2018 provides a framework of requirements for organizations to:
- Develop a policy for more efficient use of energy
- Fix targets and objectives to meet the policy
- Use data to make informed decisions about energy use
- Measure the results
- Review how well the policy works, and
- Continually improve energy management.

8. Non-legislative public policy measures
Can you give examples of non-legislative public policy measures from your own country?

9. Regulatory Impact Assessment (RIA)
RIA systematically identifies and assesses expected effects of regulatory proposals
based on determining the underlying regulatory objectives and identifying policy interventions that are capable of achieving them.
All “feasible alternatives” must be assessed. Decision-makers must be informed about the effectiveness and efficiency of different options

10. Conducting a „Sreening“ RIA (Example: Ireland)
Description of policy context, objectives and options
(i) Policy context
(ii) Statement of objectives
(iii) Identification of options/choices
Identification of costs, benefits and impacts
(i) Risks and assumptions
(ii) Costs
(iii) Benefits
(iv) Other impacts
(v) Summary of costs, benefits and impacts
Consultation
Enforcement and compliance
Review

11. Conducting a „Full“ RIA (Example: Ireland)
Statement of policy problem and objectives 67 Identification and description of options 70 Impact Analysis including costs and benefits of each option 72 (i) Types of costs and benefits (ii) Analytical techniques (iii) General rules and principles in analysing costs and benefits (iv) Discounting (v) Alternatives to monetisation (vi) Distributional analysis (vii)Risk and uncertainty Consultation Enforcement and compliance Review Summary of performance of options/recommended option

12. Distributional analysis
RIAs should examine the effects of regulatory options on consumers,vulnerable groups, the socially excluded, and business. It is extremely difficult however to quantitatively take account of distributional effects.
Most Full RIAs will therefore rely on a qualitative description of the distribution of costs and benefits
which the decision-maker can take into account alongside the net present value of the costs and benefits.
(Source Irish Guide on RIA)

13. The value of RIA
It is important to note that RIA is not a substitute for decision making. Instead, RIA is best used as a guide to improve the quality of political and administrative decision-making, while also serving the important values of openness, public involvement and accountability.

14. The Benefits of RIA
Brief exercise: 1) Each table round discusses and agrees on the three most important benefits of RIA and writes these on cards (1 benefit per card) 2) The cards are pinned to a soft board 3) Each participant allcocates red dots to the most important benefit(s) (3 red dots per person)

15. The benefits of RIA can be summarised under three headings:
Performance of the economy and consumer welfare
Quality of governance
Efficiency and effectiveness of the public service
(Various sources)

16. Benefits of RIA According to the OECD:
“…RIA’s most important contribution to the quality of decisions is not the precision of the calculations used, but the action of analyzing – questioning, understanding real-world impacts and exploring assumptions”.

17. RIA document
Results published with regulatory proposals and new legislation
Describes the issue that has given rise to a need for regulation
Compares various possible options for dealing with that issue
Identifies the costs and benefits of each option, and quantifies wherever possible
In order to assist informed public debate about regulation

18. Motivation for introducing RIA
Efficiency/ burden reduction
Transparency
Accountability
Controlling bureaucracies
Effectiveness and policy coherence

19. Risk assessment
Technical regulations and effective measures for their enforcement (conformity assessment procedures and market surveillance) should ideally be based on the results of risk assessment.
Feasibility of own pre-legislative risk assessment?
Access to other countries’ and regions’ risk assessment results?
Adoption of International Standards
Adoption of easy-to-apply risk assessment methods for market surveillance purposes (several European models available)

20. Thank you very much for your kind attention