Transparency

Taoiseach's Foreword

Executive Summary

Glossary

Overview

Chart of Principles

Necessity

Effectiveness

Proportionality

Transparency

Accountability

Consistency

Action Programme for Better Regulation

Appendices

Appendix I - Regulatory Impact Analysis (RIA)

Appendix II - RIA and the Legislative Process

• We will consult more widely before regulating.

• There will be greater clarity about Public Service Obligations.

• Regulations will be straightforward, clear and accessible.

Enhancing regulatory transparency contributes to the quality of regulations, increases the likelihood of compliance and reduces the risk of "capture" or bias towards special interests. It also empowers citizens by giving access to information which enhances their decision-making abilities as consumers and as participants in the community. Freedom of Information legislation has already made an important contribution to transparency of regulation in Ireland.

Transparency is an important principle of good governance - it is widely accepted that there should be the maximum possibility clarity and openness in the operations of government and public administration. Transparency of regulations is also critically important to the performance of the economy, not least because it guards against special interests gaining undue influence in markets. It generates greater trust on the part of consumers. It assures and satisfies investors that there is a level playing field, and encourages new entrants to sectors. In terms of the quality of public services, the principle of transparency underpins the need for regulations to be as clear, straightforward and accessible as possible in their drafting, promulgation, codification and dissemination.

Many existing regulatory authorities, including the independent regulatory bodies, have quite sophisticated consultation processes. However, there is a need for greater consistency in our approach to consultation. Better consultation provides opportunities for stakeholders to have a meaningful input into the regulatory process. We need a regulatory framework that has mechanisms for informing and involving affected parties but is sufficiently open to ensure special interest groups do not gain disproportionate influence or control.

The State does not have a monopoly on wisdom or expertise in all areas of economic and social life. Problems can best be solved with the active involvement of the relevant stakeholders. The Government is committed to a social partnership approach across the policy spectrum. A similar broadly based inclusive approach will underpin regulatory policies and processes.

While excessive rigidity is undesirable, consultation norms should be established for sectors and groups of regulatory agencies - such as utility regulators, central Government Departments and local authorities. These would give customers a sense of what they can expect from regulatory bodies, such as the timeframes allowed for observations on regulations. These norms might vary from sector to sector or across different levels of government. There will, of course, always be the need for emergency regulation that would override normal consultation practices.

It is important to recognise the danger of over-representation of one particular viewpoint during consultations. Consideration will be given to encouraging not-for-profit groups to engage with the consultation process. Greater engagement will help consumer organisations, for instance, to become self-sustaining through demonstrated success in achieving policy influence.

In other jurisdictions, administrative procedures legislation has been introduced to give a statutory basis to service standards. In Ireland, the principles of accessibility and transparency in administration are supported by legislation such as the Freedom of Information Acts, the Ombudsman Act, the Data Protection Acts, the Ethics in Public Office Act and prompt payment legislation. Against the background of existing legislative provisions, the need for legislation to underpin administrative procedures will be kept under review.

However, guidelines for consultation will be prepared, setting out the range of consultation mechanisms and options available to regulators, be they central Government Departments or otherwise, and the circumstances in which they should be applied. Guidelines will include an assessment of the strengths and weaknesses of different approaches and set out the circumstances where particular approaches are best used. For example, "calls for comment", which are short advertisements in newspapers seeking comments on the basis of a few headings, have been found to be useful. "Notice and comment" procedures, on the other hand, give citizens a period for comments before the final rule is introduced. A sensible approach to consultation will be adopted in order to avoid blocking up the regulatory and decision-making processes. This may be achieved through a graduated approach to consultation, where some measures would be the subject of national advertisement and/or public meetings, while others would merit e-mail contact with identified/registered interested parties, and the use of Departmental websites.

In general, competition in a market brings lower prices, higher standards of service and greater choice. In the long run, most customers benefit from market liberalisation. If suppliers focus only on profitable areas, some potential customers - such as geographically isolated, low income or low demand consumers - may not benefit. For reasons of economic, social and regional cohesion, governments often decide that such customers should be provided with access to certain service levels at reasonable prices, even though it might not be commercially viable. Ensuring the provision of uneconomic - but socially desirable - service is commonly achieved through Public Service Obligations (PSOs).

It is important also that there is clarity around the scope, rationale and cost of PSOs and, as a subset, Universal Service Obligations (USOs). This is necessary so that citizens and consumers can be kept fully aware of their service entitlements. In addition, the Government needs to be clear about the cost of providing PSOs, given that it is usually either the taxpayer (via the Exchequer) or consumer that bears the costs of PSOs.

The costs related to the delivery of USOs to 'uneconomic' customers are usually balanced against the provider's overall profits and presence in the market. If the extra costs are deemed to be relatively insignificant, then the USO provider must absorb them into its cost base. However, if the USO can be shown as a significant and undue burden on the provider, then recompense may be available. This is usually funded through a levy on other service providers in the market. Thus, the cost of USOs generally falls ultimately on the other customers in the market.

In cases where the Government contracts out such services, it is important that alternative service providers are kept fully aware of the issues around PSOs, to ensure that barriers to sectoral entry are not created that would deter future competitors.

High quality regulation is essential for the appropriate functioning of society. How the regulation is explained to affected parties is critically important if it is to be effectively implemented, accepted and supported. The objectives and implications of the regulation and the responsibilities of those involved should be plainly set out and easily understood.

Regulation should be drafted in language that achieves its intended purpose, resolving the tensions between clarity, simplicity and accuracy. It should not create ambiguities and uncertainties. In addition, it is important to ensure Statutory Instruments (S.I.s) are drafted more consistently and, where possible, in plainer terms. Many significant proposals are legislated for through S.I.s and, in time, RIA should be applied to the more substantive proposals contained in S.I.s. In order to improve drafting of S.I.s across the Civil Service, the Office of the Parliamentary Counsel to the Government has produced a manual for Government Departments - "Statutory Instruments - Drafting Checklist and Guidelines" in 2003. To complement this, consideration will be given to options for enhanced scrutiny of S.I.s by the Oireachtas. Departments sponsoring legislation should consider publishing the draft heads of Bills where feasible and appropriate. This would enhance openness and transparency in the drafting process and allow for consultation on the measures proposed in the Bill. A completed RIA, where carried out, should also be published alongside the Bill to ensure openness and transparency in the legislative process.

The existing Explanatory and Financial Memoranda for primary legislation are confined to Bills as initiated. In future, an Explanatory Guide, which will explain the main purpose and principal provisions of the legislation, will be published alongside Acts or secondary legislation with significant impacts, particularly those with major implications for the consumer/citizen or SMEs, e.g. consumer protection, health and safety of workers, etc. These Explanatory Guides will be in a user-friendly, accessible form. By informing citizens of their rights and entitlements, such guides will help promote greater compliance and reduce the burden of enforcement on the Exchequer. This will also complement the drive for customer-centred delivery of public services.

The clarity of legislation will also be improved by avoiding the use of non-textual amendments. A non-textual amendment is one which does not insert text but instead requires the reader to interpret a word or phrase in a particular way. A non-textual amendment is made where an amending Act instructs the reader to read a particular provision or phrase in the Principal Act in a particular way. For example, in The Central Bank and Financial Services Authority of Ireland Act, 2003, the reader is asked to read "Bank" for "Board" in each place it occurs in a series of sections.

In relation to improved access for citizens to the existing stock of legislation, our programme for delivering e-Government will make provision for the accessibility of Acts, Statutory Instruments, the Chronological Tables (the Tables that provide information about amendments to Acts) and related materials such as Dáil and Seanad Debates. These initiatives will be structured to complement similar developments at EU level.

In addition, the programme of Statute Law Revision will outline specific targets and priorities for using repeal, consolidation and restatement to streamline existing legislation.