12 Impact assessments and EU decision-making
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15795/10
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| Special Report No 3/2010 by the European Court of Auditors: Impact assessments in the EU institutions — do they support decision-making?
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| Legal base | —
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| Deposited in Parliament | 5 November 2010
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| Department | Business, Innovation and Skills
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| Basis of consideration | EM of 23 November 2010
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| Previous Committee Report | None, but see footnote
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| To be discussed in Council | See paragraph 12.12 below
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| Committee's assessment | Politically important
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| Committee's decision | Cleared
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Background
12.1 As we noted recently, the production of impact assessments
by the Commission when putting forward legislative proposals is
one of the cornerstones of the Better Regulation[59]
policy, and, in this Special Report, the European Court of Auditors
has analysed how far such assessments have supported decision-making
by the EU institutions.
The current document
12.2 The Court says that the report covers the period 2003-08,
and involved an international comparison of impact assessment
systems, an analysis of a sample of Commission impact assessments,
and interviews with those preparing and using them, with the findings
being examined against the relevant inter-institutional agreements,
the Commission's own guidelines, and general good practice. In
particular, it examines the extent to which:
- impact assessments were prepared by the Commission when formulating
its proposals, and subsequently consulted by the Council and European
Parliament during the legislative process;
- the Commission's procedures for impact assessment
appropriately supported its development of initiatives;
- the content of impact assessment reports was
appropriate, and their presentation conducive to their being taken
into account in decision-making.
12.3 The Court observes that impact assessments are
intended to identify and assess the problems being addressed and
the objectives pursued; to develop the main options for achieving
those objectives, and analyse their likely economic, environmental
and social impacts, together with potential administrative burdens;
to assess possible implementation and enforcement problems; and
to specify monitoring and evaluation arrangements. It notes that
all major policy initiatives — defined, with some clearly
identified exceptions,[60]
as those presented in the Annual Policy Strategy or in the Commission's
Legislative Work Programme — are now subject to an impact
assessment, as are other significant initiatives on a case by
case basis: and the system also applies to revisions to existing
EU legislation and (since 2009) to implementing rules adopted
under comitology procedures. It also points out that inter-institutional
agreements between the European Parliament, Council and Commission
have agreed that impact assessments make a positive contribution
to improving the quality of EU legislation, and that both the
Parliament and Council have committed themselves to using them
during the negotiating process.
Use of impact assessment for decision-making
12.4 The Court notes that, during the period audited,
impact assessments were increasingly used in the development of
Commission policy initiatives and legislative proposals, the numbers
rising from 21 in 2003 to 121 in 2008, with the main condition
for selection being inclusion in the Commission's Legislative
Work Programme (though it adds that assessments have increasingly
been carried out on other initiatives as well). It says that they
are becoming part of the Commission's policy developing culture,
and it notes that since 2007 their quality has been reviewed by
an Impact Assessment Board —
though it observes that they are used in order to support the
policy development process, rather than to decide whether to pursue
a proposal.
12.5 The Court says that all impact assessments accompanying
legislative proposals are forwarded to both the Council and European
Parliament, but it suggests that in practice they are not systematically
presented at committee or working group meetings, and that explicit
references to them in reports are rare. Nevertheless, it records
that users at both institutions see them as providing relevant
information, and as contributing to the quality of the measure
adopted: likewise, they are also taken into account by other interest
groups, although some regard them as policy justifications for
the Commission's proposals rather than independent assessments
of their possible impacts.
12.6 The Court goes on to note that almost all Commission
proposals are modified — sometimes quite extensively —
during consideration by the Council and European Parliament, but
that very few of the amendments made then have been subjected
to an impact assessment by either body, and nor has the Commission
itself produced updated assessments. It also comments that the
UK is the only Member State to carry out its own impact assessments
in order to build its negotiating position in the Council.
Commission procedures for preparing impact assessments
12.7 The Court notes that, although the Commission
states that assessments should be targeted at initiatives having
the most significant impacts or which are politically sensitive,
decisions are taken on a case-by-case basis, and that there are
no quantified indicators to establish thresholds above which an
assessment should be carried out: nor are the reasons for selecting
a particular initiative outside the Commission's Legislative Work
Programme made public. The Court also comments that, although
the Commission consults widely in drawing up its impact assessments,
it does not invite comments on draft reports. On the other hand,
it draws attention to the recent improvements in the way in which
the Commission reviews the quality of its assessments, including
the contribution of the Impact Assessment Board (which in 2008
requested the resubmission of 43 out of the 135 cases it examined).
It also notes that, although the Board does not have a mandate
to require Directorates General to initiate an assessment for
a particular proposal, a number of additional assessments have
been carried out as a result of its advice.
Content and presentation of impact assessments
12.8 The Court says that its analysis showed that
impact assessments provided an adequate overview of the problem
being addressed and a set of reasonable policy objectives, and
that Member States and other stakeholders felt that this helped
them to understand the Commission's reasons for initiating a proposal.
However, it adds that assessments did not always make it clear
how the intended mechanism would deliver the policy objective,
and it comments that the aim of analysing all significant economic,
social and environmental impacts is ambitious compared with the
approach followed internationally. The Court also comments on
the different weight given to these three areas, and the difficulty
in comparing alternative options as a result of the different
weight sometimes given to the depth of analysis of different options,
and insufficient or inadequate quantitative data —
a problem it says is compounded by differences in the availability
and reliability of data provided by Member States. The Court highlights
the needs for assessments to take greater account of implementation
and enforcement costs, whilst recognising the difficulty arising
from the existence of 27 different national legal systems and
the absence of national impact assessments: and it also stresses
the need for the systematic ex-post evaluation of existing policies
and programmes, not least in relation to the need for the Commission
to propose revisions.
12.9 The Court concludes by making a number of recommendations:
- as regards the impact assessment
process, it says that the Commission should provide an overview
of all legislative initiatives for which it intends to undertake
an assessment (with a reasoned justification when one is not performed),
that it should publish interim documents (such a draft assessments),
and ensure that quality reviews by the Impact Assessment Board
take place on a timely basis;
- as regards the content and presentation of reports,
it says that the Commission should facilitate a comparison of
options by improving their quantification of costs and benefits,
seek to improve the quality of the available data, put more emphasis
on implementation and ex-post evaluations, and analyse enforcement
costs in more detail.
The Government's view
12.10 In his Explanatory Memorandum of 23 November
2010, the Minister of State for Business and Enterprise at the
Department for Business, Innovation and Skills (Mr Mark Prisk)
says the Government warmly welcomes this report, which it believes
provides a useful analysis of the Commission's progress in introducing
impact assessments, and the improvements which have been made
since they were first introduced. It also strongly agrees with
a number of points raised by the Court and its recommendations,
especially the need for all the EU institutions to have a joint
responsibility for the delivery of evidence-based legislation,
and the suggestion that the Commission should publish draft impact
assessments for comment before it finalises policy decisions.
He describes the latter as one of the UK's key priorities in its
response to the Commission's consultation on smart regulation,
but says that it was not reflected in new strategy for that area.
12.11 The Minister says that the Government was nevertheless
pleased to see that the recent Commission Communication on smart
regulation contained a commitment to improving its impact assessment
system, including the intention to carry out ex-post reviews of
existing legislation; to improve the quality and availability
of data used; and to give the Impact Assessment Board more power
to challenge proposals made by Commission departments. However,
the Government believes that there is still considerable need
for improvement, and that some of the recommendations in the report
do not go far enough, with some key elements appearing to have
escaped discussion altogether. In particular, the Minister notes
that the UK's response to the Commission's smart regulation consultation
urged it to improve the scrutiny and quality of regulation to
small businesses, and he is disappointed that there is no analysis
in this report about how the SME Test is used within the Commission.
He also believes that, although the Impact Assessment Board has
been an important innovation, its operation could be strengthened
further, for example by engaging the advice of external experts,
ensuring the consistent application of the SME Test, and pushing
for alternatives to regulation to be considered wherever feasible.
12.12 The Minister says that the report has been
considered in Brussels by officials, and is likely to be noted,
without substantive discussion, at the Competitiveness Council
on 10 December 2010.
Conclusion
12.13 We have recently noted (and welcomed) the
increasing use of impact assessments as part of the EU decision-making
process, and this report by the European Court of Auditors is
thus topical and timely. We are therefore drawing it to the attention
of the House, but, as it does not appear to raise any issues requiring
further consideration, we are clearing it.
59 (32067) 14421/10: see HC 428-ix (2010-11), chapter
11 (24 November 2010). Back
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