2: Assessment of the Impact of secondary
legislation
Summary: We welcome the revision of impact assessments
but suggest that they need to be better policed. In particular,
the potential burdens on business remain far more rigorously assessed
than potential burdens on the public sector. Other recent improvements
in regulatory practice (e.g. common commencement dates) also focus
on the needs of business when much secondary legislation is directed
at the public sector: education, health and the police in particular.
We invite the Government to give better consideration to the timing
or the cumulative impact of this regulation on those regulated,
irrespective of sector. We urge Departments to pay more attention
to the strategic planning of instruments, especially those delivering
the policy set by a new Act.
15. A welcome development since our original
inquiry is the extension of impact assessments to public sector
initiatives. The Better Regulation Executive has also revised
the impact assessment system (formerly Regulatory Impact Assessments)
to put greater emphasis on stating the policy objective more clearly,
identifying simplification benefits and plans for post-implementation
evaluation. The quality of IAs is however variable, especially
with respect to public sector matters. We offer two illustrations:
- the Social Security (National Insurance Credits)
Amendment Regulations 2007 (SI 2007/2582) (31st Report, 2006-07)
involved the management of discrepancies in contribution records
that arose when the data on DWP's Pension Service Computer System
were transferred to the National Insurance Recording System (NIRS
2). It took repeated effort for us to identify the actual sums
involved (see also Q 64).
- the Draft Payments into the Olympic Lottery Distribution
Fund etc Order 2007 (First Report, 2007-08) enabled the Secretary
of State to transfer £1085 million from the National Lottery
Distribution Fund (NLDF) to the Olympic Lottery Distribution Fund.
The Impact Assessment contained no information on alternative
funding options. Nor did it set out the anticipated benefits from
the Olympic programme and the uses to which the money would be
put. On inquiry, the latter two points were answered but the first
was not.
16. Although the Minister said that key proposals
were cleared by the high-level Panel for Regulatory Accountability
(QQ115-7), we wonder whether their consideration focuses on the
concept, rather than the practicalities of its delivery. Our concern
that the impact assessment process can appear cosmetic is shared
by others: the NAO has sampled RIAs from a range of Departments
and has found them to be of variable quality[11],
and too frequently used to shore up policy rather than formulate
it (QQ118-121). Worse is when facts revealed by the impact assessment
do not then sensibly influence the policy: in our report on the
Motor Fuels (Composition and Content) Regulations 2007 (SI 2007/1608)
(25th Report, 2006-07) data in the impact assessment were the
basis for our concern that the measure might imperfectly achieve
its policy objective.
17. The quality of IAs should be better policed
by the BRE. We are particularly concerned that potential burdens
on business remain far more rigorously assessed than potential
burdens on the public sector when so much secondary legislation
is directed at the latter: education, health and the police in
particular. This imbalance applies not only to impact assessments
but also to other recent improvements in regulatory practice,
such as common commencement dates: we see no reason why they should
be directed only at business when all could benefit.
18. Our concern was aggravated by the machinery
of Government changes in summer 2007 which have moved responsibility
for the BRE, with its oversight of the policy on Impact Analysis,
away from the central focus of the Cabinet Office and placed it
in the Department for Business Enterprise and Regulatory Reform,
the successor Department to the Department for Trade and Industry.
We already had doubts that public sector legislation was being
drafted with the same attention to the analysis of costs and benefits
as instruments that have an impact on business. The transfer to
the newly formed Department for Business, Enterprise and Regulatory
Reform, along with the downgrading of the responsibility for the
policy from Minister of State to Parliamentary Under-Secretary,
could make it less likely that public sector measures will receive
the necessary degree of attention (Q114).
Forward planning of secondary legislation
19. The Government rejected our recommendations
that the pattern of laying statutory instruments over the year
should be better planned and advertised. Our recommendation was
motivated not only by our concern at the impact of bulk laying
on parliamentary scrutiny (19% of the year's total number of instruments
were laid in March, in the run-up to the new financial year) but
also by the impact on users. While the Government have made efforts
to improve the system of impact assessment on individual instruments,
we have found it less capable of taking an overview of the impact
imposed on a sector by the suite of legislation required to implement
an Act. We have also seen divisions within Departments operating
without co-ordination, producing packages of SIs, the cumulative
impact of which is unreasonable in its burden on those affected.
20. Significant legislation is still being laid
immediately before, or in the middle of a recess, to come into
force during the recess: a practice of which we have long been
critical. For example, the Water Industry (Prescribed Conditions)
(Amendment) Regulations 2007 (SI 2007/2457) were laid on 23 August
and came into force on 1 October 2007; their purpose was to make
it possible for water undertakers to take forward compulsory metering
in areas of serious water stress.[12]
Effective Parliamentary scrutiny is weakened when secondary legislation
is brought into effect in such circumstances.
21. We were also concerned by the volume of SIs
laid by DCSF in August 2007, required to be put into effect by
the time the new term started at the beginning of September. We
felt that this would put unnecessary pressure on the schools'
administration to implement all this in time, and that DCSF's
legislative programme needed better coordination (QQ3,27-29).
The Minister responded that this would be improved by the move
to common commencement dates (CCDs: 6 April and 1 October), but
this again illustrated the predominance of business in DBERR's
outlook: CCDs do not apply to purely public sector matters (Q113).
22. A number of Departments have undertaken to
produce, and send to us for publication, plans for secondary legislation
which results from new primary legislation. DCSF told us about
a wall planner that they had issued to all local authorities for
the implementation of the Education and Inspections Act 2006 (Q25);
DCLG have promised a plan for the implementation of the Local
Government and Public Involvement in Health Act 2007; and the
Ministry of Defence have been particularly helpful in providing
a table relating to the implementation of the Armed Forces Act
2006, while stressing that this is a snapshot showing the February
2008 position on SIs which may be expected to change, perhaps
significantly, with the passage of time (printed at Appendix 4).
We welcome these undertakings and hope that all Departments
will routinely produce and publish plans for secondary legislation
to be made in consequence of a new Act. The plans will aid
our understanding of how individual instruments fit into the overall
programme and policy, and they will be of equal benefit to stakeholders.
We accept that it is difficult accurately to predict the timing
of the delivery policy to this extent and that plans must be subject
to revision without automatic criticism.
23. The Government rejected our request for Departments
to publish their more general plans for secondary legislation
but we welcome the two-month overview which DWP provided after
their evidence session, setting out the instruments which they
expect to lay in the annual peak period in February and March
(Q42 and Appendix 5). Despite the Minister's reticence (Q111),
we consider these overviews helpful to our scrutiny and consider
their production a useful discipline that might produce less and
better focused legislation.
24. We welcome the plans for secondary legislation
which we have seen and recommend that Departments produce such
a plan for the secondary legislation which is to result from any
new Act of Parliament. We also recommend that Departments produce
ad hoc overviews of their intended legislative output at peak
periods: to do so helps parliamentary scrutiny.
25. The House of Commons Modernisation Committee
has asked for the summer announcement of the draft legislative
programme for the next session also to include key items to be
delivered by secondary legislation[13].
We agree. This would be of benefit to Parliament and user alike.
It would help us to plan our scrutiny resources and might prompt
Departments to plan more of their secondary legislative programme.
We note, though, that the Government rejected our earlier recommendations
to this end[14].
Simplification, consolidation and correction
26. 1,168 statutory instruments were laid in
2007, 1,112 in 2006: the volume of secondary legislation remains
high. We had hoped that the Better Regulation Task Force's report
Less is more[15]
might have had greater impact. This report was warmly welcomed
by the Government, which adopted its "one in one out"
regulatory objective. Each Department has published a simplification
plan, aimed at reducing regulatory legislation to more manageable
proportions but, in our experience, thin on the actual will to
revoke existing regulations (Q85). Departments still seem automatically
to reach for secondary legislation as the means to deliver policy.
27. The number of instruments which amend existing
instruments has also remained constant: 510 last session. While
the amendments themselves are almost always for a good reason,
cumulative amendment adds an undesirable layer of complexity for
users. We are pleased that, since our original report, the statute
law database of up-to-date and in-force primary legislation has
been published online, free to all[16].
But we regret that the Government have not extended this facility
to secondary legislation. The Minister rightly said that information
on the current position is often more accessible in the form of
guidance (Q94), but the law itself ought to be accessible and
clear. It is inconsistent with the principles of better regulation,
particularly transparency and accountability, that the public
do not have free access to the current text of the law (QQ92-100).
28. EMs now regularly refer to consolidation,
if often to say that it will be attended to when resources permit.
Some Departments are happily more engaged: last session DWP consolidated
the Incapacity Benefit and Housing Benefit Regulations (Q56),
which we commend. The Food Standards Agency is taking an active
approach, consolidating once two or three amendments have been
made. The Ministry of Justice's programme of revising electoral
legislation in consequence of the Electoral Administration Act
2006 includes a programme of updating and consolidating the legislation
for all the relevant sectors. We also accept reasoned opposition
to consolidation: the Department of Health's review of the NHS
Pension Scheme[17] and
the Ministry of Justice's review of judicial rules have explained
why consolidating these areas is not yet appropriate. Both are
in the middle of a major programme of reviewing and replacing
legislation and have stated that they will consolidate the whole
when they get to the end of it. Such statements at least demonstrate
that officials have considered the issue, thought about users'
needs and have a real plan to improve the situation.
29. The law should be clear and accessible to
make its obligations plain and so achieve its policy objectives.
We urge departments to devote more resources to the consolidation
and, particularly, simplification of existing secondary legislation.
While we prefer full consolidation, with the opportunity for simplification
which it affords, we also welcome the internet publication of
informal consolidations by a number of Departments, as notably
provided by the online editions of DWP's social security "blue
books" and the Home Office's statement of immigration rules.
Both of these perform the simple but very important function of
ensuring that there is an up-to-date statement of the law available
to the public. More resources should be devoted to consolidation
and simplification, at the very least to the publication of on-line
consolidations.
Transposition of directives of the European Union
30. Our support for consolidation is built on
a concern that good law should be clear and easily accessible.
The same motive underlies our concerns about the transposition
of European Union directives. Our end-of-session report for 2005-06
expressed concern about the excessive use of cross-referencing
in the transposition of EU directives[18],
making it necessary for a user to look up as many as 20 directives
before he could find out what action of his would result in a
penalty. We are pleased to see that the BRE's revised guidance
on transposition, published following Lord Davidson of Glen Clova's
review of the implementation of European Union legislation, picks
up this point[19] and
we await improvements in practice.
Guidance
31. In our last report, we invited the Government
to ensure that EMs stated what guidance Departments were making
available to stakeholders where an SI imposed complex obligations.
We are pleased that this recommendation has been adopted. The
guidance can be either to the officials who will be required to
operate the legislation or to those who will be required to comply
with it. DCSF outlined their current practice for tailoring guidance
according to the audience (QQ32-3); DWP is reviewing its current
range of leaflets but acknowledged that, at root, it was the complexity
of the legislation itself that needed addressing (Q80).
11 See, for example, Evaluation of Regulatory Impact
Assessments 2006-07 published 11 July 2007 (HC paper 606),
Evaluation of Regulatory Impact Assessments 2005-06 published
June 2006 (HC paper 1305), Evaluation of Regulatory Impact
Assessments 2004-05 published March 2005 (HC paper 341) and
Evaluation of Regulatory Impact Assessments 2003-04 published
March 2004 (HC paper 358) Back
12
30th Report (2006-07). Back
13
First Report, 2007-08, HC 81, paragraphs 8-11. Back
14
Letter from Baroness Ashton of Upholland, Parliamentary Under-Secretary
of State, Ministry of Justice: 22nd Report (2006-07), Appendix,
Annex 2. Back
15
Regulation - Less is More: Reducing Burdens, Improving Outcomes,
report by the Better Regulation Task Force, March 2005, http://archive.cabinetoffice.gov.uk/brc/upload/assets/www.brc.gov.uk/lessismore.pdf
Back
16
www.statutelaw.gov.uk Back
17
See, for example, National Health Service (Pension Scheme and
Compensation for Premature Retirement) Amendment Regulations SI
2006/2919 EM para 7.9: "Consolidation of regulations
is kept under review and will take place as soon as resources
permit. The on-going review of the NHS Pension Scheme is expected
to lead to a completely new scheme and regulations within two
years. In the same timeframe there will also be a significant
set of corresponding amendments to the current pension scheme
regulations. We will only realistically be in a position to consider
consolidation at that stage." Back
18
49th Report (2005-06) paragraph 15. Back
19
Transposition Guide: How to implement European Directives effectively,
Department for Business, Enterprise and Regulatory Reform, published
September 2007, paragraphs 3.17 and 3.31-2. Back
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