Local authorities and others take note – the UK Government's better regulation crusade is heading your way. BERR's latest piece of regulatory reform, the 'Regulators' Compliance Code', which will shape the future development of regulators' policies, has been approved by both Houses of Parliament and will come into force on 6 April 2008.
This statutory code of practice is made under the 2006 Legislative and Regulatory Reform Act and affects a large number of regulators. There is some overlap with the recent House of Lords' work on economic regulators (highlighted in previous issues of this bulletin) but its reach is much wider than the big economic regulators such as Ofgem, Ofcom and the ORR. All 'regulators' and regulatory functions listed in The Legislative and Regulatory Reform (Regulatory Functions) Order 2007 (SI 2007/3544) are covered and that list includes a wide range of local authority functions: from those under health and safety legislation to matters relating to education, anti social behaviour, charities and consumer protection.
The code of practice does not extend to devolved matters, but it is expected that the Scottish Government will pick up similar points in the context of Scottish regulatory reform work.
The code lists seven broad factors which regulators must 'have regard to' when developing their general policies or position. These factors need not be specifically assessed in each case where they exercise their functions. Some of those factors include: considering the impact that their interventions will have on the economic progress of small regulated entities; proactively providing advice and guidance as to the application of the regulations in question; identifying and assessing the risk areas for non-compliance; and ensuring that their resources are specifically targeted.
The code does not require regulators to re-cast existing policies but it must be borne in mind as they update them (although where regulators lack explicit policies on matters such as their approach to risk assessment they will now be required to adopt them). More immediately, the code is likely to have an impact on the way in which the FSA regulate small firms (already a much debated subject) and could change local authorities' approach to routine health and safety inspections. In many instances however the code will simply bolster the good practices already being adopted (for example, the OFT's work on prioritisation principles, highlighted in the October edition of our competition e-bulletin). Whilst this code can be seen as a set of common sense rules for using public resources, BERR clearly hope that the discipline it enforces will encourage such good practice to spread and will help reduce unnecessary regulatory interventions.