Co-ordination across government


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10.2. What mechanisms are in place for managing and co-ordinating regulatory reform across different levels of government to ensure consistency and a transparent application of regulations and clear standards for regulatory quality?

Rationale for the question

Multi-level regulatory governance is becoming a priority in many countries. High quality regulation at a certain level of government can be compromised by poor regulatory policies and practices at other levels, adversely affecting business investment and economic performance. The most common problems that affect the relationship between the public and the private sectors are duplication, overlapping responsibility and low quality. These affect public service delivery, public perceptions, business services and activities, as well as investment and trade. Following certain principles and good practices for high quality regulation in a coherent way as well as facilitating co-ordination among regulatory institutions at different levels of government can bring improvements to the regulatory system as a whole.


Related PFI questions:

Various aspects of intra-governmental cooperation and dialogue are covered in the following questions:

Question 2.5 on IPA dialogue mechanisms

Question 4.4 on competition policy evaluation and intra-governmental communication

Question 9.1 on cooperation to establish infrastructure priorities

Key considerations

Applying regulatory principles and quality standards at all levels of government is fundamental to maintain economic dynamism and a country’s attractiveness. A regulatory system is by nature fragmented and needs a certain degree of co-ordination to ensure coherence and compatibility of policy objectives.


Regulatory governance cuts horizontally across policy areas and often confronts traditional, unconnected and competing institutions.  Some parts of government might not understand, or even actively resist, both regulatory compliance and innovation. Devolution of regulatory powers to sub- and supra-national levels of government implies that regulatory reform now involves several layers of government, especially for implementation, enforcement and compliance.

Effective co-ordination requires a clear definition of regulatory powers which avoids overlapping responsibilities, together with negotiation mechanisms to surmount decision-making divergences. All parts of central government – the executive, the legislative and the judiciary – have key roles to play in supporting the regulatory quality process. The executive, composed of line ministries, is the most active regulator in many countries. OECD country experience suggests that some central co-ordination and control is essential for successful regulatory governance. Even if each regulatory institution has its own objectives and goals, too often incentives to undertake regulatory reform are unevenly disseminated.

Officials’ capacities might vary across the government, and capacity building and training is essential, especially in innovative regulatory environments undertaking reforms and using performing policy tools.

When new institutional structures are set up, they usually encounter resistance from existing structures and often have inadequate resources and authority. Innovative institutions and co-ordination arrangements might be controversial and find established interests hostile. This should not discourage reform. One of the most powerful mechanisms for co-ordination is communication, both between the State and private sector, and among government institutions. High political support is vital, but acceptance of reform from the public as well as within the public administration is also essential for success.

A key element to enhance communication is greater transparency. Transparency is an essential part of all phases of the regulatory process: from the initial formulation of regulatory proposals to the development of draft regulations, through to implementation, enforcement, review and reform as well as the overall management of the regulatory system. Transparency reduces the chances of regulatory capture, facilitates enforcement, reduces uncertainty, enhances the sense of ownership by regulation makers and users, and builds trust in public policy by intensifying accountability.

Policy practices to scrutinise

An assessment of Question 10.2 calls for an examination of the following issues:

  • Co-ordinate regulatory reform at different levels of government
    Institutional co-ordination mechanisms derive in some cases from constitutional arrangements, but there are also informal co-ordination mechanisms that facilitate the design and implementation of regulatory policy. Some countries have established permanent discussion tables, ad hoc conferences or formal policy dialogue initiatives between the centre and lower levels to minimise potential conflict and to find ways to harmonise regulatory policy.
  • Integrate transparency in the regulatory process
    To facilitate communication and transparency and improve regulatory clarity and consistency: consult with interest parties, draft in plain language, simplify and codify legislation, create registers of existing and proposed regulation, and use ICT to disseminate regulatory material.
  • Manage and coordinate regulatory reform through responsible institutions
    Effective and credible mechanisms inside the government for managing regulation are indispensable. A selection of institutional mechanisms is provided in Box 1.
  • Harmonise regulations internationally
    The regulatory environment where citizens and businesses operate is composed of complex layers of regulation stemming from supra-national, national and sub-national levels of government. In this area regulatory harmonisation is important and requires adequate resources.


Box 1. Institutional mechanisms for multi-level coordination


  • Draft primary legislation and generally delegate responsibilities for secondary legislation and regulation.

Line ministries

  • Most active in making regulations (e.g. secondary legislation).
  • Specialist law drafting offices within line ministries increasingly help to enhance regulatory quality.


  • Ultimate guarantor of transparency and accountability.
  • Is regulation fully consistent with primary legislation?
  • As judicial review is often costly and time-consuming, many regulated groups, particularly SMEs and individuals, are not likely to use the judiciary to defend their rights, resulting in lower levels of compliance.

Central oversight bodies

  • Co-ordinate, monitor regulatory quality.
  • Offer technical support and advice.
  • Associated with an effective, comprehensive regulatory policy.
  • Key engine of reform through advocacy at centre of government.
  • More effective if placed close to traditional management functions such as budgeting or presidency, rather than in line ministries tied to specific policy and regulatory functions.
  • A careful balance is needed: too much concentration of responsibility, authority and expertise in one place may undermine interest, commitment and responsibility in other parts of government; too little power and the body will be ineffective.
  • Regulatory quality oversight bodies in OECD countries (pp. 63-67)

Advisory bodies

  • Involved at all stages of the regulatory process but commonly participate early on to assist in defining positions and options.
  • Depending on their status, authority and position in the decision process, they can greatly influence final decisions (building consensus), or merely be one of many information sources (providing expertise).
  • Tasks mainly involve drafting and reviewing proposals, or reviewing existing regulation, as well as policy planning.
  • Involve members from outside of government.

Private stakeholders
Independent regulators

  • Can identify priorities, propose specific reforms and advocate for regulatory quality.
  • Neutral regulatory oversight of liberalised and privatised sectors.
  • Prudential oversight of competitive markets.
  • Should operate under the same disciplines as other rule-makers when making rules or interpreting them.
  • Should be competent, accountable, transparent, accessible and capable of resisting capture by interest groups, while being responsive to general political priorities.

These considerations suggest the PFI user should assess the mechanisms for co-ordinating regulatory governance in a complex government structure, ensuring consistency and transparency in the application of regulations, including:

  • formal or informal mechanisms for co-ordinating regulatory development and its reform. It is important to verify if the government has designed and endorsed clear standards for regulatory quality and confirm that the mechanisms comply with these standards. The effectiveness of the co-ordination mechanisms and the degree to which all relevant stakeholders are involved should be assessed. This should be analysed at both the central, and the local and the supranational levels. International law validity, international treaties and harmonisation mechanisms for regulation are essential elements for this area.
  • mechanisms for transparency, especially if evaluation processes are used to ensure a well-functioning regulatory system (see transparency tools under Question 10.4). This might include a detailed list of any clear regulatory quality standards formalised and used by the government, including principles, manuals or toolkits. The use of regulatory and policy tools (not included among the tools detailed in the next three sections), as for example plain language drafting requirements. To complete the assessment, the PFI user could collect any indicators related to regulatory institutions to map the institutional situation, such as time series of conflict resolution, perception surveys, human and financial resources allocated, and the evaluation of policies.



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