The Regional Capacity Building Seminar on Regulatory Impact Assessment (RIA) held in the framework of the Good Governance for Development (GfD) for Arab Countries Initiative, Working Group on Public Service Delivery, Public-Private Partnerships and Regulatory Reform, took place in Istanbul, Turkey, on 20 November 2007, under the hosting of the Prime Ministry of Turkey.
Participants to the meeting
There were 54 participants attending the seminar. Seven MENA countries: Egypt, Jordan, Morocco, Palestinian National Authority, Syrian Arab Republic, Tunisia and Yemen; and six OECD countries were represented: Czech Republic, Ireland, the Netherlands, Norway, Spain and Turkey. Appart from the Prime Ministry, numerous institutions from Turkey participated actively in the seminar: the Ministry of Industry and Trade, Ministry of Environment and Forestry, Ministry of Agriculture and Rural Affairs, the Turkish Competition Authority, the Capital Markets Board, the Energy Market Regulatory Authority, the Banking Regulation and Supervision Agency, the State Planning Organisation, the Economic Development Foundation, the Economic Policy Research Foundation of Turkey and the Automotive Manufacture Association of Turkey among others. DAI Europe also participated in the seminar.
The meeting continued the regional policy dialogue and made progress on the exploration of Regulatory Impact Analysis (RIA) as a powerful evidence based policy tool. It was an opportunity to share some of the experiences in MENA and OECD countries to build capacities and create momentum to promote regulatory quality in the MENA region. Being the first seminar of the GfD Initiative exclusively focused on RIA, the goal was to highlight the importance of integrating the use of RIA in the policy decision-making.
Content of discussions and policy dialogue
The meeting was opened by Mr. Yuksel Ozturk , General Director of Laws and Decrees, Prime Ministry of Turkey, and Mr. Mustafa Baltaci, Coordinator of the Better Regulation Group, Prime Ministry of Turkey by introducing the context of regulatory management in Turkey; Mr. FethiBdira, General Director, Public relations, Prime Ministry of Tunisia gave opening remarks as chair of the Working Group on Public Service Delivery, PPP and Regulatory Reform; and Mr. Carlos Conde, OECD MENA Governance Programme Co-ordinator, Public Governance and Territorial Development Directorate of the OECD Secretariat, framed the event in the initiative’s work.
Setting up an RIA system
RIA is a key regulatory policy tool to support more evidence based decision making. It has been spread among OECD countries during the last two decades, the OECD supported this process by setting a number of principles and helped on the design of this tool, which has presented differences in each country. There are some key elements to be taken into account when starting the application of RIA in a regulatory system. Some of them were repeatedly mentioned as for example high political support, the creation of a RIA team inside the administration and the integration of RIA at the beginning of the regulatory process. In some cases, external incentives are triggering the development of a systematised assessment of impacts. To have a complete understanding of this tool the distinction between RIA as a system and as document was highlighted, RIA should not be only a process of filling up a document, it should be an iterative and open process.
According to OECD experiences, RIA was presented as a useful element to cut red tape. A process of administrative simplification does not necessary imply a reduction of public administration, resulting in a reduction of public employment, but it is more about simplifying “administrative procedures citizens, businesses and public administration face”.
The RIA process: targeting, methodology and data collection
To offer evidence based analysis it has been recommended to “try to monetise as many [regulatory] impacts as possible, and when this is impossible, at least describe the impacts properly” to help taking the right decisions. Assumptions about the elements when analysing impacts are very important, and results may change depending on these assumptions and the analytical model. How and where to get the information from it is then important, because it will determine the results of the work.
There were examples of RIA from Norway and the Netherlands. An important element to take into consideration is the fact that RIA does not always determine final decisions, if RIA is well placed at the beginning of the decision making process, it may contribute but does not capture the decision making.
RIA helps respecting policy principles by focusing more attention on them, and orientates regulatory makers about possible impacts that could be avoided, an example mentioned was the promulagation of high trust approaches dealing with permits. To maximise benefits of RIA, each regulatory institution creating regulation should be the one undertaking the analysis, and then there should be supervision and monitoring of the quality of RIAs and regulations. But RIA should not be seen as a bigger burden for officials, otherwise there is a high risk of failure.
A tool for regulatory transparency: communication and public consultation
RIA is a policy tool that increases transparency in the regulatory process. There might be two dimensions for this: on the one hand, RIA can only be effective if it calls for public consultation with stakeholders affected by regulatory decisions to be taken, different forms of consultation were explored as well as some of the challenges that public administration faces; on the other hand, RIA can set standards applicable among regulatory institutions to promote common communication means inside the administration, contributing to the use of the “same language”. All this was explored from a practical perspective using some real cases.
It was discussed how to persuade key groups for using RIA and create a sense of ownership for all relevant players, among them politicians, civil servants, legislators, social partners and NGOs, and media. This was defended as an essential step to the change of administrative culture needed for RIA implementation.
Challenges undertaking RIA pilot projects and introducing RIA systems
Many practitioners agree: “RIA is learnt by doing”. Pilot projects have been used in a number of countries to test the feasibility of an RIA system in practical terms. Arab and OECD countries discussed some of the lessons learnt about designing and implementing RIA, highlighting those elements that have contributed to experiences of success. Progressive regulatory reform programmes, imaginative approaches to training and communication were key in some of the cases proposed. The goal of rule makers should be to obtain the compliance of correct rules, for this, capacity building is needed as well as efforts to create realistic regulation. From the MENA region, both, Egypt and the Palestinian National Authority shared their recent developments and efforts regarding regulatory reform, promising efforts aiming at the improvement of the economic environment.
Regulatory reform in Turkey was fostered by OECD work in 2001. A complete assessment of regulatory capacities with the aim of designing policy recommendations was delivered. Following this, high political commitment and the international environment were the drivers to great efforts on recent years. A Better Regulation Group was created at the centre of government, and the most important recent advances have been on the reduction of red tape and administrative burdens, with the establishment of "one-stop" offices at regional level in November 2006, the elimination of 1,085 outdated government circulars in January 2007, the improvement of user-friendly e-government applications, and initiatives on capacity building and technical support.
The systematic use of RIA has been recently launched. With the support of the European Union, there was a successful pilot phase in 2006. Finally, the government issued a circular in April 2007 on the implementation of RIA and detailed guidelines were adopted. The Prime Ministry of Turkey is coordinating all these reforms which are effectively enhancing the quality of regulation and improving the economic environment in Turkey.
Outcomes and Future Work of the Working Group
Considering the background of the work on regulatory reform in the GfD context, delegates have been asked to contribute in the definition of next steps to take and priorities. In this regard, there were discussions on the following elements:
• Improved common understanding in the region about Regulatory Impact Analysis and challenges to be faced when developing evidence-based regulation.
• On-going broad regulatory reform programmes were shared among MENA partners, and there were discussions on how to find ways to cooperate and create synergies.
The application of RIA is only part of broader efforts needed on improving regulatory quality. These kind of activities serve as an international forum to underline priorities in the area for MENA and OECD countries together, thinking together about approaches to take facing common challenges, “co-operation improves performance”.
Session 1: Setting up an RIA system
OECD Secretariat: OECD good practices for setting up an RIA system
Turkey: Setting up the RIA System in Turkey
DAI: RIA – An Art and not a Science
Netherlands: Reducing Administrative Costs
Session 2: The RIA process: targeting, methodology and data collection
Norway: RIA - Biofuels as an example
Netherlands: Business Impact Assessment
Session 3: A tool for regulatory transparency: communication and public consultation
Czech Republic: RIA: Communication – building credibility
Turkey: Need for RIA and Public Consultation in Turkey
Norway: A tool for regulatory transparency
Session 4: Challenges undertaking RIA Pilot Projects and introducing RIA systems
Ireland: Regional Capacity-Building Seminar - Some Lessons from Regulatory Impact Assessments
Palestinian National Authority: The Palestinian Experience with RIA
Turkey: Implementation of Regulatory Impact Analysis and the Pilot Project in Turkey
Egypt: Economic Governance in Egypt - Challenges in introducing RIA (Ppt / Speech)
Building a Framework for conducting RIA: Tools for Policy-Makers. version 1.2
Note on the programme of work on Regulatory Reform
Evaluation of EU impact assessments. Tom Ferris.
Better Regulation DAI