NZ Treasury To Coordinate Quality Of Regulation Across Government

by Mary Swire, for LawAndTax-News.com

21 May 2008

New Zealand's Government on Monday announced changes that will allow a more coordinated approach to improving the quality of regulation, and strengthen its focus on reducing compliance for business.

Finance Minister Dr Michael Cullen, and Commerce Minister Lianne Dalziel announced that Treasury will have strategic oversight of the whole regulatory quality system, freeing up the Ministry of Economic Development (MED) to address regulations that might be seen as inhibiting growth or innovation at firm and industry levels.

The Ministers explained that Treasury is the best choice to act as the central agency for regulatory oversight because of its focus on state sector performance and value for money, and is well-placed to assess the impact of regulation on the performance of the economy as a whole.

Dr Cullen went on to state that:

"These mandates provide Treasury with the broad levers required to influence departmental performance."

"The MED will be able to concentrate on its role as the government primary adviser on reducing business compliance so that firms can improve their productivity, innovation and international linkages," Lianne Dalziel added, continuing:

"MED and Treasury will work very closely together to ensure that this new regime promotes a culture of excellence through the public sector to ensure effective, outcomes-focused regulation at the level of industry and the firm."

Ms Dalziel told delegates at the 2nd Annual New Zealand Regulatory Evolution Summit in Wellington that currently, departments tend to see regulatory impact analysis as an adjunct to, rather than an integral part of, the policy development process.

Quality regulation occurs when the need for robust analysis in the policy development process is linked to public sector accountability and performance, Ms Dalziel stated.

"In other jurisdictions this has led to the role being undertaken by a central agency, which is our intention by moving the Regulatory Impact Analysis Unit of MED to Treasury. This will enable a whole of government approach to strengthening RIA quality assurance by using Treasury's existing relationships arising from its second opinion policy advice and Vote analysis functions," she continued.

MED will retain responsibility for assessing the cumulative impact of regulation on business; reducing business compliance costs; understanding the effect of regulation on economic growth; setting high standards in regulation design; studying the impacts of regulation on business through benchmarking and other tools; and reviewing the efficiency and effectiveness of regulatory regimes the impact on economic development, Ms Dalziel concluded.

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