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Minding the Gap

Minding the Gap: Appraising the promise and performance of regulatory reform in Australia

Peter Carroll
Rex Deighton-Smith
Helen Silver
Chris Walker
Copyright Date: 2008
Published by: ANU Press
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  • Book Info
    Minding the Gap
    Book Description:

    'Mind the Gap!' is an almost iconic exhortation, originating in the London Underground, warning travellers to be careful when navigating the 'gap' between the platform and train. In this volume, Peter Carroll, Rex Deighton-Smith, Helen Silver and Chris Walker retrospectively assess the 'gap' — no less dynamic and perilous in a public policy context — between the promise and performance of successive waves of regulation in Australia since the 1980s. Regulatory bodies exist to exercise what might be broadly termed 'control functions' and, by nature, tend to be conservative both in their culture and operations. Institutional conservatism does not, of necessity, preclude the exercise of creativity and foresight, both of which are sorely required if government is to successfully meet the challenge of delivering more effective and less costly regulation. The business and policy environment is complex, the risks are great and the rewards of success and the costs of failure will be enormous. The true measure of success will be how effectively we are able to close the gap between promise and performance.

    eISBN: 978-1-921313-16-5
    Subjects: Political Science

Table of Contents

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  1. Front Matter
    (pp. i-vi)
  2. Table of Contents
    (pp. vii-viii)
  3. Acknowledgements
    (pp. ix-x)
  4. Contributors
    (pp. xi-xii)
  5. Foreword
    (pp. xiii-xvi)
    Gary Banks

    The GOVNET conference stream from which the chapters in this volume were drawn was titled ‘Rethinking Regulation’. ‘Rethinking’ was what the Regulation Taskforce felt was called for if the causes, not just consequences, of the many poor regulations we observed were to be addressed. That, of course, is easier said than done, as some of the chapters in this volume attest.

    The challenge facing aspiring reformers in this area reflects the reality, as one senior public servant put it, that ‘no regulation is an orphan’. There are persistent demands on governments to ‘do something’ about issues of importance to particular...

  6. Prologue
    (pp. 1-4)
    Peter Carroll

    In a 2008 address to the Museum of American Finance entitled ‘Lessons from Financial History’, Niall Ferguson, the Laurence A. Tisch Professor of History at Harvard University and William Ziegler Professor at the Harvard Business School observed:

    Most regulations are improvised in the aftermath of a crisis. This is how regulations, generally, are produced. They almost immediately become inappropriate. So, regulators are always chasing the historical process. Like generals, they are always fighting the last war, never the next one.¹

    The quote is interesting and catchy — but almost totally incorrect as regards the assertion that regulations arise primarily in response...

  7. Chapter 1. Introduction
    (pp. 5-16)
    Peter Carroll

    The aim of this monograph is to examine successive attempts by the Commonwealth government to improve the quality of the processes by which business regulation is made. Those attempts took place, for the most part, within three broader waves of microeconomic and regulatory reform that have occurred over the last 25 years. The first of these, which is not examined in this book, commenced in the early 1980s under the first of the Hawke ALP governments and was marked by major developments such as the floating of the dollar, substantial reform of financial market regulation (including de-regulation) and the rapid...

  8. Chapter 2. The Regulatory Impact System: Promise and performance
    (pp. 17-32)
    Peter Carroll

    The aim of this chapter is to provide an assessment of the performance of the Commonwealth government’s Regulation Impact Statement (RIS) system, a system first introduced in 1986 but modified and strengthened in 1996 as part of a move to further improve the quality of new and modified regulation and, hopefully, minimise adverse impacts on business and economic performance. It argues that, while its proponents were keen to see its effective implementation in all departments and agencies — proposing that, as part of the broader process of regulatory reform, it would lead to an improved quality of regulation — actual practice showed...

  9. Chapter 3. Measuring Regulatory Performance
    (pp. 33-50)
    Peter Carroll

    The aim of this chapter is to describe and assess the development and use of the system of regulatory performance indicators (RPI) by the Commonwealth Government in the period 1998-2006. The RPI were designed to provide decision-makers with standardised, system-wide data on the largely RIS-related processes by which departments developed regulation with regard to business. As such, they were early examples of a more general, international move to improve regulatory quality and performance, in line with the urgings of the OECD (see, for example, OECD 2004a; and 2004b).

    The chapter concludes that the value and use of the RPI was...

  10. Chapter 4. The mirage of rail reform: building regulatory capacity in policy sectors
    (pp. 51-62)
    Chris Walker

    The title of this chapter is somewhat provocative and is intended to focus attention on the question of whether or not regulatory reform in Australia is only about cutting red tape and achieving national consistency. My experience as a state government official for some 15 years, in both line and central agencies, suggests that there exists a dominant view that regulatory reform will only deliver value when it is about achieving simplicity and consistency. This appears to be the orthodox view across all governments at both Commonwealth and state levels. There is, of course, considerable value in creating regulatory environments...

  11. Chapter 5. The national reform agenda: origins and objectives
    (pp. 63-72)
    Helen Silver

    The aim of this chapter is to examine the origins and the objectives of the National Reform Agenda. The Council of Australian Government’s (COAG) National Reform Agenda is an important reform initiative that is close to the heart of many public policy makers across Australia. The Victorian Government has been advocating since 2005, particularly through COAG, that all governments need to develop a new National Reform Agenda with regulatory reform and human capital at its heart.

    Throughout 2006, officials from all jurisdictions worked hard to make the National Reform Agenda (NRA) a reality. As work advanced on this — whether through...

  12. Chapter 6. Rethinking Regulation
    (pp. 73-88)
    Peter Carroll

    The aim of this chapter is to assess the Report of the Commonwealth Government’s Taskforce on Reducing the Regulatory Burden on Business (the Banks Report), released in April 2006 and the government’s endorsement of those recommendations (Australian Government 2006a; 2006b). The endorsement, followed by the beginning of the implementation of the recommendations, constitutes, together with the items encompassed in the National Reform Agenda, a centrepiece of the third wave of regulatory reform in Australia. The focus of the chapter is the report’s recommendations with regard to the system for making regulation with regard to business, particularly the regulation impact statement...

  13. Chapter 7. Process and performance-based regulation: challenges for regulatory governance and regulatory reform
    (pp. 89-104)
    Rex Deighton-Smith

    Recent decades have seen a substantial move by regulators in Australia, as in many — perhaps most — other OECD countries, toward adopting performance-based and process-based regulation, in preference to traditional prescriptive regulation. Performance based regulation can be defined as regulation that specifies required outputs, rather than inputs and thus provides a degree of freedom to the regulated to determine how they will achieve compliance. Process-based regulation specifies risk identification, assessment and control processes that must be undertaken, documented and (usually) audited. It is most commonly used in contexts in which there are multiple risk sources and multiple feasible risk controls.


  14. Chapter 8. Conclusion
    (pp. 105-112)
    Peter Carroll

    As noted, the bulk of the chapters in this book other than the introduction and this conclusion were presented originally as separate conference papers on a related theme. Hence, while each of the papers addresses an aspect of the second or third waves of regulatory reform that have taken place in Australia since the mid-1980s, focused on reforms to processes, they were not designed to fit together in a coherent whole as chapters in a book. Moreover, the papers were presented before COAG had reached any final agreement on the National Reform Agenda (NRA) — the third wave of reform. Nevertheless,...