UK Regulators Continue to Improve
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Issued on 26 February 2010
Regulatory bodies in the UK continue to make good progress putting better
regulation principles into practice, according to a set of new reports published
today by the Better Regulation Executive.
The new reports, on the Vehicle Certification Agency (VCA), the Financial
Reporting Council (FRC) and the Veterinary Medicines Directorate (VMD), provide
a snapshot of how regulators are implementing the Government’s “better
regulation” initiative, examining how they match up to the principles of
effective regulation set out by Sir Philip Hampton in 2005.
The VCA was found to be a highly customer-focused organisation that has
impressive relationships with its stakeholders. It demonstrated a good
understanding of the industries it regulates on behalf of central departments,
seeking to secure compliance in a way which minimised burdens on business. The
report also put forward a number of recommendations for how it might improve its
regulatory work. These included considering the scope for developing a more
joined-up approach with other bodies that effectively act as co-regulators, and
considering, alongside its government sponsors, expanding the range of civil
sanctions in place to reduce the current reliance on criminal prosecutions.
The FRC was praised for adopting a positive approach to the principles of
better regulation across most areas of its work. In particular, the review team
was impressed by the good balance struck between stability and economic growth,
and the strong support the FRC had from its main stakeholder groups. Its “soft
law” approach to raising standards of corporate governance in listed companies
was also found to be world-class. Alongside this the FRC was encouraged to
review certain areas of its work. For example, the report argued it would
benefit from broadening its stakeholder base to ensure small businesses and the
investor community were more involved.
The VMD’s review was positive and showed that it was performing well in a
number of areas. In particular, the strong emphasis on providing advice and
guidance to its stakeholders, primarily demonstrated by its annual publication
of the Veterinary Medicines Regulations, was commended. Its work to reduce the
administrative and financial burden on businesses when requesting information
was also impressive. The report recommended that the VMD publish a number of its
policies to make it easier for businesses to navigate the regulatory landscape.
It argued that stronger relationships with policy officials in the UK and the
European Union would help to further reduce the administrative burden stemming
from veterinary regulations.
1. The reports published by the Better Regulation Executive on the Vehicle
Certification Agency, Financial Reporting Council and Veterinary Medicines
Directorate can be found at www.berr.gov.uk/what wedo/bre/inspection-enforcement/implementing-principles/reviewing-regulators/HIR
2. The review teams were drawn from the Better Regulation Executive within
the Department for Business, Innovation and Skills and from government and the
regulatory sector, including the Security Industry Authority, Human
Fertilisation and Embryology Authority, Environment Agency, the Gambling
Commission and the Care Quality Commission.
3. The Hampton Implementation Review process, which examined a total of 36
national regulators, follows two independent reports by Sir Philip Hampton and
Professor Richard Macrory on making inspection and enforcement of regulation
4. The Hampton Review in 2005 - led by Sir Philip Hampton - recommended an
end to the one size fits all approach to regulation and that regulators should
take a risk-based approach to enforcement and information-gathering. Among its
findings were that regulators should carry out inspections only when needed and
avoid unnecessary form-filling and duplication of effort or information.
5. In 2006 Professor Richard Macrory's review of penalties for failure to
comply with regulatory obligations recommended that regulators should focus on
outcomes, rather than action. He recommended that sanctions should be aimed at
changing the behaviour of non-compliant businesses and eliminating any financial
gain from non-compliance.
6. Examples of how individuals and businesses are benefiting from changes to
regulation can be found on www.betterregulation.gov.uk. The site also invites
suggestions for what else can be done to reduce red tape.
Department for Business, Innovation & Skills
About the Author
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Article Published/Sorted/Amended on Scopulus 2010-02-28 15:56:09 in Business Articles