Independent review of the NSW Regulatory Policy Framework – final report

Regulator strategy Regulation New South Wales

The regulatory policy framework is the backbone of the public sector and a critical determinant of how the Government delivers its services effectively. In one way or another, regulation (good and bad) affects every single individual in NSW through different stages of their lives.

It is therefore imperative that regulation is managed effectively to deliver the best outcome for NSW businesses, consumers and the community at large.

Good regulation balances multiple public interest imperatives: those of safety and consumer protection, as well as productivity, efficiency and innovation. All these outcomes are important and work together to provide net benefits for society.

Getting regulation right is important. Incidents such as the Grenfell Tower fire in London and, closer to home, discussions around building safety, liquor lockout laws and swimming pool fencing regulation, all attest to the importance of having a robust framework that provides guidance to public servants on regulatory best practice. It also provides Ministers and policymakers with assurance that they have the best evidence available to inform their decisions.

There is a significant cost to NSW businesses for activities to support regulatory compliance, with some estimates of around $10billion in compliance costs each year. Compliance with regulatory requirements can also be seen by business as preventing them making changes to grow their business.

Regulation done well could, in the long run, boost the NSW economy by around $6 billion. This is based on the Productivity Commission’s estimate that a 20 per cent reduction in regulatory compliance costs would increase Australia’s GDP by 1.31 per cent in the long run.

The NSW Auditor-General’s recent report on red tape reduction outlined shortcomings in the Government’s ability to prevent or reduce red tape, and lack of sufficient oversight of the regulatory policy process to improve the quality of regulatory proposals.

The Panel’s recommendations will raise the quality of regulation in NSW, with the ultimate goal of achieving better regulatory outcomes for the community.

The Panel has identified how NSW’s current approach to regulating impacts businesses, consumers and the community. We then considered how those impacts are linked to NSW’s current regulatory framework and practices and where these can be substantially improved. The key findings are set out below.

Key findings

  • A better approach to reducing red tape is needed
  • Often the problem is not regulation itself, but people’s experience of that regulation
  • Many aspects of the existing Regulatory Impact Assessment framework have become a ‘tick the box’ exercise that adds limited value to the regulatory and policy development process
  • The current framework lacks sufficient rigour in how regulation is managed, or safeguards to prevent a ‘regulation first’ response to public policy issues




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