OVERVIEW
Good regulatory practices can determine the prospects for policy success or failure. Studies show strong correlations between regulatory quality and economic growth, better governance quality and higher incomes per capita. Eliminating cumbersome procedures and administrative burdens is sometimes a necessary, but usually insufficient approach to sustainable regulatory reform. The Regulatory Policy and Management (RPM) Group was established within the Governance Global Practice (GGP) to increase the focus on institutional, whole-of-government and systemic aspects of regulatory reform. The objective is to strengthen the governance dimension of regulatory reform and, in turn, improve the sustainability and effectiveness of regulation as a core tool of government. RPM addresses these opportunities through a mix of lending tools, analytical work, technical assistance, capacity building and global engagement. Priority issues include better use and understanding of Regulatory Impact Analysis (RIA) and Notice-and-Comment systems, as well as supporting better integration of regulatory reform initiatives into broader public sector reforms.
THE CHALLENGE
The role and impact of regulation has drastically increased over recent decades. As policy-making through spending and taxation has become constrained, regulation is becoming governments’ preferred tool of choice. Efficient management of the regulatory state requires tools and mechanisms similar to those applied for other core tools of government. The institutional dimension and quality assurance mechanisms of regulation-making, review and delivery, however, is far less developed than in the fields of taxation and spending. Many countries experience a large implementation gap between regulation “on the books” and the actual regulatory practice at the point of delivery.
APPROACH
The Regulatory Policy and Management Group draws upon an extensive network within the World Bank Group (WBG), as well as with external partners such as the OECD and the United Kingdom’s Better Regulation Delivery Office.
The RPM Group offers expertise and support in the following areas:
Regulatory Reform Diagnostics: The Regulatory Policy and Delivery Review assesses regulatory institutions, processes and tools, and provides a baseline for prioritized regulatory governance reforms. Additionally, the team currently works on global regulatory governance indicators and shorter indicator-based country overviews.
Regulatory Reform Tools and Institutions: This includes support to systems for Regulatory Impact Assessment (RIA), process re-engineering, alternatives to regulation, regulatory reform units and committees leading and coordinating regulatory reforms.
Linking governance systems and investment climate reform: Embedded in the GGP, the RPM team is well positioned to link quick-win efforts to the sustainable and systemic improvements needed to avoid recurring cycles of regulatory failures.
Governance of Regulators: Looking at cross-cutting governance features of regulators, including the level of consistency in the use of regulatory governance tools, transparency measures, etc.
Regulatory Delivery: This includes improving the effectiveness of inspections, the use of 'one-stop-shops,' and more effective use of information technology systems and solutions.
PROGRAMMING EXAMPLES
EU Actionable Regional Governance Indicators
Challenge: The 6th Cohesion report of the European Commission shows that governance problems not only delay the implementation of Cohesion Policy programs, but also reduce the impact of these investments.
Approach: The RPM Team is assisting the European Commission in the development of regional indicators for regulatory governance practices in EU member states, focusing on both the design and delivery of regulation, and the content and process of regulatory governance.
Expected Results: The actionable governance indicators will improve EU Member States’ understanding of their administrative capacity to implement and deliver national and sub-national economic development initiatives, and thereby help identify areas for reform.
The Good Regulatory Practice Program
Challenge: Many reforms are piecemeal and failing to generate system-wide changes. While international competitiveness and obligations under international agreements are putting growing pressure on countries to develop transparent and effective regulatory frameworks, the increasingly connected world has raised not only citizens’ expectations on government accountability and openness, but also on the ability to play an active part in the design of new policies.
Approach: The multi-year Good Regulatory Practice program focuses on collecting lessons and the development of a number of regulatory tools to enhance transparency, accountability, and dialogue, managed collaboratively by the World Bank’s Governance, Development Economics and Trade & Competitiveness Global Practices. In particular, the program covers (i) Diagnostic Exercises; (ii) Tools for Evidence-Based Regulatory Policy Making; (iii) Notice and Comment Systems; and (iv) Business-to-Government Feedback Mechanisms.
Expected Results: In the long run, the output of this project will foster good regulatory practices in World Bank client countries. Introduction of good regulatory practices lead to increased regulatory quality which, in turn, leads to increased investment, job creation and productivity gains. It also leads to greater achievement of societal objectives underpinning regulations.
Streamlining Public Services in Albania
Challenge: The Government of Albania was elected in 2013 with a mandate to reduce corruption. It has asked for RPM’s assistance to fundamentally change the delivery of public services, reduce the scope for corruption, foster a citizen-focused ethos for provision of public services, and reduce the time and cost of service delivery both for citizens and non-governmental organizations by an average of twenty-five percent.
Approach: RPM is supporting regulatory reform, process re-engineering, automation and the establishment of one-stop-shop citizen service centers (CSC).
Expected Results: To fully automate ninety percent of the selected government services for online service provision by 2020; enable the CSCs to offer over 300 national government services from multiple ministries and agencies; and establish mechanisms for citizen feedback on the quality and timeliness of service delivery to provide the necessary data to deliver better performance and services.
Regulatory Governance in Kazakhstan
Challenge: In 2014, the Government of Kazakhstan launched a major long-term development strategy with the objective of accelerating the transformation of the economy into a diversified, private-sector-driven, developed economy by 2050. It has requested the Bank’s assistance in improving the regulatory framework faced by the private sector.
Approach: RPM is supporting the Government with actions along multiple dimensions, including regulatory streamlining, a comprehensive policy for better regulation and establishment of a Regulatory Impact Assessment (RIA) system.
Expected Results: Reduction of the number of permits by more than fifty percent, and introduction of systemic procedures for assessing economic impact of new and existing regulation.
Private Healthcare Regulation in Saudi Arabia
Challenge: A growing population in Saudi Arabia has created big demands for healthcare. In response, the government is promoting private healthcare providers and has requested RPM to review regulatory frameworks for private healthcare.
Approach: Analysis of the current regulatory framework for private healthcare provision, and benchmarking towards international best practices.
Expected Results: Regulatory arrangements to ensure a level playing field that fosters a favorable investment climate, while assuring service quality of private health provision and strengthening of the government’s stewardship role.