The regulatory state has become a much used paradigm in the study of public policy in recent years. A regulatory state is one in which regulation becomes a key mode of interaction between the state, businesses and citizens. Its origins can be traced back to the New Deal era in the United States and it was used by Chalmers Johnson in his work on Japan as a polar opposite to the developmental state. Majone then developed the idea to apply to the European Union, where it was particularly relevant given the relative lack of fiscal policy instruments.
It has been particularly developed in the UK by Michael Moran, who compared it with earlier state forms such as the ‘command state’. Moran saw the regulatory state as supplanting these less transparent and accountable state forms. Over time, however, he has become more cautious about the regulatory state because of one question: ‘Who regulates the regulators?’ It is a function which Parliamentary committees seek to perform – with some success, although there is always a temptation for politicians to chase headlines.
More generally, additional regulation is often driven by scandals of one kind or another. These lead to media demands for action and politicians respond by announcing ‘tough new measures’. These measures increase the transaction costs for businesses and for citizens without necessarily achieving the policy objectives. There have been particular concerns about the costs that regulations impose on smaller businesses which are important generators of employment.
The Coalition Government has been attempting to reduce the regulatory burden while preserving essential protections for citizens and the environment. It must also comply with EU law, although it has been suggested in the past that the UK tends to ‘gold plate’ EU regulations. Quite what this means is open to question, but it may simply reflect the fact that the UK is more scrupulous in translating directives into national law and implementing them effectively than some other member states.
The Red Tape Challenge is a cross-government review of regulation. 516 regulations affecting farming in Defra have been examined. One-third of them have been deleted altogether. In another 25 per cent of cases, the Department is looking to substantially simplify them, in particular by reducing 100,000 pages of complicated guidance.
Defra has launched a consultation on reforming environmental guidance and information obligations. It is claimed that this will make it simpler, quicker and clearer for businesses and others to understand and comply with their obligations. There are over 5,000 environmental guidance documents issued by government extending to over 100,000 pages. The overwhelming feedback Defra has received is that it can be difficult, time-consuming and confusing to work out what one needs to do. There are 250 separate data requirements which businesses have to report to different places, at different times, in different formats and with varying degrees of duplication. It is argued that smarter Guidance and Data will help to save businesses time and money, while maintaining or improving the effectiveness of regulations.
Critics argue that this represents a ‘slash and burn’ approach to environmental regulation, but really the devil is in detail. If one takes pesticide regulations – on which I have worked – the regulations necessarily have to be stringent and detailed because one is dealing with toxic substances that represent a potential threat to human and animal health and the environment. However, in one respect it could be argued that the regulations are not drawn tightly enough because they have permitted the emergence of a ‘grey market’ of products that fall outside the scope of the regulations because they no make no claims on the label to be pesticides, but in practice are used as such.
In any event there is scope for getting rid of obsolete regulations, simplifying others and ensuring that new regulations are really necessary or are not more onerous to comply with than they need to be. The experience of the financial services industry brings home the risks of ‘light touch’ regulation but in many areas of agriculture, well-run self-assurance schemes provide much of what is necessary. For example, farmers that are part of voluntary schemes such as the Environment Agency’s Pig and Poultry Assurance Scheme have a lighter inspection regime. As with all government intervention, there are benefits and costs attached to regulations and these shift over time as products, practices and technologies evolve. Finding the right balance requires regular attention to the impact and benefits of regulation.
Professor Wyn Grant joined the Department of Politics and International Studies at the University of Warwick in 1971 and was chair of department from 1990 to 1997. In 2010 he was presented with the Diamond Jubilee Lifetime Achievement award by the Political Studies Association. He was elected an Academician of the Academy of Social Sciences in 2011.