Friday, January 18, 2008

Risk and regulation - good and bad news on regulatory reform

There was good news on risk and regulation this week. The government launched a Risk and Regulation Advisory Council (RRAC) with the stated aim of improving the way risk to the public is understood and managed by government. No one can object to that objective.
The agenda of RRAC will be set after consulting stakeholders but topics under consideration include obesity, regional regeneration failures, systemic risk aversion and aspects of corporate governance. The RRAC needs to create a better awareness of the benefits and costs (including unforeseen consequences) of regulation as a response to risk.
The RRAC replaces the Better Regulation Commission (BRC). It is vital that the RRAC continues with the BRC's mission to identify how to:
1) reduce unnecessary regulatory and administrative burdens;
2) and ensure that regulation and its enforcement are proportionate, accountable, consistent, transparent and targeted

It is promising that there is someone from the third sector on the RRAC. Hopefully the RRAC will make an effort to listen and look at how regulation can affect the third sector’s small and medium enterprises. Just as small businesses in the private sector are engines of wealth creation so their equivalents in the third sector are generators of social value.

However, elsewhere things are looking less promising for regulatory reform. David Orr, the Chief Executive of the National Housing Federation, set out in the Guardian this week the dangers of the government’s housing bill – particularly how it will significantly extend the regulatory reach of the regulation over the neighbourhood services of housing associations. I had hoped that the recasting of social housing regulation would streamline arrangements.

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