The Future of Law-Making: Proceedings from the 11th annual Measuring Regulatory Performance Conference*

Paul Davidson

For the past 25 years, the OECD Regulatory Policy Division has led international thinking on the importance and use of regulatory management tools. They are designed to assist policymakers in their daily work: responding to calls for government intervention to perceived “problems”, for the betterment of society.

The OECD Measuring Regulatory Performance Programme aims to help OECD countries measure their regulatory performances so as to diagnose success and failures, and to improve regulatory policies, programmes and tools. It also demonstrates how improvements to regulatory governance enhances community well-being. The annual conference programme allows for in-depth discussion with expert practitioners on topics relating to measuring regulatory performance.

The conference brought together more than 100 participants from 22 countries to discuss the future of law?making. It centred on two main themes:

1.     To consider whether, and to what extent, regulatory management tools need adjusting in response to transformative technologies

2.     How transformative technologies themselves can be harnessed to better inform decision-making throughout the regulatory policy cycle

Disruptive technologies are rapidly transforming the way we conduct business and live; they have given rise to new industries and products that were not conceived of even a decade ago. Governments often have no “template” for regulating transformative technologies. At the same time, new technologies and big data can revolutionise the way governments monitor and evaluate regulations to provide better evidence on their actual impact.

The world as we know it is enduring its largest disruption ever, on a scale not previously witnessed. Ensuring that policy decisions are made on the basis of sound evidence has never been more important given its far?reaching consequences. Whilst these findings emanate from a backdrop of digital disruption via platform businesses and two-sided markets – and at a time prior to the current pandemic – they nevertheless remain salient.

Some of the key conclusions from the conference particularly germane are that:

·      Regulatory management tools need to evolve and keep pace to support the development of regulations that are increasingly influenced by digital transformation, and where evidence of anticipated or actual impacts is sparse. This will require more operational flexibility in the way that regulatory management tools are deployed by policymakers.

·      When considering various options to address an existing policy problem, governments could consider promoting experimentation. This may require adjustments to legal frameworks to provide room for such experimentation. Recalling that all regulations are in fact experiments, organisational culture needs to change such that policymakers and regulators are not fearful of being castigated if experiments fail.

The conclusions above were particularly important inputs for forthcoming publications on regulatory policy and covid-19 crisis, especially on the use of new technologies to expand regulatory capacity, and the use of regulatory management tools and the role of regulatory oversight.

In times of crisis it is accepted that some decisions will need to be made urgently, perhaps with limited external discussion and on limited to no knowledge about potential consequences. However, this does not mean that regulatory policy has no role to play in policy decisions. On the contrary, if anything, its role is magnified. In instances where regulations are made based on limited interaction with affected parties, and with limited knowledge about both the magnitude and distribution of impacts, risks are heightened that regulations may not achieve their objectives and are not designed to improve well-being to the fullest extent possible. In turn, this increases the need to establish a strong monitoring regime at the time regulations are made, with sufficient funding provided to agencies in order to collect data to monitor actual impacts “on the ground”. A corollary is that regulations made under such unique circumstances will need to be reviewed in order to ensure that they continue to achieve their stated objectives, remain appropriate, and that there are not any alternatives that could better enhance well-being. The forthcoming OECD Best Practice Principles on Reviewing the Regulatory Stock provide policymakers with the necessary framework to ensure that regulations remain in the public interest over time.

Read more about the OECD Regulatory Policy Division’s work on Measuring Regulatory Performance at: https://www.oecd.org/gov/regulatory-policy/measuring-regulatory-performance.htm 

* The OECD 11th annual Measuring Regulatory Performance Conference took place in Oslo, Norway, 13-14 June 2019. The OECD Regulatory Policy Division is grateful to the Norwegian Government Agency for Financial Management and the Norwegian Council for Better Regulation, who together jointly hosted the conference.