Dáil Éireann díospóireacht -
Tuesday, 20 May 2003

Vol. 567 No. 1

Ceisteanna – Questions (Resumed).

Mr. Sargent

I echo the Ceann Comhairle's welcome to our visitors.

Can the Taoiseach say what progress has been made towards publication of the White Paper on regulation in 2003, and the introduction of the regulatory impact analysis which he told us about in February, given the importance of impact analysis for regulatory activity? Would he accept, for example, that because the inflation rate is twice the eurozone average and personal debt stands at €56 billion, according to the economist Dan White, many people are concerned that in many cases regulation tends to be followed by rationalisation and layoffs? Would he for that reason consider it a priority to move on impact analysis before proceeding with deregulation in any other area?

Would he take note of the International Institute for Management Development report which shows that Ireland is no longer among the top ten most competitive smaller economies? Would he accept that Ireland has never been competitive when it came to sustainability and encouraging enterprise based on long-term sustainability? Renewable energy is a topic that we have discussed many times. It is an acid test of future competitiveness. Would the Taoiseach agree that unless sustainable activities are competitive that competitiveness is a short-term thing about which to boast?

Would the Taoiseach accept that there are certain natural monopolies which it may be counterproductive to deregulate? For example, An Post was in conflict recently with the regulator for trying to locate letter boxes at the roadside rather than in people's houses in rural areas. Would he agree that to maintain levels of service in the community and quality of life, there are certain enterprises that have a natural monopoly? Will that be taken into account?

The Taoiseach

The Deputy asked two questions. On the second question, about competitiveness, if one wants to achieve anything on that agenda it must be based on trying to improve and sustain the situation. There is little point in doing it, boasting about it or criticising it on the basis of any analysis other than its usefulness to the economy in terms of creating jobs, wealth and regenerating resources into services.

Mr. Sargent

What about the environment?

The Taoiseach

That includes the environment. With regard to natural monopolies, there are areas where it does not make sense to break these up because turning a public sector monopoly into a private sector monopoly does not achieve much. Breaking a public service monopoly into a number of parts does not necessarily make it more efficient. The issue of the post boxes is being dealt with but I do not want to encroach on the area of the Minister for Communications, Marine and Natural Resources. We should not just take the view that deregulation is a good idea in every area. Neither the OECD nor the EU say that we should deregulate for that reason.

As regards the Deputy's first question, concerning the high-level group which is taking on the next phase of the OECD report, I will cover some of this ground again as I have dealt with it regarding Deputy Rabbitte's question. The group examined those findings. The national statement of Government policy on better regulation, which will be published shortly, will have as its ultimate objective to seek to identify the core principles that make up regulatory impact analysis and to inform future decision making. As regards the need for regulation in the future, or changes to existing regulations, it has made many other proposals that I have not discussed today about composite legislation, condensing legislation and the means of updating legislation. They are set out in the Statute Law (Restatement) Act 2002 which continually updates and consolidates legislation.

The high-level group was asked to consider this issue and it recommended that the first step in the preparation of the policy should be a consultation process. That process and the economic analysis are done and published. Without reciting the issues and going over the same ground, a few examples under some of the main headings might give the House an idea of some of the questions raised in the consultation document. These are likely to be further developed in the context of the paper that is to be issued. There are three sections and I propose to outline some of the headings therein: the performance of the economy and consumer welfare; how to ensure that consumers' rights and interests are protected and promoted; how regulatory reform might contribute to national competitiveness and strengthen the operation of competition policy in the country; and, whether the regulatory system is supporting infrastructural developments and what improvements might be made in that regard. The group will argue over and come to recommendations on those headings.

Regarding efficiencies in the public sector, regulatory impact assessment, on which I have already given details, will examine proposed new regulations in keeping with a results-orientated approach to management of the public services. As I have already explained, there will be ongoing systematic review and simplification of existing regulations. There will be new legislative procedures to consolidate, restate and enhance the accessibility of existing legislation. Rather than having out-of-date legislation or always having to go back over five or six Bills, we will use the Statute Law (Restatement) Act 2002 to update legislation continually.

The third section on which the group will report is the quality of governance, including what forms of institution are appropriate to governing newly liberalised sectors and what regulatory reforms are needed in such contexts, a question that Deputy Rabbitte raised regarding controlling regulators and what rules should apply to them. It will also assess whether there is a need for legislation on administrative procedures in the Irish context and how the use of alternatives to regulation can be more widely considered.

Mr. J. Bruton

I have two specific questions about the OECD's findings in its report.

The first concerns the strategic management initiative. The report stated that reliance on the SMI approach based on self-assessment and peer pressure may provide too few incentives to transform regulatory traditions and practices. It went on to state that the unit in the Department of the Taoiseach was too small to achieve any results and that its smallness revealed what the OECD described as a lack of political commitment to SMI, presumably on the part of the Taoiseach himself. Has that changed?

Does the Taoiseach agree with a second statement made by the OECD, to the effect that, compared with the pace of change in the Executive regarding deregulation, the Dáil has been slow to assume its new regulatory accountability role? It goes on to state that adequate resources have not been accompanied—

An Ceann Comhairle

Is the Deputy quoting the report?

Mr. J. Bruton

I can quote it from memory. Adequate resources have not been provided for the Oireachtas to enable it to fulfil what is required of it to ensure that regulatory reform means something. Does the Taoiseach not agree that there is a tremendous risk in this area of creating more paperwork, allegedly to eliminate it, and that there is an endless capacity to set up committees and procedures, supposedly to relieve burdens, but in fact increasing them because of their sheer size and number?

The Taoiseach

To answer Deputy Bruton's first question, following that suggestion, we took all those involved in the strategic management initiative and related areas in the Department, with which Deputy Bruton is familiar, and put them all together. We did not simply create a new unit for regulatory impact analysis. To maximise the usefulness of my staff, I brought the entire SMI section and all the related parts together to achieve a more efficient operation. The section is still not enormous, but, as the Deputy knows, there is a fair number of people.

Mr. J. Bruton

Does the Taoiseach not agree that there are no rewards for civil servants who perform well and no sanctions for those who perform badly?

The Taoiseach

Deputy Bruton and all Members of the House know the system in place for civil servants and it is not true to say that they are not rewarded. It is increasingly the case that civil servants of what would have been considered extremely young ages a decade ago now progress to the top positions of Secretary General and Assistant Secretary General, and do so on ability. Promotion is not as it was, namely, based on age grounds. That younger people can get up the ranks is a benefit. That is what I did to get the best value out of my staff and to bring the sections together.

I agree with Deputy Bruton that we should not set up sections or systems to create more paperwork or more cumbersome issues. That is precisely what the OECD report was about. We should consider all that we do in regard to legislation, regulation and otherwise to find where the system could be simplified or made more sensitive or to find where we should not have it, and to try to keep under very set criteria issues for which we must develop a model, as I said earlier, under the ten areas I outlined earlier.

Regulatory impact analysis and the OECD report are about trying to act more efficiently. It is not an exercise in bureaucracy but the opposite; it is intended to simplify a system which can be extremely bureaucratic, and I hope this system is not going in that direction.

Mr. J. Bruton

What about the Oireachtas?

The Taoiseach

Substantial resources have been put into the Oireachtas in recent years. It was highlighted in the report that we do not, as we should, have a committee on competitiveness. I have already engaged with the party leaders and the Whips in regard to that. It was stated in the OECD report and in Sustaining Progress that we should have a committee geared to competitiveness in the House and I accept that we have not addressed that.

Caoimhghín Ó Caoláin

Given the dominance of PD thinking within Government in regard to public enterprise, can our citizenry have any confidence that the subtitle of the White Paper when published will be other than a charter for privatisation? When does the Taoiseach expect the White Paper to be published? Can he give us a firm indication that this will happen, if not in this session, in the following session?

The Taoiseach

I hope it will be during this summer. I do not think it will be before the upcoming break but the section is working to have it completed before the holiday break at the end of July. I checked this matter this morning and was told that the July deadline will be met. Based on the latest information, which is all I can give the House, I hope it will be before the summer recess.

I accept the concern that people will think that regulation is another device to move towards privatisation of State utilities because that arises in the OECD paper in regard to a number of issues. However, on this particular issue, it is pointed out that it is seeking to try to simplify regulation and to set a mechanism so that we do not have detailed regulations which are unworkable or cannot function. It is not a device for getting recommendations or a determination to privatise State utilities. While that arises in regard to other aspects of competition, it is not what this working group is endeavouring to do.