Introduction
1. This document sets out the regulatory impact analysis (RIA) requirements, which were updated by Cabinet in 2006 (see CAB Min 40/4C, POL Min (06) 9/13 and CAB Min (06) 17/8). It expands on and further explains Cabinet Office Circular CO (07) 3 [link to DPMC website]. The key requirements relate to:
- discussion documents;
- the RIA analysis undertaken in policy development; and
- the production of a regulatory impact statement (RIS) for submission with the Cabinet paper when policy decisions are sought from Cabinet.
2. These guidelines replace A Guide to Preparing Regulatory Impact Statements, which set out the requirements that applied up to the end of March 2007. The previous regime was entitled the Regulatory Impact Statement regime, which reflected the fact that the regime revolved around the RIS document. The new regime focuses on the RIA analysis undertaken in policy development, though there is still a RIS requirement. The main changes to the requirements are:
- discussion documents must include questions/discussion of the substantive RIA elements (problem, options, impacts of options) or a draft RIS
- the RIA analysis undertaken in policy development needs to meet certain adequacy criteria
- the Regulatory Impact Analysis Unit will only have involvement in proposals that are "likely to have a significant impact on economic growth"
- the RIS is now more of a summary document.
Context
3. What is the purpose of the RIA requirements? The RIA requirements are designed to improve the quality of regulatory interventions by:
- creating requirements and incentives for departments to undertake robust policy development;
- ensuring that Ministers have the right information in front of them when making decisions; and
- providing for systems that enhance confidence in the government's internal processes.
4. What is regulation? Regulation is any law or other government rule that influences or controls the way people and businesses behave. To find out which proposals the RIA requirements apply to, see paragraph 13.
5. What is RIA? RIA stands for regulatory impact analysis. It means the analysis of impacts1 of regulatory proposals (regulatory proposals are ones that result in changes to the law or other government rules, as compared to funding proposals, reprioritising government resources, or administrative changes). In the international context, RIA has taken on a wider meaning, and refers to all of the elements of policy development - problem definition, setting objectives, considering options.
6. How do the RIA principles apply to policy development? The RIA principles of defining the problem, setting objectives, considering the full range of feasible options, and so on, should be applied from the beginning of the policy development process. When planning a policy project, the focus should be on establishing the answers to these questions. A useful way of recording information gathered and conclusions reached in a policy project is to use a running draft RIS, in which information is added during the process. This provides one document in which all of the key information is contained, makes it easier to assess the RIA analysis at the end of the process, and reduces the time it will take to write the RIS.
7. What are the main RIA requirements? The requirements are divided into four main areas:
- requirements to ensure that adequate analysis is done in policy development;
- requirements for discussion documents;
- the RIS requirement; and
- requirements for the Regulatory Impact Analysis section of the Cabinet paper.
8. What is the Regulatory Impact Analysis Unit? The Regulatory Impact Analysis Unit (RIAU) sits within the Ministry of Economic Development and will have involvement in relation to the RIA requirements for proposals that are likely to have a significant impact on economic growth. It will:
- comment on discussion documents to advise on whether they are likely to result in an adequate final RIS;
- comment on the RIA analysis to determine whether it is adequate; and
- comment on the RIS to determine whether it is adequate.
9. Code of Good Regulatory Practice. The Code (endorsed by Cabinet in 1997) sets the framework within which the RIA requirements sit. It sets out principles of quality regulation under the headings of efficiency, effectiveness, transparency, clarity, and equity.
Audience
10. All staff who are involved in policy development work should be familiar with the RIA requirements, as they are likely to have to comply with the requirements.
Review of These Guidelines
11. Where required, the RIAU will, in consultation with departments, update these guidelines.
Commencement
12. The requirements in these guidelines apply from 2 April 2007.
Contact the RIAU
Richard Hawke
Manager, Regulatory Policy
04-460 1381
Elizabeth McDonald
Team Leader, RIAU
04-470 2311
ria@med.govt.nz
Back to Top