Hints for Writing an RIS/BCCS

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Hints and Tips for Writing a Regulatory Impact Statement / Business Compliance Cost Statement (RIS/BCCS)

Regulatory and Competition Policy Branch

[ Last Updated 13 December 2005 ]

Statement of the Nature and Magnitude of the Problem and the Need for Government Action

Clearly define the fundamental problem being addressed - don't focus only on symptoms of the problem.
Include all relevant background information, so that the problem can be seen in context. Assume the reader has no prior knowledge of the issue.
Be sure not to pre-justify the preferred option or solution.
Be sure to include some measure of the magnitude of the problem, quantified where possible.
Justify why government action is needed - e.g. market failure, regulatory failure, enforcement problems, the problem is escalating etc.

What is the government trying to achieve in relation to the underlying problem, in terms of goals and/or outcomes?
Think about the primary (over-arching) objective and secondary (more specific) objective(s).
Do not pre-justify or align with the preferred option.
Where relevant, refer to any constraints (e.g. budget, time etc.) and/or pre-existing authority for the proposal (e.g. Cabinet decision, governmental policy etc.), or any international obligations

Identify, using sub-headings, all feasible options considered during the policy development process.
Begin with the status quo (the current regulatory environment or "do-nothing" approach), as this provides the counterfactual to all other options considered. Outline the key features, and include a statement as to why it is no longer appropriate to maintain the status quo.
Next, identify any non-regulatory options that were considered. Outline the key features of each option, and include a statement as to why a non-regulatory option is not preferred.
Follow by identifying alternative regulatory options that were considered. Outline the key features of each option, and include a statement in each option as to why it is not preferred.
Conclude with the preferred option (clearly identified as such in the heading). Outline the key features, but (due to the length constraints for RISs), do not include any analysis. This is to be done in the net benefit section.

This section sets out who will be affected, how they will be affected, and to what extent (costs and benefits).
Identify the relevant benefits, costs and tradeoffs / distributional effects under headings of the various sectors impacted (e.g. government (including local government), industry, society).
Sometimes it may be necessary to break a key sector (e.g. industry) into sub-sectors to clearly indicate the different impacts (e.g. on importers, exporters, small business etc.).
You need to include in the analysis the relevant direct and indirect impacts; tangible and intangible impacts, administrative and compliance costs for business (refer to these in the RIS but the detail goes in the BCCS); opportunity costs; and international considerations where relevant.
The impacts should be quantified as far as possible.
The level of analysis should be commensurate with the likely impacts of the proposal.

Outline the form of consultation. If no consultation was undertaken, indicate why not.
Which stakeholders have been consulted? Were any significant concerns raised? How were these concerns addressed? If not, why not?
Which government departments / agencies have been consulted? Were any significant concerns raised? How were these concerns addressed? If not, why not?

Identify sources of incremental compliance costs (i.e. "red-tape" costs) of interacting with government, incidental to the obligation itself e.g. compliance costs are NOT direct charges or fees imposed as a result of the proposal, rather:
- ONE-OFF compliance costs could include for example:
  - information costs (identifying and understanding the new regulatory requirement)
  - upgrading production processes / equipment / buildings / software etc.
  - buying in of specialist services (e.g. accounting, IT, legal etc.)
  - psychic costs (stress, anxiety etc.)
- ON-GOING compliance costs could include, for example:
  - staff costs or time
  - inspection fees/ enforcement, charged at an hourly rate
  - licence application process (application form, writing letter, providing photo, running advertisements etc.)
  - form filling /administration /paperwork (compiling
  - necessary information, time taken etc.)
Identify parties likely to be affected - by sector and size of firm
Estimate compliance costs - quantify as far as possible, however, if this is not possible, provide qualitative estimates. Identify where costs fall differentially on different groups (e.g. small business, new businesses etc.) and set out any assumptions behind estimates
Outline steps taken to minimise compliance costs - e.g. lead-in/transitional arrangements, communication / education / awareness strategies, use of electronic technology, advisory services etc.

Printed: 26/11/2009