The NSW Government has announced its initial response to the Independent Pricing and Regulatory Tribunal's Investigation into the burden of regulation in NSW and improving regulatory efficiency. A copy of the response is attached, and the Tribunal's final report is available on its website at www.ipart.nsw.gov.au.

The Government's response broadly supports the Tribunal's proposals in relation to improving the regulation making process, and undertakes to develop a detailed package of reforms over the coming months.

The Government has agreed to take immediate action in the following areas as a consequence of the Tribunal's report:

Strengthening the role of the Minister responsible for regulatory reform

The role of the Minister Assisting the Treasurer for Business and Economic Regulatory Reform has been strengthened to lead the Government's efforts for better regulation making.

Effective immediately, the Minister will be charged with ensuring that red-tape is minimised, and that best practice regulation making process has been followed in the development of all new regulatory proposals. This will involve a number of actions.

First, The Cabinet Office will refer all relevant Cabinet proposals to the Minister for advice to me in relation to any regulatory burden to be imposed under the proposal, and whether the proposal demonstrates that a best practice regulatory process has been followed. This includes matters that require both legislative as well as regulatory change. The Minister's advice will form part of the advices available to all Ministers to consider in Cabinet. It will ensure that regulatory matters are given a renewed emphasis as one of the issues that the Cabinet takes into account when considering policy proposals.

Second, a new guide to best practice regulation will be developed as part of the more detailed reform package to be prepared over the coming months. In the interim, the principles established in the NSW Government publication From Red Tape to Results – Government Regulation: A Guide to Best Practice will continue to provide the basis for assessment of a best practice regulatory process.

I remind you that the central principles set out in From Red Tape to Results are:

• reducing the cost of regulation for business, while maintaining appropriate levels of community protection
• clarity of objectives;
• analysis of the costs and benefits of new proposals;
• demonstration that alternatives to regulation have been considered; and
• more attention to regulatory design, with a presumption against 'command and control' forms of regulation in favour of commercial incentives, where these are feasible and effective.

Further advice will be provided to all Ministers and agencies when the revised guide is approved.

Third, I also request that each Regulatory Impact Statement (RIS) prepared in accordance with the Subordinate Legislation Act 1989 ('the Act') be provided to the Minister when it is finalised. The Minister will then provide advice to the originating Minister and to me regarding whether the proposal demonstrates that a best practice regulatory process has been followed.

When developing proposals that may impose compliance costs or other burdens on business or the community, Ministers may wish to consider factoring in early liaison with the Minister in this regard.

These changes represent a significant enhancement to regulatory gatekeeping processes.

Minimum consultation period

Where consultation must be undertaken on a new regulatory proposal in accordance with the Act, a minimum 28 day consultation period will now apply. The Government has agreed that this extension of time should be effective immediately. Any exemptions from the requirement to prepare or consult on a Regulatory Impact Statement provided for under the Act will continue to apply.

Where public consultation is to be undertaken on other regulatory proposals, consideration should also be given to providing at least 28 days for consultation.

Please ensure that these matters are brought to the attention of all relevant officers in your administration.

Morris Iemma MP
Premier

To access the NSW Government's initial response to the Independent Pricing and Regulatory Tribunal's Investigation, look in our publications section under Business and Government.

This memoranda has not superseded any other memoranda