Government & Regulation National University of Ireland, Maynooth 4 February 2004

1. Government & RegulationNational University of Ireland, Maynooth 4 February 2004 Brendan Tuohy Department of Communications, Marine & Natural Resources www.dcmnr.gov.ie

2. Department’s Programmes • Communications • Telecommunications • Postal • eCommerce • Broadcasting • International (ICT4D) • Marine • Maritime transport, safety & rescue, ports, coastal zone management, fisheries harbours • Fishing – off-shore and inland • Marine leisure and research • Aquaculture

3. Department’s programmes • Energy • Electricity, gas, oil, peat • Renewable and sustainable energy • Off-shore petroleum exploration • Mining & exploration

4. Bodies under the Minister • Bord na Móna • Irish National Petroleum Corporation • National Oil Reserves Agency • Electricity Supply Board • Eirgrid • Sustainable Energy Ireland • Bord Gáis Eireann • An Post • RTE

5. Bodies under the Minister • Bord Iascaigh Mhara • Marine Institute • Central Fisheries Board • Regional Fisheries Boards

6. Bodies under the Minister • Comreg • Commission for Electricity Regulation • Broadcasting Commission of Ireland • Broadcasting Complaints Commission • Aquaculture Licensing Appeals Board • Telecoms Appeals Board

7. Presentation • Changing roles of government • Competition and regulation • Sectoral changes and experiences of regulation & liberalisation • Independent regulation • Regulating Better (2004) • Public policy on regulatory reform • Concluding comments

8. Changing roles of Government • Initial role • Shareholder • Regulator • Sectoral policy • New role • Regulatory policy • Sectoral policy • Independent regulation

9. Evolution of competition and regulation • Role of competition in contributing to the development of efficient, productive economies with capacity to sustain growth in long term • Competition may also require regulation • Command and control or incentive-based? • Changes in the transport, energy, communications & broadcasting sectors

10. Sectoral changes • Independent Regulation • Aviation • Telecommunications, postal, broadcasting • Energy: electricity and gas • Public transport • Sea fishing boats • Ports * • Changes in ownership or structure • Alliances, privatisation, commercial State companies

11. Experiences of competition • Better quality & range of services for customers • Greater productivity • Greater private investment in infrastructure • Increased competitiveness • Increased economic efficiency

12. Experiences of liberalisation • Critical networks in an economy • Island status • Limitations of markets & State intervention • Shareholder perspective by private sector and unions (e.g timeframe for return, reinvestment in network, attitude to competitors, use of legal mechanisms) • Opening up infrastructure to others • Competition in services vs. infrastructure

13. Independent regulation • Governance mechanisms • the set of systems, structures and processes by which regulation takes place • Transfer of power from the political process • Need for clear and defined accountability mechanisms • Accountability • How regulators operate • How they explain, answer for and bear the consequences of the way in which they discharge duties, fulfil functions & utilise resources

14. Governance & accountability • Public discussion by MPE – Sept. 1999 • Policy Proposals: Governance & Accountability in the Regulatory Process (March 2000) • Achieving the balance between independence and accountability • Rectifying the perceived democratic deficit in relation to transparency and means of redress • How regulatory structures should reflect the regulatory needs of the relevant sector

15. Governance & accountability in the regulatory process • Updating of legislation (e.g fines, penalties) • Establishment of regulatory commission • How concerns of particular groups (e.g disadvantaged) will be handled • Minister to specify public service requirements • Appointment of regulators

16. Regulatory bodies • Need for confidence in the regulatory bodies • Independence • Competence • Integrity • Accountability • How they carry out their functions • How they make decisions • How they report on their activities

17. Minister’s proposals • Clear-cut procedures in the interests of certainty, transparency and accountability • Codes of decision making procedures • Freedom of Information Act to apply • Financial reporting • Strategy Statements • Annual work programmes • Reporting to the Oireachtas

18. Regulating Better (2004) Principles • Necessity • Effectiveness • Proportionality • Transparency • Accountability • Consistency

19. Regulating Better (2004) Overview of actions • Evidence-based policy making • Regulatory Impact Analysis • Systematic reviews • Statute law revision • Appeals systems • Burden of compliance on business • Guides, consultation, sectoral regulators

20. Issues of overlap • Feature of modern Government • Need for clarity and certainty • Policy level • Statutory provision of a clear & transparent framework for the strategic division of regulatory responsibility • Operational level • Set of administrative procedures to ensure smooth execution of functions by the organisations

21. Public Policy on Regulatory Reform • Minister is responsible for regulatory policy incl. policy directions • Role of Department • to promote the provision, development and regulation of competitive, safe, secure, effective and high quality services for customers in the transport, energy and communications sectors

22. Public Policy on Regulatory Reform • Set out clearly the principles & policy parameters within which regulators are to operate • Requires on-going evaluation including the extent to which economic regulation is required; the balance between costs & benefits of regulation; technological developments; globalisation; the needs of the economy etc.

23. New Zealand experience • Relied on general competition law and voluntary self-management • In telecoms, it has not been fully effective • “The inquiry favours industry self-management and a regulatory under-pinning”

24. OECD Review of Regulatory Reform • General regulatory principles • Specific issues relating to the ‘public enterprise’ sector • OECD view of benefits of regulatory reform • Can lead to increased efficiency and non-inflationary growth • Enhances flexibility and helps deal with shocks, • Improved citizen protection through efficient regulation

25. Conclusion • Effective Regulation is an important determinant of national competitiveness • Independent regulation raises important issues not just for the economy but for democracy • There are serious limitations to liberalising markets particularly in relation to networks in small, island economies • Governments will continue to have an important role even in liberalised markets

26. Contact • www.dcmnr.ie • Brendan.Tuohy@dcmnr.ie