REGULATING RULEMAKING VIA IMPACT ASSESSMENT

1. REGULATING RULEMAKING VIA IMPACT ASSESSMENT Claudio M. Radaelli Professor of political science and Jean Monnet chair Director, Centre for European Governance University of Exeter, UK Seminar presentation at Bocconi University, Milan, 18 March 2010

2. Part 1 – Aims and theory

3. Aims

4. What is RIA? Economic analysis of proposal New legislative techniques Consultation Regulatory oversight

5. Why this topic? Delegation is typically accompanied by the obligation to perform RIA It sheds new light on control mechanisms: neither ex-ante or ex-post but on-going control Cornerstone of new regulatory reform programs It affects the pre-legislative stage of scrutiny of bills and regulation It has implications for cabinet decision-making

6. Project and paper • Project background: paradox of ‘smart and better regulation’ producing more regulation • Focus on political consequences of adopting and implementing regulatory impact assessment (RIA) • Fieldwork in six countries and the EU, with 72 face-to-face interviews based on a questionnaire with closed items, scales, but also open questions (2006-2008) • Methods: process-tracing, comparative policy analysis, probit models, reflexive dairies • Cases: Den, Sweden, UK, NL, USA, Canada, and the EU

7. Gaps in the literature • Not clear on the concepts – “better regulation” “RIA as fire alarm” • Theory has been tested only on the US and the UK • Snapshot analyses and scorecards of RIA • Handful of case studies (US, EU) • Hahn, Tetlock etc. have produced data on the economic consequences of RIA, political consequences are less explored

8. Research questions in the project RQ 1 – Theoretical rationales for RIA adoption? RQ 2- What are the political control properties of RIA? Does evidence point to political control usages of RIA across the cases? RQ 3 - Since there are different theoretical justifications which one prevail across the cases? RQ 4 - Why do most European countries adopt and only some implement RIA?

9. Briefly on RQ1 Alternative theoretical justifications, specifically instrumental learning (Jnl European Public Policy 2009), public management reform (West European Politics 2010Public Administration 2009) and symbolic politics (Scandinavian Political Studies 2010 and Evaluation 2009) However, the justification that has been developed in greater detail is political control (McNollGast, Balla, Moe)

10. The puzzle of the principal 1 to make sure that a different political majority in the future will not change the direction of regulatory policy: 2 to limit agency drift without knowing what type of individual rules will, case by case, inflict costs or create benefits for the constituency supporting the incumbent; 3 to act timely, that is, to exercise control when it is not too late.

11. The politics of structure (Moe) RIA as meta-policy instrument – it does not deal with substance Stacking the deck with requirements like CBA No need to police and patrol the agent – RIA as fire-alarm Process-oriented tool

12. “No RIA, no Party!” – so the theory goes

13. Part 2 – Research design

14. What the paper does – what the paper doesn’t do…. Check propositions elaborated with the US in mind by looking at evidence from seven jurisdictions Note: to test a theory that has clear observable implications is not to endorse it The paper explores whether RIA is a control device. It does not say whether political control is more important than learning, rationality, symbolic politics - this is the topic of the Scandinavian Political Studies paper

15. Research design Dependent variable: political control gained via RIA (from zero to significant, ordinal measures) Independent variables: control power of the core executive (Presidential systems, Westminster systems, coalitional politics,…), administrative capacity for oversight, administrative styles (formal vs. informal; negotiated orders vs. hierarchy) The methods are qualitative (process-tracing, interviews) with some indicators, later elaborated in the Scandinavian Political Studies article and in an econometric paper under review.

16. Part 3 Findings

17. USA Governance architecture: APA and executive orders on regulatory oversight Unitary executive and the institutional architecture for oversight Political incentives and resources of the OIRA-OMB push towards political control Institutionalisation of RIA beyond partisan matters Different ways to use ‘control’ (Clinton experience, prompt letters of OMB-OIRA)

18. Canada Federalism, administrative styles and low administrative capacity at the centre Transparency prevails on other factors. More carrots than sticks Central unit in charge of RIA quality does not challenge much Recent innovations may increase the resources for political control (triage)

19. UK Executive government: cabinet office and Ministerial panels. Recently Regulatory Policy Committee Administrative styles: Innovations are pushed down Administrative capacity at the Better Regulation Executive is high

20. European Union The structure of executive power in the European Commission (mixed-power polity) The question of administrative capacity at the centre of the Commission The administrative styles in transition Control has different empirical manifestations in this case

21. NL Negotiated orders more than clear lines of authority between Ministers and civil service (administrative style) Key position of Ministry of Finance in regulatory reform, but until recently RIA managed by the Ministry of Economic Affair (with low administrative capacity) Increased overall control of the core executive via better regulation tools, but not via RIA Recent reform of RIA goes in the direction of control

22. Sweden and Denmark • Structure of the executive very peculiar in Sweden, minority governments in Denmark: no-one can call the shots for regulatory reform • Better regulation movement in consensual democracies • Peculiar role of Swedish committees of inquiry • Administrative style • Tradition of limited direct political intervention on regulators from the core executive • RIA system is sloppy in Sweden, so it cannot achieve much in any case. Reform of RIA in 2008 may increase control though • Denmark: de-coupling effects

23. Part 4 – So what?

24. Discussion and conclusions Political control requires a certain type of executive, administrative capacity, and a particular style of interaction between politicians and regulators. The architecture within which RIA is lodged is important The control theory is corroborated by UK and US cases. EU has high level of control but this does not mean that there is a single strong overseer – control comes from different sources In other cases the hypothesis of political control is found wanting Problem of counterfactual (Coglianese, 2002)

25. Normative implications Elected politicians draw on RIA to exercise political control: is this good news for regulatory accountability? Should political control be more or less important than other goals, such as reflexive social governance or the efficiency of regulations?

26. What next?

27. What next? Paper is part of a project that generated 18 articles and chapters, including two papers for the World Bank + website + final conference at British Academy (80 participants) Course for public managers, taught in Washington at the World Bank Global core course on effective regulatory reform) and The Hague (EALL) Next step: European Research Council project on types of learning (ALREG)

28. Thanks... Any question?