Like reality TV, cutting economic red tape is all about the 'journey'

In the modern digital age some things capture the public attention and imagination and some things do not.  Ironically, in a kind of triumph of the trivial, the things that are not really of much practical importance or real effect to people’s lives and well-being appear to have a wildly disproportionate ability to capture public attention.

Conversely, it is often the things that actually have an important effect on people’s day to day lives and their families and business that get little or no attention.  Being a bit of a fan of The Bachelor myself I understand how this happens but, as a case in point, this week 1.2 million Australian’s watched the premier of ‘I’m a Celebrity…Get Me Out of Here’ and I can guarantee only a tiny handful will have read (or even heard of) the Best Practice Regulation Report released in the same week.
The report, released by the Office of Best Practice Regulation, provides a summary of the Coalition Government’s compliance with something called a Regulatory Impact Statement or RIS.
At least in this sense it has one thing in common with reality TV; the report is all about the journey.  As any avid watcher of reality TV knows, whether you are seeking love on the Bachelor or a new career on MKR, everything is about the ‘journey’.  Reality TV reflects reality at least in the sense that it recognises how good outcomes do not arise without good processes and that is what the Coalition government has recognised in its agenda to cut the cost of red-tape for Australian business and families.
The Coalition undertook to cut $1 billion dollars’ worth of red tape out of the Australian economy every year for three years.  It is well on the way, having already effected decisions which so far will lead directly to a $2.1 billion removal of compliance costs and delay costs previously caused by unnecessary laws, rules, regulations and forms.  The RIS is the key gatekeeping process which is designed to achieve one important end; that government decision makers know, when they decide to do something which creates a regulatory burden exactly how much it will cost people and business when they do it (and conversely when they remove regulation as this Government has been doing how much they save).
Because the Coalition undertook to remove $1 billion net in regulation each year we have recognised the need to be precisely counting both the few additions, as well as the many reductions in the stock of regulation the Government has achieved.  So upon coming to Government, as well as getting straight to work on cutting out costly red tape from the economy, the Coalition also immediately strengthened the process of measuring the costs and savings of additions and reductions in the stock of regulation.  The key gatekeeping RIS process that counts the costs and saving of policy decisions was strengthened to allow for greater consultation with the business and groups that might be affected by any change.  Rules were developed that make it clear that non-regulatory options must always be considered for any issue and that the option with the highest net benefit is the one that should be pursued.

Specific Deregulation Units tasked with cutting red tape were inserted into each portfolio department and the Office of Best Practice Regulation has developed better and more precise methods of calculating the costs of regulation.  And critically, for the first time, the costs of regulation to individual Australian’s is being measured (in a very poor effort and triumph of the red tape mindset the former Labor government had no measure of the cost effect on individual Australians of any regulation they put in place).

As well as this strengthening of the process that checks the growth of regulation, the Coalition did something very important; it has actually observed the process in a substantive way.  A process designed to check the growth of regulation and incentivise the removal of unnecessary regulation is not much good if it is observed most substantially in the breach, as was the case under the previous government.  A key measure of whether the RIS system is being properly observed is how many Prime Ministerial exemptions to the process are granted.
This week’s Best Practice Regulation Report notes that in the Coalition’s first year of Government there was only one occasion where a regulatory scheme went to Cabinet and the Prime Minister exempted it from the RIS process (that was the Qantas Sale Amendment Bill).  Further, the Coalition was 100% compliant with the general RIS process in 2013/14, as the only non-compliance for the year was by the Labor Government.

By comparison, under the former Labor Government there were a total 27 exemptions granted by the various Labor Prime Minister’s over their last three years and a remarkable 14 exemptions granted in 2010-11 alone.  It is little wonder Australia suffered from the cost of growing regulation under Labor when expediency took over from good process and many big decisions with very large regulatory costs just got waived through with a Labor Prime Ministerial say so.

The Coalition has recognised both that removing billions of dollars of red tape from the economy is a key part of making the nation more productive and that having tougher processes to stop red tape growing and then actually sticking to those rules is the key to better outcomes.  Getting rid of red tape will always be less attention-grabbing and more difficult than getting celebrities out of Africa but both are all about the journey – and the Coalition’s journey to cut red tape will save Australian families and businesses billions.

Christian Porter/  The Australian/  7 February 2015