Trend to removing restrictive regulations firmly established

On Tuesday, the Organisation for Economic Co-operation and Development came to town with a report on Regulatory Reform in Ireland…

On Tuesday, the Organisation for Economic Co-operation and Development came to town with a report on Regulatory Reform in Ireland. Although the title suggests a rather painful read, and the chapter headings (i.e. "The macroeconomic context for regulatory reform" or "Government capacity to assure high-quality regulation") are hardly earth-shattering stuff, the report provoked rather excited headlines and stories during the week.

Regulatory reform, like bench marking, social inclusion or enlargement, is a phrase which instantly sedates the imagination. Why draftsmen, consultants and Governments continue to infest their messages with hives of these phrasal tsetse flies, ready to numb the mind and send us all to sleep, I will never know.

Like benchmarking, social inclusion and EU enlargement, when you delve into the real meaning of the phrase, regulatory reform is certainly a worthwhile aspiration.

Many aspects of our lives are affected by State regulations. Economic regulations affect pricing, competition, and consumer interests. Social regulations protect the public interest in the areas of health, food safety and the environment. Administrative regulations control government schemes and the gathering of information.

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In the vast majority of cases, these regulations benefit society. As the Taoiseach pointed out on Monday, however, if State regulation is excessive in quantity, or is of poor quality, it will be an unnecessary burden on economic and social activity. In such cases we have to reform these regulations.

To that end the OECD's report is thought-provoking and welcome. In compiling its report it has carried out an indepth assessment of our Government institutions, competition policy, electricity, gas, legal services, pharmacies, licensing laws and more. It questions many of our present structures and regulations.

It is always refreshing to get an outside view of our state of affairs and to receive the advice of undoubted experts. Indeed, much of what they say seems to make sense. Regulatory reform, stretching back as far as the Whitaker Report, has helped build our economy and society.

The OECD argument is that Ireland, following our remarkable economic performance for the last decade, and having closed the longstanding income gap with the rest of Europe, now needs to reform many of our State regulations to sustain this economic performance. It also argues we should reform State regulations to modernise the public service and reduce red tape. We will not be reforming regulations for the sake of reform, however.

THE Taoiseach stated firmly during his speech on Monday that it is his belief we should take a pragmatic approach to regulatory reform and not from an ideological viewpoint of deregulation for its own sake.

Indeed the comments of Ken Murphy, the director general of the Law Society, that "the OECD wants to encourage competition but countries cannot be run on competition policy", are also worth bearing in mind.

In other areas, however, it is difficult to disagree with the report. Its arguments for the abolition of restrictions on pub and pharmacy numbers will be convincing to the vast majority of the populace. When we consider that the abolition of limitations on the numbers of pub licences would also cut the price of alcohol and probably have a negative impact on inflation, the arguments become even more compelling.

In the legal sphere the OECD has recommended that the control of education and entry into the legal professions be removed from self-governing bodies such as the Law Society and the Bar Council.

Certainly this should be examined, as there is a perception the professional bodies may be limiting entry to legal education courses to keep numbers down. In recent times, my experience of the Bar has been one of openness and transparency on the education front.

However, entry to the legal profession, or indeed any profession, should be open to anyone with the will, inclination and ability. The Government is already following up on the OECD's report, considering its proposals and providing a way forward. The Taoiseach is setting up a high-level group on regulation, commissioning a system of regulatory impact analysis and preparing a national policy statement on regulatory reform.

In addition, the Competition Authority will be asked to undertake studies of particular areas of the economy, particularly the professional services.

The examination of pharmacies, already under way, will be speeded up and the Commission on Liquor Licensing will be asked to provide reports on agreements reached in advance of its final report, which is not due until 2002.

These moves are all part of a trend towards public accountability. In the political sphere, for example, we are becoming more citizen-orientated. Noel Dempsey's electoral reforms are being brought forward exactly to that end. In the commercial and economic sphere we are becoming more consumer-orientated. The OECD report outlines the work to date in this area and shows just how far we have to go.

The public service modernisation programme is striving to make the reforms necessary to make the public service work more effectively for the individual citizen, cutting down on red tape and increasing accessibility. There is a definite shift in attitude abroad. Reform at last is on the agenda.