Call to curb “regulatory juggernaut”

20 June 2006

Chartered Accountants back call to curb “regulatory juggernaut”

The New Zealand Institute of Chartered Accountants today backed the Business Roundtable’s call for a law to slow the government’s “regulatory juggernaut”.

“If the government is serious about ensuring its regulations serve the interests of all New Zealanders, including businesses, it needs to look at the way it makes regulations in the first place,” said David Pickens, the Institute’s Director of Government Relations and Strategic Projects.

“The promised review into the quality of regulation is fine as far as it goes,” Mr Pickens said, “but there also has to be an examination of the policy process itself with the aim of making it transparent, accountable and consultative.

“If the regulation-making process itself is not changed, the most that will come out of the review will be short-term palliative changes, quickly swamped by poor quality legislation from the government's regulation-making apparatus," he said.

“Then in another couple of years we’ll need another regulatory review.”

The Institute has proposed a Regulatory Responsibility Act to expose regulation making to greater public scrutiny. This legislation would be backed by an independent body that would review and comment on the government’s regulatory performance.

The Business Roundtable has also called for a “constitutional-type regulatory responsibility act”.

In 2005 the Institute approached all political parties, and a range of business and non-business groupings, for their views on a regulation reform package, including a Regulatory Responsibility Act. The feedback showed considerable support for the legislation.

The Institute also backed Commerce Minister Lianne Dalziel’s suggestion that Australia’s Productivity Commission be turned into a trans-Tasman institution. The commission is the Australian Government's principal review and advisory body on microeconomic policy and regulation.

Mr Pickens said that without urgent action to stem the flow of “unnecessary and overly burdensome regulation, New Zealand risks losing an important advantage it has held for many years over its trading partners - the absence of excessive red tape”.

The danger was highlighted, he said by the IMD World Competitiveness Yearbook in which New Zealand’s international competitiveness had fallen from 16th to 22nd of 61 economies measured.

“It is important that bold steps be taken to arrest the decline in New Zealand’s competitiveness against other countries.”

The New Zealand Institute of Chartered Accountants is this country’s largest professional body, with over 28,000 members.

ENDS

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