Sunday, 11 November 2007

The regulatory state is very much with us

Mick Moran developed the concept of the regulatory state as an ideal type to explain how the 'command' or Keynesian welfare state had been displaced by a state in which regulation was a predominant form of government activity. The regulatory state is very much part of the depoliticisation debate. Some writers have suggested that it allows government more effective indirect mechanisms of control while shifting the blame for failures elsewhere.

It is interesting to see how much the term 'regulation' featured in the Queen's Speech. There were proposals for 'stronger health and social care regulation'. The regulation of human embryology is to be reformed, as is party finance and structure.

Away from the speech itself, plans were announced for a new government agency to oversee the use of biofuels in the UK, in an attempt by ministers to dampen criticism of the government's renewable fuels strategy. The Renewable Fuels Agency will seek to ensure that biofuels are not imported from areas where they contribute to rising greenhouse gas emissions by supplanting areas of natural forest.

Against the background of all this activity, it was interesting to see that the Queen's Speech also promised 'a measure to reduce regulatory burdens on business.' In practice the greatest regulatory impact, particularly in small businesses, is in the areas of human resources and health and safety legislation. However, much of the regulatory burden in these areas is driven by the EU so it is difficult to see how it can be readily reduced by domestic legislation.

Under the Blair Government (although initiated by Gordon Brown's Treasury) the Hampton Review sought to tackle complaints about regulation by merging smaller agencies. In some cases, however, this rather mechanistic policy may have rather perverse effects, as is evident in relation to the debate about the future of one regulatory agency I am involved in.

In the Blair-Brown transition, there was some evidence of more sophisticated thinking in the Brown camp about looking at some of the economic and social costs of regulation which is often driven by media demands that government 'do something' about a particular problem. But so far it has borne little fruit.

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