‘How to avoid a royal commission’ and other useful tips for policymakers and regulators

By Melissa Coade

February 18, 2022

Meghan Quinn
Meghan Quinn, Treasury’s deputy secretary for the markets group. (The Mandarin)

According to one group of experienced public servants, the concept of ‘best practice regulation’ is a journey, not a destination. Here are some things people in the APS can do to ensure their regulatory design, delivery and administration are top-notch.

Lawmakers are expected to introduce laws and regulations that will improve the order of society, licensing and protection schemes that organise the community. But when things go very wrong, often aired in the forum of a lengthy royal commission and sometimes with evidence revealing shocking facts, the question is rightly asked: how did the government let it get to this?

A group of three current and former public servants tried to answer this question as part of a panel talk in Canberra on Thursday, acknowledging that while it was impossible for policymakers and regulators to pre-empt everything that could go wrong from the outset, committing to a regulatory stewardship approach would help. 

Meghan Quinn, Treasury’s deputy secretary for the markets group, said her department was responsible for one-quarter of the stock of regulation at the commonwealth level. She advised public servants to think about regulatory reform not only in terms of the efficacy of its flow but also in the context of stock. 

Quinn said this would help focus practitioners’ understanding of the cumulative effect of compliance burden on business and the regulated community. Because of its complexity, she also cautioned that understanding what the system effects of regulation were in a comprehensive way required ambition. 

“You need to understand the system of regulation and how it fits together, not just the marginal addition, but how it fits in in the underlying stock,” Quinn said.

“That can be really difficult to do from a practitioner’s perspective, because it’s a very complex system of regulation we have in a modern economy, and it takes time and effort and engagement with lots of parts.”

Business Council of Australia CEO Jennifer Westacott, who has held a number of senior leadership positions in the NSW and Victorian public services, said that as public servants took the first steps of designing and introducing new regulations, more scenario work at this stage was desirable. She encouraged people to think like defence personnel, who were used to ‘wargaming’ scenarios.

“You can’t know everything, but what I think often could be done is a bit more scenario work,” Westacott said.

“Let’s ask a few structured questions: First of all, ‘Have we swept too many people into this?’ Which is often, I think, not thought through. It’s often something that’s meant to be quite targeted, but actually ends up sweeping a whole lot of aspects of the economy that weren’t the problem. 

“Work with people [to ask] ‘How would that actually work?’, and think through ‘How does that look from a business’s point of view? What behaviour change will actually occur?’ and [really] hear the points about unintended consequences around complexity, cost, risk [and] confusion,” she said. 

Westacott added that investing more time in design-thinking, testing and dialogue would result in a piece of regulation that was more likely to solve problems rather than create burdens. 

“[That’s because it has actually] been put through a bit of an acid test before what is then put into parliament. What I think often happens is that amendments are moved on the floor of the Senate or the House of Representatives and, if people have done that scenario work, it would have been clear where the danger areas are,” she said. 

The panel was part of the 2022 regulatory reform conference hosted by IPAA ACT and the Department of Prime Minister and Cabinet from 16-17 February.


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