better_regulation/what-do-we-mean-by-better-reg

What do we mean by 'better regulation'?

When we think about ‘better regulation’, we ultimately think about smarter, better targeted regulations that benefit the overall society. We believe that innovative technological solutions can contribute to building a regulatory system that is simpler for businesses to navigate, but also maintains important protections for citizens and the environment.

Better regulation for whom?

While the goal is to improve outcomes for the society overall, applying innovative technological solutions to better regulation can benefit the following users:

  1. Policy makers will be able to assess the existing stock of regulations (both within and outside their policy area) before imposing any planned regulation. By gaining a better understanding of the existing stock of regulation, government policy makers can assess where regulations are conflicting or overlapping, and in turn, be in a position to create better regulation.

  2. Businesses may face large regulatory burdens that can be a barrier to growth. A better regulatory system will allow policy makers to create regulations that better understands the needs of businesses, and firms will also be able to navigate through the stock of regulations more easily to see exactly which regulations affect them and their particular sector. This will result in a lower cost of regulatory compliance for businesses.

The user base can also be extended to those imposing regulation, who also stand to benefit from a more streamlined regulatory system.

The success of implementing our technological solution to better regulation therefore lies in meeting the needs of these end users. Through arranging meetings and consultations with members of the legislative body and other potential users, we are seeking an in-depth understanding of user needs and ensuring that these are incorporated in the design of our tools for the GovTech challenge.

How are we contributing to better regulation?

As a first step towards applying innovative technologies to better regulation, we are keeping these end users in mind and are focusing the first phase of the BEIS GovTech Challenge on the following key question:

How can we analyse the stock of existing regulation and identify which requirements apply to different businesses and sectors?

At its core, legislation is about rules, and this includes putting requirements on businesses. However, these requirements are not always easy to identify. What one expert may consider a requirement, another may not. The identification of requirements requires detailed definitions and a requirement may also be described in several places within a text, which might lead to ‘partial definitions’. Another challenge arises in taking into account the different types of requirements and exactly which of these affect what type of businesses. As part of the GovTech challenge, we are consulting legislative experts and referring to various government sources to derive definitions of requirements. An interesting way to confirm the applicability of our definitions and to assess the burdens on businesses would be the use of impact assessments released by the government. We use the official government website, legislation.gov.uk, as our main source of data for this. In extracting records from the website, we have decided to contact the Editorial Team of legislation.gov.uk who will aid in our navigation and understanding of its contents.

Overall, we believe that it should be easier for businesses to know which regulations apply to them, and for policy makers to quickly ascertain the group of businesses that a regulation applies to. However, defining businesses and sectors in itself is subjective. As some legislations apply to many different sectors, it is difficult to identify a finite ‘bucket’ of legislations that apply to each sector, or to different groups of businesses. One might consider the typical approach of categorising businesses into sizes and industries. The use of SIC codes provides a solution to dividing sectors, however the level of granularity to consider is a topic of discussion. As a first step to identifying which requirements affect what businesses, we can consider the first two digits of an SIC code to allow for a more generalised division of sectors.