We use cookies to make your experience of our website better. Some of these are set by third party Google Analytics to help us analyse website traffic. To comply with privacy regulations, we require your consent to set these cookies. If you continue to use the site without selecting an option we will assume you are happy for us to use cookies.

There’s No “I” In “Regulator”: The Scottish Regulators’ Strategic Code Of Practice

There’s No “I” In “Regulator”: The Scottish Regulators’ Strategic Code Of Practice

Adam McCabe

The Scottish Government’s consultation on a draft Code of Practice for Scottish Regulators closes on 28 April 2014. 

A Working Group of business and regulatory representatives has prepared a “strategic code” document which is to referee how eleven specified Scottish regulators deal with those they regulate, with other interested parties and with the environment. 
The Code details how regulators can adapt their practices to contribute to achieving sustainable economic growth. There will be a legal duty on the eleven regulators to “have regard to” the Strategic Code of Practice in their decision making, standard setting and policy development. 
Amongst that line-up of eleven are the Scottish Fire and Rescue Service, environmental body SEPA, charities regulator OSCR, the Food Standards Agency and the Accountant in Bankruptcy, as well as all Scottish local authorities (excluding planning authorities). The UK Health and Safety Executive (HSE) is not included and will continue to have its own enforcement policy.
The Code sets out the responsibilities and recommended approaches of Scottish regulators as “enablers”, able to reduce bureaucratic inefficiency and encourage ethical business behaviour while still delivering their core supervisory functions and contributing to growing the economy without damaging the environment.
Naturally, the Code makes reference to the “better regulation” principles of transparency, accountability, consistency and proportionality. Mechanisms are to be put in place by regulators to minimise compliance cost where possible, to open up communication channels – including with each other – and to be alive to other interests when lining up their regulatory crosshairs, such as relevant interests of the local community. Formal impact assessments, for example, are not obligatory across all regulators at present but are highlighted by the Code as good practice when a regulator is considering implementing or changing a procedure.
A key premise of the Code is that good regulators seek to understand those they regulate. Where there is an open and effective two-way communication process then businesses are more likely to comply and to enter into dialogue with a view to managing and resolving issues earlier in the process. Similarly, there is growing recognition that smaller businesses often have difficulty in accessing the necessary expertise which could assist them in complying with regulations. 
Regulators are also encouraged to consider evidence and risk profile throughout their policy planning and decision making so that enforcement action does not target processes which are clearly at the “low risk” end of the regulatory spectrum. 
Enshrining in law a duty for supervisory and enforcement bodies, albeit a specific number of them, to take account of the Code in their operations could help foster a commercial landscape where “enlightened” regulators actively play their part in the push for sustainable economic growth in Scotland. 
But it is not just their obligation. Businesses need to play their part too. And that means understanding why we have regulatory guidance, advice, licensing, inspections and, ultimately, enforcement, in the first place. As American columnist Molly Ivins memorably put it, “It’s all very well to run around saying regulation is bad. Of course our lives are regulated. When you come to a stop sign, you stop; if you want to go fishing, you get a licence; if you want to shoot ducks, you can shoot only three ducks. The alternative is dead bodies at the intersection, no fish, and no ducks. OK?”
The Consultation on Scottish Regulators’ Strategic Code of Practice document can be accessed at: http://www.scotland.gov.uk/Publications/2014/02/5027
Adam McCabe
Solicitor

A Working Group of business and regulatory representatives has prepared a “strategic code” document which is to referee how eleven specified Scottish regulators deal with those they regulate, with other interested parties and with the environment.

Naturally, the Code makes reference to the “better regulation” principles of transparency, accountability, consistency and proportionality. Mechanisms are to be put in place by regulators to minimise compliance cost where possible, to open up communication channels – including with each other – and to be alive to other interests when lining up their regulatory crosshairs, such as relevant interests of the local community. Formal impact assessments, for example, are not obligatory across all regulators at present but are highlighted by the Code as good practice when a regulator is considering implementing or changing a procedure.

The Code details how regulators can adapt their practices to contribute to achieving sustainable economic growth. There will be a legal duty on the eleven regulators to “have regard to” the Strategic Code of Practice in their decision making, standard setting and policy development.

Amongst that line-up of eleven are the Scottish Fire and Rescue Service, environmental body SEPA, charities regulator OSCR, the Food Standards Agency and the Accountant in Bankruptcy, as well as all Scottish local authorities (excluding planning authorities). The UK Health and Safety Executive (HSE) is not included and will continue to have its own enforcement policy.

The Code sets out the responsibilities and recommended approaches of Scottish regulators as “enablers”, able to reduce bureaucratic inefficiency and encourage ethical business behaviour while still delivering their core supervisory functions and contributing to growing the economy without damaging the environment.

A key premise of the Code is that good regulators seek to understand those they regulate. Where there is an open and effective two-way communication process then businesses are more likely to comply and to enter into dialogue with a view to managing and resolving issues earlier in the process. Similarly, there is growing recognition that smaller businesses often have difficulty in accessing the necessary expertise which could assist them in complying with regulations. 

Regulators are also encouraged to consider evidence and risk profile throughout their policy planning and decision making so that enforcement action does not target processes which are clearly at the “low risk” end of the regulatory spectrum. 

Enshrining in law a duty for supervisory and enforcement bodies, albeit a specific number of them, to take account of the Code in their operations could help foster a commercial landscape where “enlightened” regulators actively play their part in the push for sustainable economic growth in Scotland. 

But it is not just their obligation. Businesses need to play their part too. And that means understanding why we have regulatory guidance, advice, licensing, inspections and, ultimately, enforcement, in the first place. As American columnist Molly Ivins memorably put it, “It’s all very well to run around saying regulation is bad. Of course our lives are regulated. When you come to a stop sign, you stop; if you want to go fishing, you get a licence; if you want to shoot ducks, you can shoot only three ducks. The alternative is dead bodies at the intersection, no fish, and no ducks. OK?”

The Consultation on Scottish Regulators’ Strategic Code of Practice document can be accessed at: http://www.scotland.gov.uk/Publications/2014/02/5027

Adam McCabe
Trainee Solicitor

LChalmers