Taskforce proposes court challenges for bad regulation

Thursday 29th October 2009

New laws that offend principles of good law-making should be subject to Declarations of Incompatibility from the court system, says the report from Regulatory Responsibility Taskforce, released this afternoon by Regulatory Reform Minister Rodney Hide.

The declarations would have no practical effect beyond embarrassing a government and potentially assisting a push for reform, and are based on experience in the United Kingdom and Canada suggesting such an approach creates a more careful law-making environment.

The taskforce recommends that Ministers and departmental chief executives be required to certify new laws and regulations against a set of good practice regulatory principles, and to justify any departures, to make "the political and economic costs of new legislation and regulations clearer".

The Bill is philosophically similar to the Public Finance and Fiscal Responsibility Acts, both of which create discipline on government spending by requiring regular disclosure of the impact of government policies, without stopping governments from taking whatever policy decisions they wish.

Hide says he has already introduced the principles in the taskforce's proposals into the Cabinet Manual, which governs how policy proposals should be developed before going to the Cabinet for decisions.

He hopes by haveing done so to get Ministers comfortable with the approach in time to have the taskforce's Bill adopted as government legislation, to smooth its passage through Parliament before the next election. If that support is not forthcoming, it could be folded into a Members' Bill in ACT party MP Roger Douglas's name, currently before a select committee, Hide said.

The approach would only be applied to local government after central government was under the scheme, and would only apply initially to new laws. Existing legislation could not be challenged for 10 years.

"Anyone who feels that the principles have been breached and Ministers haven't been transparent about it can apply to the courts for a Declaration of Incompatibility," said Hide. "However, Parliament's sovereignty will be totally maintained, as the courts will not be able to stop or over-ride legislation."

Establishment of the taskforce, led by former Treasury Secretary Dr Graham Scott, was part of the ACT-National Party Supply and Confidence Agreement signed after the election.

The taskforce suggests boiling regulatory best practice down to 12 basic principles, including:

Clarity and accessibility, including no retrospective law
No loss of personal freedom or property rights, and justification on public good grounds if over-ridden
To compensate when property is taken for a public good purpose
No new taxes unless in an Act of Parliament
No charges that are unreasonably high compared with the benefit
No new law or regulation unless a "careful evaluation of the issue, existing law, the public interest, options available, who does and does not benefit, and all potential adverse consequences is undertaken"
No action if costs outweigh benefits
Effective, efficient, proportionate responses to issues.

Businesswire.co.nz

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