UK legislative impact assessments failing, Lords report
The UK Government's impact assessment system for secondary legislation is failing Parliament and the public, according to a committee of the House of Lords in a report published today.
The cross-party Secondary Legislation Scrutiny Committee scrutinises hundreds of statutory instruments laid before Parliament every year. In its report entitled Losing Impact: why the government's impact assessment system is failing Parliament and the public, the committee claims that the poor quality information provided is a further illustration of the growing imbalance in power between Parliament and the Government.
It notes that although the dual challenges of Brexit and the COVID-19 pandemic meant it was necessary for a time to produce legislation at speed, these emergencies have now largely passed. However, the number of impact assessments done badly, or simply not made available for scrutiny by the committee and Parliament alongside legislation, has increased.
Committee chair Lord Hodgson of Astley Abbotts explained: "When done correctly, an IA [impact assessment] is a document that should set out clearly the purpose and justification for an instrument as well as the alternative ways the policy could be achieved. The IA should not just be an item on a 'to-do list' but an integral part of the policy formulation process. As such, IAs play a critical role in enabling Parliament to hold the Government to account.
"However, we have found that IAs are being treated like speed limits – everybody says they are a good thing, but some take a more flexible attitude to complying with the requirements than others."
The report highlights the importance of IAs and the reasons why they are a crucial part of practical governance and good policy formulation, helping to ensure that legislation is cost effective and has had a proper level of public consultation. Departments that lay an IA late limit the opportunity for those affected by an instrument to challenge its content or the Government’s assumptions.
In one example of the Home Office revoked legislation to license a chemical that could also be used as a drug, the day before it was due to come into effect. It had believed only 65 firms used the substance, but an industry body subsequently stated the figure was closer to 7,500 firms and the system envisaged would, therefore, not work.
The report emphasises that IAs, and other legislative supporting information such as explanatory memoranda, are not just “paperwork” but crucial in informing policy development as well as scrutiny both by Parliament and those directly affected by it, and must be available when an instrument is laid.
It also draws attention to the fact that nearly half the instruments were not subject to any post-implementation review ("PIR") despite this being required by statute. These PIRs play a vital role in checking whether the estimates were accurate, predictions were fulfilled and that the policy had achieved its intended outcome. In addition, the report cites the lack of a central authority enforcing the statutory provisions as a key reason for the weaknesses in the system.
Lord Hodgson added: "Providing Parliament with poor quality impact information, or only providing the information after the scrutiny process is over, is another example of the transfer of power from Parliament to the executive that we highlighted in our Government by Diktat report.
"This new report identifies areas of weakness in the current system, and we urge the Government to address promptly the recommendations we have made as part of its review of the Better Regulation Framework. We do not consider our proposals unreasonable, given that departments were able to produce IAs to a much better standard in the years before 2017.
"In particular we draw attention to the lack of post-implementation reviews as a reason for the failure to build up 'institutional memory' to improve future performance."
He concluded: "If Parliament is to perform its critical function of holding the Government to account, it is of paramount importance that the two Houses are given complete and comprehensive information about the basis on which policy choices are made and the reasons why alternative options have been rejected. We cannot perform that role without the right information at the right time."