Understanding Regulation in Public Administration

• Lecture 6 is on regulation.

Defining Regulation

• Defining regulation is a difficult task.
• The state has moved from providing and distributing to steering.
• There are three types of meaning of regulation, from narrow to broader understanding.
• Regulation relies on institutions operating at arm's length, such as regulatory agencies.
• Regulation includes all mechanisms of social control.
• Regulation includes all efforts to steer the economy.
• Regulation includes an authoritative set of rules and mechanisms.

Regulation and Public Administration

• TPA (Traditional Public Administration) involves hierarchical, direct state control.
• NPM (New Public Management) includes restricting state regulation of the economy.
• NPM promotes public interest in cases of market failure or abuse.
• NPM creates new regulatory authorities (including supranational ones).
• More prescriptive regulation includes command and control regulation, and economic regulation.
• Lighter-touch and non-regulatory approaches include enforced self-regulation and voluntary self-regulation.

Governance and State Power

• State power is exercised through a regulatory framework, rather than monopolizing violence or providing welfare.
• There is a new regulatory state and self-regulation.
• There are 6 reasons for the 'rise of regulators': privatization, political protest, loss of trust, government initiatives, pressure from sectors, and new ethical problems (Brooke, 2003).

The Rise of Regulators

• Brooke identified 6 types of regulators in 2003.
• The old style public protection agencies
• The economic regulators
• Regulators of organizations
• Ethical regulators in science
• Professional regulators
• Regulators of regulators
• The Better Regulation Task Force is in the Cabinet Office.

Regulatory Independence

• Regulators can make decisions with little or no ministerial oversight.
• Regulation shifts the locus of control from state to regulatory body.
• A key focus is independence, including flexibility, being informed and impartial.
• Speaking truth to power and gaining legitimacy are key.
• Maintaining business confidence is important.

University Regulation in the UK

• HEFCE funds the quality of research and teaching.
• RCUK funds research and PGR training.
• The Office for Students
• The Competition and Marketing Authority
• QAA ensures quality of education.
• The Higher Education Academy improves teaching quality.
• The National Student Survey
• The Office of Fair Access ensures access.
• HESA collects data.
• The Office for Student Loans
• The independent adjudicator handles appeals.
• The Health and Safety Executive
• Professional accreditation bodies
• UKBA handles student visas.

Regulatory Overload

• Concerns exist about regulatory overload and accountability.
• There is an issue about the accountability of regulatory bodies themselves.
• It's unclear who regulates the regulators, audits the auditors, and inspects the inspectors.
• It's unclear who pulls this whole system together into some sort of coherent shape.
• Dr Tony Wright stated in 2003 that "the short answer is that nobody does."

Government Control

• Government influences regulation through policy frameworks.
• Government provides regulatory objectives that might be conflicting.
• For example, the case of Ofgem.
• Government provides guidance on priorities.
• Government appoints senior regulatory staff.
• Government uses resources to control regulation.

Regulatory Capture

• Regulatory agencies can be controlled by the industry they are charged with regulating.
• There may be special interests.
• Aggravating factors include capacity, corruption, and lack of transparency.
• The focus needs to be on capture as a process.
• An example is the Vioxx drug scandal (Heims & Moxon, 2023).

Under-regulation and Self-regulation

• Under-regulation occurs with technological advances and issues with keeping up.
• Self-regulation is when those to whom regulations apply are responsible for devising, maintaining and enforcing regulation' (Bevir, 2009: 172)

The Case for Regulation

• Advantages of regulation include precision, limited information required, and being inexpensive.
• Regulation is equitable (applying to all).
• Regulation can provide public legitimacy (e.g. through democratic process).
• There is a paradox.
• Disadvantages include neoliberal critique, potentially blunt instrument, and a weak state.
• Weak infrastructure can lead to poor compliance.
• Regulation can serve public interest or private interests.

Regulatory State Debate

• Is the rise of regulatory bodies a new form of state?
• It can be argued that regulatory agencies have significantly increased their power at the expense of the state.
• It can also be argued that the state relinquished control in less important areas.

The EU as a Regulatory State

• The EU functions as a 'regulatory state' (Majone, 1994).
• Factors include a rigid EU budget.
• The EC increased influence and competencies.
• MNCs prefer uniform rules.
• There is low credibility of inter-governmental agreements.
• The EU engages in market creation and management of externalities.

Regulation in the Global South

• There was a delay in institution-building in the 1990s-2000s.
• Western models were applied.
• Regulatory authority emerged, but was not depoliticised or fully independent.
• There is a high social salience of essential infrastructure, and incomplete markets.
• There are powerful external pressures.
• Redistributive politics creates winners and losers.

Conclusion

• Regulation has risen since the 1980s.
• Regulation attempts to create an impression of small government and free markets.
• Regulation remains problematic and contradictory.
• Whether regulation works in practice is a serious question and context matters.