Review shows room for improvement in the regulatory impact analysis system

New reporting released today by the Ministry for Regulation shows room for improvement in the regulatory impact analysis being provided to Cabinet.

When a Minister wants to create or change legislation, Cabinet requires that their agency analyse the likely impacts of the regulatory changes being proposed and sets this out in a Regulatory Impact Statement (RIS).

Over the period from 1 January 2023 to the end of 31 March 2025, the Ministry for Regulation assessed how well government agencies met this Cabinet requirement.

“Our report shows most Ministerial portfolios are meeting Cabinet’s requirements for impact analysis. However, we see room for improvement both in the quality of analysis provided by agencies and reducing the number of proposals that are missing analysis,” says Andrew Royle, Deputy Chief Executive Policy.

“The finding that a significant number of proposals were missing impact analysis spans multiple years, across many portfolios, indicating it is a persistent issue. While some proposals are exempted from the requirement, the numbers missing analysis is a concern.

“We also found that a decreasing proportion of RISs are receiving a ‘meets’ rating for quality of advice, and an increasing proportion of RISs are receiving a ‘partially meets’ rating for quality of advice.

“Regulatory impact analysis is an important tool to support decision-making. Completing analysis on proposals to Cabinet ensures Ministers have information on:

• the scope of the regulatory issue that’s being addressed, the rationale for government intervention, and the options for addressing it
• the costs and benefits of the proposal
• the views of the people who have been consulted on the proposal, and
• how the regulatory changes could be implemented, monitored and reviewed in the future.

“As a Central agency, we have a clear mandate to lead system-wide improvement to the regulatory management system. Ensuring that Cabinet is provided with meaningful, accurate and fulsome advice about regulatory impact is central to that.”

“Publishing this report is part of our commitment to supporting better regulatory practice, capability, and decision-making across government and contributes to an open and transparent regulatory process.

The Ministry for Regulation is currently working on how to reform the RIA system alongside the move to Consistency Accountability Statements (CASs) under the Regulatory Standards Bill, to make sure there is an effective and efficient system in place to give Ministers, Cabinet, and the public information about the impact of new regulation.

ENDS

Notes to editors:

Cabinet’s requirements for impact analysis are designed to encourage systematic and evidence-informed policy development, which helps support high quality regulation. They also help ensure Cabinet can make well-informed decisions about the regulatory changes being proposed.

Cabinet’s requirements for impact analysis are set out in full in the Cabinet Office circular, CO (24)7: Impact Analysis Requirements. 

Media contact: media@regulation.govt.nz