Public & Social Sector Regulators Forum

In September 2021 we held a networking forum for UK regulators in the public and social sector to discuss the principles of effective regulation.

We brought together our clients in the UK regulation sector following the issue of the recent publication of the Good Practice Guide for Regulation from the National Audit Office (NAO).

The NAO publication is based on their experiences working with regulators over the last 10 to 15 years. NAO has published other thought leadership work on regulation, such as their 2016 piece on performance management. NAO is currently undertaking other review work within the regulatory sphere.

Good practice guidance: what makes effective regulation?

We were joined by Rich-Sullivan-Jones, Audit Manager at the NAO, who walked us through the good practice guidance and provided helpful examples of regulation, such as within the gambling industry. Although the Gambling Commission has many powers, lack of resources is an issue and it is reliant on the wider industry and other organisations to operate effectively.

It is important that organisations consider their overall approach to regulation and this is a point that NAO very often re-emphasises to regulatory organisations. Organisations should also consider what is the appropriate model in the appropriate circumstances.  

NAO considers the key elements of the NAO framework to be: 

NAO framework - Design, Analyse, Intervention, Design

A roundtable discussion with UK regulators

After Rich’s presentation, we moved on to a roundtable discussion. The discussion included the risk of the fluctuating political environment and changes in government, ministers, and policy emphasis. Even if there are no changes in ministers or legislation, political views may still change.

How do regulators quote

We agreed that influence is important. Regulators’ relationship management teams should be forward-facing with the government and forge good relationships on an ongoing basis. However, the pushback to the regulatory sector is that it needs to consider political risk and it is important that regulators demonstrate value for money and transparency.

There can be a reluctance from regulators to engage with the government and put forward evidence and operate in a fully transparent manner. He did however acknowledge that this is not always easy to do.

It was noted that engagement with the government needs to be managed carefully and regulators do not seek to lobby, given their role and status. 

We also discussed balancing a professional view versus political expediency and media pressure. There has been a lot of pressure within some sectors over the last 18 months and relationships and transparency are key. Organisations have had to maintain independence, but also provide greater oversight. There is often a tension between relationships and transparency.  

We also discussed challenges around staff and workforce and how to go with the political flow. There is also a balance between where a regulator’s Board sits, and where the regulator’s workforce sits in politics. There is a role in regulating government and that is an interesting dynamic. Change in key personnel can enable a regulator to look again at the optimum regulatory structure and design principles, and how these are put into practice. 

The NAO’s new guide is aimed at policymakers and government, as well as regulators. The NAO recognises that regulators may do a great deal of thinking on an appropriate model of regulation but sometimes cannot get their message through to the government. The guide may therefore help to facilitate these discussions between policymakers and regulators. 

Regulators model of regulation quote

Regulatory organisations are grappling with data. Regulators need to assess what data they have access to and what data they need. They need to take time to define who their customers are and engage in stakeholder management. There are regulators who have invested in CRM systems for stakeholder management that can support organisations to make calculated judgements about engagement. 

Workforces having different views to their Board and the respective minister is also a huge issue and something that the Mazars team are seeing examples of. 

Thank you to everyone who attended the forum and participated in the discussion. It was great to hear the views and issues faced by different regulators. We are hoping to host another forum in March of next year. 

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If you would like to discuss any of these topics in further detail, please get in touch.

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