New Deal for Business Group - Report on Progress & Recommendations: Implementation Plan

Annex A - Sub-Group 1 – Regulation

Overview

The Joint Business Regulation Taskforce was established in December 2022 following the Emergency Budget Statement in response to the cost crisis, on 2 November 2022, where the former Deputy First Minister committed to "establishing a Taskforce with COSLA, local authorities, our regulatory agencies and business to consider the differing impacts of regulation on business and drive early progress on the commitment made in the National Strategy for Economic Transformation to review and improve the process of developing, implementing and reviewing regulation to meet our economic and societal aims for the longer term."

The Taskforce met for the second time in February this year and following the changes at Ministerial level, the group was chosen to become the sub-group of the New Deal for Business Group (NDBG), focussing on regulations, with an objective to identify recommendations to improve the way the Scottish

Government develops and implements policy proposals which have an impact on business and how business engages with that process.

The purpose of the Taskforce, now sub-group, is to provide a forum to discuss and, where possible, act on concerns raised by businesses, regulators, and other stakeholders. The ongoing cost crisis highlighted the cumulative impact of not only increased costs, but also the resource required to understand, plan, and invest to comply with the range of regulations in development, both at UK and devolved level. This is especially difficult for small and micro-businesses.

The Scottish Government made a commitment in NSET to review and improve our process of developing, implementing, and reviewing devolved regulation to meet our economic, environmental and societal aims for the longer term, while also supporting our international commitments. This work will help us meet that commitment.

The First Minister set out in the Programme for Government (2023/24) his intention for the Scottish Government to work with business to develop a process for identifying, considering, and if appropriate, removing regulations no longer required, and to propose new regulations to support businesses in Scotland. This process will be delivered through policy cycle reform work undertaken in the short-term.

Recommendations

This sub-group presented 38 recommendations – 23 to be actioned in the shortterm (6 months), 11 over the medium-term (12 months) and 4 over the longerterm (18 months).

How we report on progress

Success in implementing the recommendations around business regulations will be measured in the longer-term by the improved relationship with businesses in developing and implementing any new regulations that Ministers decide to take forwards. We recognise that an improved relationship with businesses will not mean that they do not raise any issues with regulations. However, it should result in fewer significant concerns and more effective implementation of new regulations.

Interim measures of success will include positive feedback from business representatives and stakeholders of the:

• Purposeful relaunch of the Regulatory Review Group (RRG), which makes timely recommendations to Scottish Government officials and Ministers on areas of concern with regulations. We will develop a programme of work in partnership with the RRG membership for the coming six months, ensuring that it is focused yet responsive to the regulatory issues most affecting the economy.
• Development and implementation of an effective process for identifying and assessing opportunities for new devolved regulations and removal of regulations. We will strive to ensure that stakeholders view process change as a worthwhile improvement and that it has resulted in thorough examination of their concerns.
• Revised Business Regulatory Impact Assessment (BRIA) process and its value as a tool in assessing and reporting projected impact on business. This includes work to consider the specific impact on small businesses.

We will also assess the usage of updated BRIA templates, support toolkits and training to help inform measurement.