Better Regulation Program

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The Better Regulation Program is a wide-reaching initiative run by the German Federal Government that is designed to create better regulation and remove superfluous bureaucracy. The program was launched in 2006 and last updated in 2018.
What are the main aims and objectives?

The main aims and objectives of the Better Regulation Program are to reduce red tape, simplify regulations, and improve the overall quality of policymaking. The program seeks to achieve these goals through the implementation of more than 30 new steps and projects that focus on evidence-based decision-making, making laws simpler, and avoiding unnecessary burdens on businesses and citizens. By streamlining regulations and minimizing administrative hassles, the Better Regulation Program aims to support economic goals and create a more efficient and effective regulatory environment.

How does the program work?

The Better Regulation Program supports all Federal government departments, as well as the State Secretaries Committee on Bureaucracy Reduction and the Federal Government Coordinator for Bureaucracy Reduction and Better Regulation. Government departments remain responsible for complying with the rules on better regulation when drafting legislative initiatives and putting forward proposals. The Better Regulation Programme in Germany has introduced more than 50 measures and projects to reduce red tape and simplify regulations. Notable examples include:

  1. Brake on Bureaucracy: This rule states that for every new regulation that imposes administrative burdens, an equivalent burden must be offset within the same policy area in the space of one year. This ‘one in, one out’ rule helps to maintain a balance and prevents an increase in red tape.

  1. National Regulatory Control Council (NKR): Established in 2006, the NKR is an independent body that evaluates the impact of new regulations on businesses, citizens, and public administration. It also provides recommendations to simplify existing regulations.

  1. Standard Cost Model (SCM): SCM is an internationally recognized method for measuring administrative burdens. It helps to quantify the costs of regulatory requirements and identify areas for simplification and improvement.

  1. Online Access Act (OZG): This act aims to digitalize all administrative services by 2022, making it easier for citizens and businesses to interact with public authorities online, thereby reducing bureaucracy.

  1. Regulatory Impact Assessment (RIA): RIA is a systematic process to evaluate the potential economic, social, and environmental impacts of proposed regulations. It ensures that new regulations are evidence-based and their benefits outweigh the costs.

  1. SME Test: This test is designed to assess the impact of new regulations on small and medium-sized enterprises (SMEs). It helps to ensure that the needs of SMEs are considered during the regulatory process, and it minimizes potential negative effects on them.

  1. Participation Portal: This online platform allows stakeholders, such as businesses, organizations, and citizens, to contribute their ideas and opinions on draft regulations. It promotes transparency and enhances public engagement in the decision-making process.

What is the overall cost?

There is no information published on the various costs of running of the Better Regulation Program.

How was it implemented?

The Better Regulation Program was devised and implemented through a collaborative effort between various government bodies and stakeholders. The Better Regulation Unit (BRU) in the Federal Chancellery played a central role in coordinating and monitoring the implementation of the program. This unit aimed to reduce administrative burdens and ensure that Better Regulation processes remained tailored to German traditions.

The program involved the introduction of various tools and instruments to improve the effectiveness of legislative action. These included Regulatory Impact Assessments (RIAs) to systematically assess the impacts of legislative proposals and policies before their enactment. Another innovative aspect of the program was the institutionalization of independent advisory bodies, such as the National Regulatory Control Council, which was established to oversee the implementation of the program.

What impact has been measured?

The Federal Government can demonstrate that since 2006, the Better Regulation Program has permanently cut annual administrative burdens for businesses by €12.3 billion (approx. $13.5 billion). This represents a 25% reduction since 2006. Furthermore, the successes in reducing bureaucracy costs in the economy have been presented in a clear and transparent manner in the Bureaucracy Cost Index (BKI) since 2012. They can also demonstrate that companies have been saved €2 billion (approx. $2.2 billion) as a result of the 2015 ‘brake on bureaucracy’ as of 2018 and that the German economy has saved €2 billion as a result of the three Bureaucracy Reduction Acts.  

What lessons can be learned?

From the Federal German Better Regulation Programme, several important lessons have been learned:

  1. Collaboration is crucial: The success of the program can be attributed to the joint effort of federal, Länder, and local authorities, as well as various government bodies and stakeholders.

  1. Structured approach: The program's carefully structured approach to reducing administrative burdens led by the principles of transparency and evidence-based law-making

  1. Continual improvement: The program's ongoing efforts to improve the effectiveness, efficiency, and legitimacy of legislative actions have led to a better understanding of the German regulatory impact assessment system and increased transparency.

CURATED BY

Tom Hancock

Research Associate
Global Entrepreneurship Network
United Kingdom