Part 4: The RIS Process

This section describes the steps involved in putting together a Regulatory Impact Statement (RIS), from the template to the publication process - including obtaining independent quality assurance (QA) and providing the RIS to Cabinet.

1  Preparing a Regulatory Impact Statement (RIS)

The RIS is a government agency document, as distinct from a Cabinet paper which is a Minister's document. The RIS provides a summary of the agency's best advice to their Minister and to Cabinet on the problem definition, objectives, identification and analysis of the full range of practical options, and information on implementation arrangements. By contrast, the Cabinet paper presents the Minister's advice or recommendation to Cabinet.

The purpose of the RIS is to:

• provide the basis for consultation with stakeholders, and with other government agencies
• provide the basis for engagement with Ministers and therefore helping to inform and influence the policy discussion and Ministers' decisions
• inform Cabinet about the range of feasible options and the benefits, costs and risks of the preferred option(s), and
• enhance transparency and accountability for decision making through public disclosure once decisions are taken.

The RIS should provide an objective, balanced presentation of the analysis of impacts, with any conclusions reached by the agency explained and justified.

It should be prepared before the Cabinet paper, so that it informs the development of the preferred option and hence the Ministerial recommendations in the Cabinet paper. It should provide a reference point from which the Cabinet paper is developed, thus avoiding the need for a lengthy Cabinet paper and repetition between the two documents.

1.1  Required information

The RIS must contain the following information:

• agency disclosure statement (ADS)
• description of existing arrangements and the status quo
• problem definition
• objectives
• options and impact analysis - identification of the full range of feasible options, and analysis of the costs, benefits and risks of each option
• consultation
• conclusions and recommendations
• implementation plans, including risks, and
• arrangements for monitoring, evaluation and review.

A preferred option may be identified and discussed, but this is optional. Similarly, while the RIS needs to cover the policy problem being addressed, it is not required for the preferred option in the RIS to be reflected in the Cabinet paper (for instance if the Cabinet recommendation diverges from the Agency’s advice). However, if possible the RIS should address the potential impacts of the recommendation in the Cabinet Paper alongside the alternative feasible options.

If the RIS does not cover options that form recommendations in the Cabinet Paper, the Agency Disclosure Statement should outline these options and explain why they do not form part of the RIA.

The required information, and a suggested template, is set out in more detail in Annex 4.1.

1.2  Agency Disclosure statement

The agency is required to complete an agency disclosure statement (ADS) on the front of the RIS, which:

• discloses information to highlight any key gaps, assumptions, dependencies and significant constraints, caveats or uncertainties in the analysis, and
• is signed by the person with responsibility for the production of the RIS.

The disclosure statement should be completed before the RIS is submitted for quality assurance, and included with the RIS that is provided to the reviewer. This is different from the disclosure requirements described on page 3.

The ADS needs to identify gaps or constraints in the analysis and briefly identified the proxies used to fill these gaps, or the assumptions to overcome the constraints. This should give the reader an accurate sense of the level of analysis conducted in the RIS and give Cabinet (as the ultimate decision-maker) an appreciation of the level of reliance that can be placed on that analysis.

The ADS should not be an executive summary of the RIS and should not present detailed background - it should focus on constraints or the analysis and signal any major impacts that might pose risks. If timing or previous decisions have constrained analysis, the reasons or previous decisions and RISs should be clearly but briefly explained.

1.3  RISs for in-principle or intermediate policy decisions

As noted in When so the RIA requirements apply? (see Part 1), the RIA requirements apply when in-principle or intermediate policy decisions are taken by Cabinet. This is particularly important when options are narrowed down (eg, particular options are selected for further work, and/or options are removed from consideration). At these points, it may not be possible to prepare a comprehensive RIS. Instead, a draft or interim RIS may be prepared.

Draft or interim RISs may need to be updated for subsequent Cabinet decisions, to reflect the results of further analysis and any additional or new information that is available.

When a series of policy decisions is taken, it can be useful to refer to the RISs that were prepared for previous decisions. The nature of the earlier decisions should be explained, and URLs to the previous RISs provided. This background information can be presented in the status quo section, or as a separate introductory section.

1.4  Consultation and circulation

The draft RIS should be circulated for comment to relevant government agencies. Ideally, this should be done before the Cabinet paper is prepared. Otherwise it must be circulated with the draft Cabinet paper. It must also be included with draft Cabinet papers when they are submitted to Officials' Committees.