First of all, it is good to see a Minister want to participate in a forum [0] as opposed to being pushed into it.  Congratulations Lindsay Tanner.

Let me first set the scene - at the moment I am sitting in my office trying to come to grips with a document nearly 400 pages long that talks about a new compliance framework and why it is better for a particular Government Department as opposed to the citizen or its service market. No, it is not an Australian Government Department. But it provides the impetus for the following thoughts: 

For those who were able to attend the recent GAP Congress on Regulatory Affairs [1] you would have taken heart in the work of Gail Greenwood and the Government of British Columbia where there has been a commitment to reducing regulation and red tape. In many ways, the Government and Institutions of Canada are very similar to those of Australia where we have various layers of Government from local authorities through to States and Provinces ultimately governed by a form of Federation. For those unable to attend the conference let me sum up the presentation by saying an Opposition, as part of its election campaign, wanted to reduce red tape and regulation, stimulate growth through friendlier and easier business terms tied together with transparency and openness.

The Opposition went on to win Government and the British Columbian experience is now part of the public record. In Australia we have an opportunity, through the commitment of the Minister and the current Government to implement something similar. The questions however need to be how, who, by when, who leads it and who needs to sign up to it to ensure it is a success. In doing so, we need to recognise that there are two fundamental forms of regulation. The first is domestic regulation and un-cluttering the myriad of duplication that exists between the Local, State and Federal layers. Everything from simplifying car and truck licenses to aligning standards for teacher registration. Bio-security and payroll taxes, translation of State awards into National awards and the removal of barriers that hold back business investment.

The second major category of regulation generally governs global markets or those sectors that are impacted by global trends, the international business system etc. Such regulation can be seen in the recent financial crisis that has gripped the global market and how different countries tend to deal with issues independently or as a group. There are regulations for regulations, systems for systems and red tape for blue tape. We also tend to categorise regulation dependant on segment, industry or sector - over the years, as this has developed and individual regulators and agencies have taken on responsibility for each specific area, regulation becomes disconnected from itself. For example, as we saw with the collapse of HIH each of the regulators who had a stake in that segment of the market HIH operated in, weren't always around the same table.

As we have seen with the current global financial crisis the regulators across the world came together because they had to - not necessarily because they felt, prior to the crisis, that there was a need to.  As the Minister points out - we want better regulation. We need to keep something pretty important in mind and that is simply this - at the moment there is a discussion on how much we need to do to lessen regulation from a business perspective.

Yes, there is the obvious economic argument that with less regulation and compliance costs, the more business is able to spend on employment, or it can be the impetus for increased business investment in the economy or sectors of the economy - benefits of which flow through to the community. The thing we tend to forget, however, is that for the vast majority of Australians they don't necessarily understand the regulatory framework or the implications of less versus more (let alone the benefits). If you were to ask a taxpayer in the suburbs of Western Sydney or my own suburb of Redfern if more regulation on financial institutions as the result of the current financial crisis was a good thing, they would agree.

I dare say the banks and industry may disagree. Herein lies the missing link for all of us - and that is the firm understanding that at the end of the day we need to engage the citizen in the discussion and the solution. That rightly brings me to the attractiveness of the Second Track Process that Peter Fritz advocates. Finding a medium that provides a balance between the needs of business and industry and the needs and demands of the citizen. Of course there is the political reality in all of this and that is the citizen elects the Government, not business and industry.  

So, let's explore some of the questions the Minister poses [1] and then proposition a few more: 

1. What lessons can we learn from good regulators? First of all, Australia now has some of the best regulators in the world. That said, they have developed more as a result of baptisms of fire than through natural evolution. HIH is a good example. That said, we have still got a way to go when it comes to engaging the citizen into the world of regulation and what it means for them. In 2002 I chaired the Global Knowledge Management Conference at which I asked a good friend of mine to speak on the subject of Energy Regulation and Information Management in the United States. His name was William Bennett and he was the Chief knowledge Officer of the United States Federal Energy Regulation Commission. FERC for short. The challenge was not only managing knowledge internally to ensure best practice and better regulation, it was also providing that knowledge and information to the citizen. Now, six years later, the FERC website is an example of what Australian regulators can learn in terms of interaction with the citizen. The site, www.ferc.gov [2], is targeted to both business and the citizen, there are forums for interaction, knowledge repositories and data stores. Access to hotlines, rules and regulations - ASIC has some of the functionality, but not all. In the bottom left hand corner is a section specifically for the citizen, links to guides, projects near you and informing people of their rights. Regulators need to think outside of the square - the ASX for example is not servicing business alone - therefore, be more inclusive. Our regulators could learn a lot from FERC. I should say when I led the Knowledge and Information Management Review of the former Australian Communications Authority in 2003 a lot of great best practice ideas came from FERC!

Question: isn't about time we thought outside the box we live in? What FERC may do could be relevant to ASIC or the ASX in terms of its aim and intent when it comes to communication - maybe we need to break down the barriers that have built up separating individual regulators and therefore there thinking. Why is that whenever we want to learn something new, we feel the need to go to another regulator in our industry to get the best practice?

2.  How could regulators use technology to regulate better? What are the barriers to its uptake? Yes they could - the FERC is the best example. The barriers are, as always, cost and time - but there is a third, understanding. Regulators need to understand how, who and why people interact with them. This is, again, the whole notion of push as opposed to pull - something Victor references in response to web2 technologies. At the moment I am reading through a recently published document from a Government (let's just say a Government in a land far, far away - and no its not here or across the ditch). The document talks about the development of a new online portal where the Government can interact with its citizens - the reality hasn't quite hit this particular Government yet, but the last time they tried this approach there was no time taken to understand who interacted with them back. Instead, I am half way through a review advising them that maybe, just maybe the people who do interact with the Government are mainly recipients of benefits and pensions and therefore cannot afford a computer and internet connection in order to interact back - so, how do we get them engaged? We take technology to the communities where they gather and we develop portals that provide information that is easy to understand and navigate. Technology, however, is not the only solution - content is the real hidden gem.

Question: here's a novel thought, lets establish a Commission for the eCtizen. A forum that brings together a raft of information and knowledge into one single repository. An repository who's construction is guided by the citizen, informed by the citizen and therefore with the citizen in mind. Underpinning this could very well be a range of formal processes and a combination of Second Track.

Question: can the software development companies stop making the pitch for why there software is world changing and the best thing since sliced bread? How about we look at the question in reverse - how can technology companies build better software to help regulators better inform business and the citizen - think collaboration platforms people!

3. Do you know of examples where alternative regulatory systems such as self regulation, co‑regulation or standards have delivered better outcomes than a traditional command and control model? First of all I need to say that I am a product of the New Zealand social and economic experiment of the 1980's and early 1990's. My Gough Whitlam was David Lange. Many people believe that for better regulation there is no closer place to look than New Zealand. What people forget is that New Zealand's environment was established out of a pressing need - to keep the country from going under. It took more than a decade of reform by a raft of ideologically opposed Governments all faced with the same dilemma. Some would argue that the economic and regulatory reforms went too far, David Lange also lamented that maybe the Government should have paused for a cup of tea. Some would also argue that New Zealand has been too far gone for too long and it is now in need of "pull back" reform. The school sector is one example of this where education and its management was devolved in the late 1980's and early 1990's.

Called "Tomorrows Schools", management, education policy, curriculum and qualifications were all unravelled and the day to day operations of public schools were handed over to elected parents on Boards of Trustees. Nearly twenty years on there are schools in the far north of the country whose members are unemployed and the school is in debt. Deregulation of the banking system has bought problems as has deregulation of social services and mental health. That said, there are shining lights - the Australia and New Zealand Food Standards organisation is one example where consistent regulations and best practice are in place. My point is, Australia needs to find a balance between the interests and needs of business and those of the citizen - also, a happy medium between consistency in regulation when it comes to regional standards. I remain an ardent advocate of Standards Australia and have for many years - even though I have never said so publicly let alone behind closed doors.  

An improvement could be made to the consistency in education and employment standards between Australia and New Zealand - the old Ministerial Council for Education, Training and Youth Affairs could be improved.

So, sadly, it is back to my 400 page document, then turning my thoughts on how to diplomatically inform this particular Government that sometimes just because it's 400 pages doesn't mean it is meaningful....to anyone other than the expensive consultants engaged to write it in the first place. Such is the work of a militant self regulator who is a product of the New Zealand Social and Economic Experiment.

Lindsay, I wonder, where would you place the Lange years in the greater context of the history of the Labour movement?