HISTORIC PRESS RELEASE : Andrew Smith welcomes Utility Regulators response to efficiency review [July 2001]

The press release issued by HM Treasury on 2 July 2001.

Gas and electricity, water, rail and telecommunications regulators have prepared individual action plans to implement the recommendations of an independent efficiency review published earlier this year. The key recommendations have been accepted, and each regulator has taken steps to implement priority recommendations. They will update industry and consumer representatives on further progress over the coming months.

Chief Secretary Andrew Smith commented:

“The independent report concluded that the UK Regulators are professionally run organizations. The regulators positive response to this report will led to further improvements in UK regulatory standards.

Implementation of their action plans will increase transparency in budget setting, lead to better assessment of the costs and benefits of major projects, spread best practice, and help the regulators recruit and retain quality staff.”

The key elements of the improvements are:

• Increased transparency in budget setting;
• more effective stakeholder involvement ahead of publication of draft annual plans;
• draft annual plans to include more detailed cost information including identifying all projects over £250k;
• policy and support costs identified separately wherever possible;
• better impact assessment of costs and benefits of major projects;
• annual publication of each regulator’s medium-term strategy. (Oftel which will review its medium term strategy as part of its preparatory work on Ofcom);
• developing the most appropriate form of regulatory impact assessment;
• post-implementation value for money reviews of major projects.

Retaining skills and expertise:

• regulators to pay more competitive rates to recruit and retain key staff; and, in return:
• regulators will continue to look for efficiency savings particularly in consultancy and support services.

Spreading best practice:

• better profile for joint working initiatives;
• more systematic identification and sharing of best practice;
• regulators to agree a consistent set of support service activity indicators with the eventual aim of publication.