Regulatory Review Group minutes: April 2024

Attendees and apologies

• Professor Russel Griggs OBE, Chairman 
• Susan Love, Association of Chartered Certified Accountants 
• Fiona Richardson, Convention of Scottish Local Authorities 
• Brian Lawrie, Society of Chief Officers of Environmental Health in Scotland 
• Ewan MacDonald-Russell, Scottish Retail Consortium 
• David MacKenzie, Trading Standards 
• Alistair Hill, Consumer Scotland 
• Wendy McCutcheon, Scottish Government
• Andrew Forrest, Scottish Government
• Claire Ross, Scottish Government
• Jayne Winter, Scottish Government
• Melanie Macrae, Scottish Government
• Ross Stephen, Scottish Government (Secretariat) 
• Alex Kidd, Scottish Government (Secretariat) 
• Rachel Dolan, Scottish Government (Secretariat) 

Apologies:

• James Fowlie, Convention of Scottish Local Authorities

Items and actions

Welcome, introductions and approval of minutes  

Professor Russel Griggs OBE welcomed and thanked attendees for traveling to Glasgow to hold this Regulatory Review Group (RRG) policy spotlight meeting in person. Minutes from the previous meeting (19 March 2024) were approved and Scottish Government officials confirmed the Group’s work programme up until summer recess. 

Energy Strategy and Just Transition Plan (ESJTP) 

Policy officials from DG Net Zero were introduced and presented on the Energy Strategy and Just Transition Plan (ESJTP). A facilitated discussion then took place where the following key points were raised:

• The importance and complexity of the ESJTP was noted by members. There was focus on ensuring that SMEs are engaged throughout this process as there are many larger corporations within this space that will have the capacity to ensure their voices are heard. It was also noted that business understanding and support for the content of the ESJTP is critical to ensuring effective implementation.
• Policy officials confirmed engagement with the Scottish Energy Advisory Board as well as CBI and CoSLA. There has also been engagement with SMEs. This engagement will continue post publication into the implementation phase.
• Members agreed they are impressed with the ESJTP detail presented, however emphasised that there is a real challenge within this sector to ensure it is futureproof and can be adapted with technological advances. Members advised officials to consider the cumulative impact on business and ensure the ESJTP will complement and work with other existing policies as well as those currently in development. Officials confirmed the Just Transition Commission, a scrutiny body, as a mechanism to have oversight of the ongoing work to support a just transition in pursuit of the Scottish Government’s target to reach Net Zero by 2045.  
• National implications should be considered, and the BRIA should reflect and capture what the potential knock-on effects of this Strategy will be for business to mitigate any issues that may befall to SMEs. It was noted that more research may be needed to understand further how SMEs will be affected and if there are possible ways to intervene in the market or support to ensure SMEs are not disadvantaged. A point was also raised that there could be unintended consequences to business who consume a lot of energy and not only those who trade in the energy sector. 
• There is a skills gap within this sector but also with the regulators. It was noted there is an added risk around resource for regulators. Re-training will be needed and with a risk of rogue traders, it would be helpful to have a co-ordinated approach to this. Planning will be necessary for business to comply with the new policies that will be coming into place, however, taking an overall approach to this will create opportunities for business. 
• Due to the nature of the ESJTP and how it will affect everyone in Scotland, messaging and communication is extremely important. This must be considered extensively to ensure consumers are given enough time to understand the transition and the changes that will apply. Communication should be clear to ensure SME’s can understand and comply with new regulations, noting there may be challenges with differing messages for SMEs to gain contracts. Officials confirmed fuel poverty was prevalent within their consultation and they have been working closely with the policy officials who lead on this. Members noted there may be unintended consequences regarding the way this is communicated as consumers may begin to feel exacerbated by fuel poverty and disconnect.

Members agreed it would be useful for policy officials to return to the Group once the Strategy has been published to provide an update and more information on the next steps, focusing on the delivery and implementation.

BRIA discussion

A policy official from DG Economy was introduced and presented on the updated Business and Regulatory Impact Assessment (BRIA) toolkit and guidance. It was noted that members have been part of the extensive engagement process to refresh and update the BRIA, and their feedback incorporated into the final version shared ahead of the meeting. 

A facilitated discussion then took place where the following key points were raised:

• Members agreed an enhanced exemption process should be developed where the Cabinet Secretary who holds the responsibility for regulation should have oversight to mitigate the risk of inconsistencies across BRIAs. An assessment should be required to show there will be no impact to business to be exempt from conducting a BRIA. The Group noted the importance of a robust sign-off process, with exemptions but also with finalised BRIAs will be essential to ensure they are fit for purpose.
• Members praised how detailed the updated BRIA is but highlighted that there is a large amount to consider, the broader and overarching reason for completing a BRIA to assess the overall impact on business should not be forgotten. 
• There was a suggestion to include a communications section within the implementation portion of the BRIA, to consider what communications would be required to reach out to business. 
• It was highlighted that the main challenge for small business is time and resource, which applied to both engaging on policy development and implementing new guidance/ requirements. This should be considered within the business forms section, trying to streamline forms and registration processes for business minimising the requests and requirements they must comply with. 
• The importance of starting the BRIA process early was noted and specific proposals within the Programme for Government and Budget should be highlighted. Consultation can be far down the policy development line and so it is essential that at least a partial BRIA is completed before then. It was also noted that regulators should be involved early in the process to ensure that the policy and required enforcement is feasible as well as securing finance to guarantee it can be delivered and implemented. The Group agreed if the points raised cannot be incorporated, an option to reassess the policy should be encouraged. 
• The Group discussed how and when small businesses should be engaged and noted the risk of policy officials continuously going to the same businesses that had capacity/ willingness to engage and provide their opinions. 

There was a wider discussion around the RRG’s role regarding BRIAs and how they should be monitored. There was a suggestion to RAG review a sampled selection of the BRIAs which could be provided to members on a quarterly basis. There was also discussion around Local Authorities holding formal responsibility within the BRIA process to engage and an SG policy official confirmed the aim is to create a tool which will cover all impact assessments to streamline the policy development and engagement process. 

Any other business

There was a discussion around Framework Bills and whether the RRG should provide advice to Ministers on what should be included within these. It was agreed the Group will look do this in future and should be included within the work programme.

Primary authority was raised within the Group, with members agreeing this should be added to the agenda at a later meeting to discuss in further detail. It was agreed the RRG would invite members of Consumer Scotland and Scottish Government policy officials to present on Consumer Duty and the Visitor Levy Bill at the next meeting held virtually on 30 May 2024. Officials will issue invitations on behalf of the RRG.