Some UK regulators have taken on significant new roles following
EU Exit. However, the work they are doing now to build their
capability and manage operational challenges may not align with
long-term ambitions or responsibilities, according to the
National Audit Office (NAO).
The government uses regulation to deliver a wide range of
policies, such as to ensure food safety, protect the environment,
and promote competition in the economy. Following EU Exit, many
UK regulators have taken on functions previously carried out by
the EU. Today's NAO report assesses how regulators have managed
this transition, focusing on three regulators whose work has been
significantly affected by EU Exit - the Food Standards Agency
(FSA), the Competition and Markets Authority (CMA) and the Health
and Safety Executive's (HSE's) role in chemicals regulation.
All three regulators have expanded roles following EU Exit. HSE
is now the main regulator for chemicals in the UK and the FSA has
more responsibility for assessing food and animal feed safety
risks. The CMA has established the Office for the Internal
Market1 and is setting up a unit to provide advice to
public bodies on state subsidies. The regulators have received
funding for their new responsibilities.
The regulators implemented measures aimed at ensuring continuity
after the end of the transition period on 31 December 2020. In
some cases this involved delaying new regulatory requirements or
extending deadlines. For example, the government extended the
deadlines for companies to meet the full data requirements for
chemicals registrations. The three regulators' plans to move from
interim arrangements to fully functional regulatory regimes are
still in progress.
All three regulators are finding it challenging to recruit the
specialist skills they need in some key areas, and there is a
risk that capacity constraints may delay regulatory decisions.
Several factors have also made it difficult for regulators to
plan their workloads and plan their capacity to meet it. For
example, the CMA has seen fewer merger cases than it planned
forin 2020-21 because of the economic impact of the COVID-19
pandemic.
All three regulators have lost access to data and information
sharing arrangements with EU regulators, which they say has
negatively impacted their ability to assess risks and carry out
their work. For example, the FSA has lost full access to the
Rapid Alert System for Food and Feed, which it used to exchange
information about food safety risks and responses across the EU.
The regulators are seeking to mitigate the impact on their work
by using other international systems, publicly available data, or
by setting up data sharing arrangements on a case-by-case basis.
There has been limited progress on regulatory co-operation with
the EU following EU Exit, despite the willingness of the
regulators and policy makers that the NAO spoke to. The UK has
stated that it is ready to progress co-operation on both
chemicals regulation and competition enforcement, but discussions
have not yet begun with the EU.
Policy makers and the three regulators are at an early stage in
setting the strategic direction for their areas following EU
Exit. For example, the FSA has recently published a long-term
strategy which set out broad ambitions but has not yet made
public detail on how regulation may change in practice.
All three regulators have taken steps to strengthen their
international relationships to improve the effectiveness of their
work and increase their influence outside the UK. In September
2020, the CMA signed the Multilateral Mutual Assistance and
Cooperation Framework with its counterparts in four countries to
strengthen co-operation. The FSA is increasing its engagement
with the International Food Safety Authorities Network and sits
on its advisory group.
The NAO recommends that regulators should review the plans they
developed before EU Exit now that there is greater clarity about
their capacity and their workload. They should test the realism
of their plans and assess if they can increase the effectiveness
of their work and find efficiencies. Regulators should also
ensure that as soon as they are able, they provide clarity to
stakeholders on their direction of travel and timelines for any
planned changes.
, the head of the NAO, said:
"EU Exit has had a major impact on many UK regulators. They need
to overcome many challenges if they are to manage the transition
successfully, including recruiting the right specialist skills.
It is essential that regulators and policy-makers develop their
future strategies as soon as possible to avoid wasting effort on
short-term work and to ensure the decisions they make now meet
their longer-term goals."
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ENDS -
Notes for Editors
- In December 2020, the government passed the UK Internal
Market Act to prevent trade barriers to goods and services within
the UK and established an Office for the Internal Market to
monitor and report on the UK internal market
