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Finding out the real cost of new Welsh laws

25/10/2017

​The Welsh Government should consider options to monitor and evaluate how much new laws are actually costing, according to a National Assembly committee.

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The Finance Committee believes closer scrutiny is needed to find out where costs are coming from and who is incurring those costs, and to ensure the accuracy of how estimates are put together when laws are first introduced as bills.

Although financial estimates of proposed legislation are scrutinised as part of the Assembly's law-making process, it only happens at the first stage when a Regulatory Impact Assessment (RIA) is published along with a Bill.

The Finance Committee noted that it would be possible to amend the RIA at later stages without suitable scrutiny of the changes.

In the case of the Additional Learning Needs and Education Tribunal (Wales) Bill a £12.7 million alteration was made to the Welsh Government's estimate.

On that occasion, at the request of the Finance Committee, the government agreed to delay the Bill's progress to allow further scrutiny.

The Committee also wants to see more scrutiny of costs incurred through subordinate legislation, such as regulations which are added after a law is passed. Currently there is no formal mechanism to establish the accuracy of the estimates.


"We are recommending that the Welsh Government do more to ensure that public bodies are not routinely incurring higher costs than those anticipated."

- Simon Thomas AM


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"Public finances are coming under increasing pressure as austerity and uncertainty surrounding Brexit continue to take their toll," said Simon Thomas AM, Chair of the Finance Committee.

"As more powers and responsibilities are devolved to the Assembly it is essential we have robust procedures for ensuring both laws and the costs that come with them are as accurate as they can be for the people of Wales.

"This Committee accepts that the estimates which accompany new legislation are just that, but we believe that there should be more opportunity to monitor and evaluate these costs, both to ensure value for money, but also to increase the accuracy of the processes which produce the estimates in the first place.

"We are recommending that the Welsh Government do more to ensure that public bodies are not routinely incurring higher costs than those anticipated, and that the Assembly is informed when there are significant alterations made to RIAs."

The Committee makes 14 recommendations in its report, including:

  • That the Welsh Government should build evaluation periods into its assessment of the costs of legislation to allow for review and evaluation of transitional funding;

  • That the summary information included in RIAs contain explicit reference to how any costs identified in the RIA will be funded and by whom; and

  • That the Welsh Government commit to providing as full a picture of the costs of subordinate legislation as possible when proposing primary legislation.

 
The report has been sent to the Welsh Government for consideration.

 


Read the full report:

 

Inquiry into the financial estimates accompanying legislation (PDF, 446 KB)


 

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