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About rules

An introduction to land transport rules, including the status of rules currently being developed.

How does the rule-making process work?

The regulatory context

Regulatory authorities around the world have been developing best practice regulatory principles to lift the quality of regulation by changing the way it is made.

Regulatory principles often cover matters such as:

  • proving that government intervention is warranted
  • making sure regulation is risk-based and focuses enforcement on what matters
  • encouraging positive behaviour to achieve compliance or to avoid regulation altogether
  • ensuring interventions are proportional and set at the minimum level needed.

In New Zealand, a commitment to review existing regulation and robustly test new proposals was set out in the Government Statement on Regulation: Better Regulation, Less Regulation) (external link) , which was released on 17 August 2009. The statement established the government‘s objectives for reforming the way that government regulates. In summary, the statement challenged the transport sector to find new ways of approaching regulation, including to:

  • introduce new regulation only when satisfied that it is required, and
  • review existing regulation in order to identify and remove requirements that are unnecessary, ineffective or excessively costly.

Regulatory stewardship

On 4 March 2013, Cabinet agreed to a set of expectations for agencies in exercising their stewardship role over government regulation.

The regulatory expectations outline at a high level how agencies should be designing and implementing regulatory regimes, and their stewardship role in administering those regimes. The expectations are that agencies will:

  • monitor, and thoroughly assess at appropriate intervals, the performance and condition of regulatory regimes to ensure they are, and will remain, fit for purpose;
  • be able to clearly articulate what those regimes are trying to achieve, what types of costs and other impacts they may impose, and what factors pose the greatest risks to good regulatory performance;
  • have processes to use this information to identify and evaluate, and where appropriate report or act on, problems, vulnerabilities and opportunities for improvement in the design and operation of those regimes;
  • for the above purposes, maintain an up-to-date database of the legislative instruments for which they have policy responsibility, with oversight roles clearly assigned;  
  • not propose regulatory change without:
    • clearly identifying the policy or operational problem it needs to address, and undertaking impact analysis to provide assurance that the case for the proposed change is robust;
    • careful implementation planning, including ensuring that implementation needs inform policy, and providing for appropriate review arrangements;
  • maintain a transparent, risk-based compliance and enforcement strategy, including providing accessible, timely information and support to help regulated entities understand and meet their regulatory requirements, and
  • ensure that where regulatory functions are undertaken outside departments, appropriate monitoring and accountability arrangements are maintained, which reflect the above expectations.

Regulatory tools

Regulation encompasses a range of instruments used by government to:

  • influence people or control the way people as individuals or groups behave;
  • achieve a diverse range of economic, social, safety and environmental policy objectives in the transport sector.

Traditionally, ‘regulation’ has been seen as establishing formal legal requirements by government, for example, by way of Acts, regulations and Rules.

A broader view of regulation takes in non-legislative policy tools such as information campaigns, education, persuasion, self-regulation or quasi-regulation (codes of practice, guidelines, etc, that can also influence behaviour).

The Transport Regulatory Policy Statement: expectations for regulatory development and practice 2012 (external link) (PDF, 713KB), prepared by the Ministry of Transport in collaboration with the three transport agencies provides expectations for best practice regulatory development and implementation.

A common regulatory development and Rule-making process

The Ministry of Transport and the transport agencies have adopted a uniform process for the development of policy and Rule-making (see Diagram 1). This places high importance on applying quality risk and regulatory impact assessments to determine when and whether a legislative intervention is most appropriate. It focuses particularly on developing Rules.

The process also clarifies the roles and accountabilities of the Ministry and transport agencies to build a shared understanding of expectations. The adoption by the Ministry and transport agencies of common guidelines is aimed at contributing to a regulatory development process that is transparent, consistent, timely and effective.

Please note that this is the standard process. It may need to be varied to suit the circumstances of a particular issue.

The phases of regulatory development and Rule production. [JPG, 27 KB]

Diagram 1: The phases of regulatory development and Rule production.

Regulatory development

The following phases are designed to assess whether a regulatory intervention is required to deal with a particular transport issue and if so, what sort of intervention is appropriate (including whether or not this requires the making of a Rule).

Policy Initiation phase. This involves an assessment of the issue/problem to determine whether further investigation of a potential regulatory intervention is justified.

Policy Investigation phase. If a case has been made for possible regulatory intervention, the purpose of this phase is to carry out policy analysis and engagement with interested groups to produce a Regulatory Impact Statement and to recommend appropriate regulatory intervention to the Minister. This phase may include the release of a discussion document seeking input into the policy development process. In the land transport area, this is known as a ‘blue’ draft.

Rule-making

If a decision is made that an issue is best addressed by legislating through the making of a Rule, instructions are prepared for the drafting of a Rule and any consequential changes to other legislation that may be required.

What are Rules?

Land Transport Rules (Rules) are a form of delegated legislation similar to Legislative Instruments 1. Rules are known as ‘Other Instruments’2. Most Rules are signed into law by the Minister of Transport (or his/her delegate who is a Minister of the Crown) under the Land Transport Act 1998 (external link) (the Act)3. The Act sets out the principles and the policy framework for regulating on a particular issue; Rules contain detailed requirements, including approved standards and processes, for putting those principles and policies into operation.

Most Land Transport Rules are drafted by the NZ Transport Agency, under an arrangement with the Secretary for Transport4. Rules help in achieving the government’s land transport goals by having objectives that include:

  • mandating safe and appropriate behaviour by road users, including setting requirements for the safe and efficient integration of the different modes of transport (walking, cycling, etc);
  • controlling the entry to, and exit from, the land transport system of people and vehicles; including implementing improved processes for driver licensing and testing and helping to ensure the safe and efficient operation of public transport services;
  • ensuring that vehicles that use our roads are built and maintained to safe standards and are operated safely;
  • ensuring that uniform and effective traffic control measures are in place on our highways and local roads;
  • providing for road controlling authorities to set safe and appropriate speeds as part of creating a safe road system.

Rules are drafted in plain language so that they can be easily understood and widely complied with. Each Rule must be economically viable, technically accurate and legally correct.

There are three types of Rule.

Ordinary Rules are made by the Minister of Transport (or an associate Minister). These Rules are made in accordance with the standard Rule-making process.

Emergency Rules are made by the NZ Transport Agency. As allowed by the Act, they can be utilised when it is necessary to “alleviate or minimise any risk of death, or serious injury to a person, or damage to property”. An Emergency Rule can only be made when it is not practicable to make an Ordinary Rule.

Rules made by Order in Council are signed by the Governor-General on the recommendation of the Minister. They would sometimes be used in situations where the Rule changes to be made were of such urgency or necessity that they justified a departure from the ordinary Rule-making process.

Rule Production

Rule Development and Consultation phase

In this phase (see Diagram 2), a Rule is drafted and accompanying information material prepared for release of the draft Rule for public consultation. The public consultation draft of a Land Transport Rule is known as a ‘yellow’ draft. An optional ‘red’ draft of the Rule may be sent to interested groups and individuals for comment before the release of a public consultation draft.

Draft Rules must undergo an appropriate level of consultation. For Ordinary Rules, this includes the publication of a notice of proposed Rule-making, allowing interested people a reasonable time to make submissions, and consulting with relevant groups and individuals both within and outside the land transport system.

Process overview of the Rule Development and Consultation phase. [JPG, 107 KB]Diagram 2: Process overview of the Rule Development and Consultation phase5.

Rule Finalisation and Signature phase

A final draft Rule, together with accompanying papers, and communications material for the signing of the Rule, is prepared (See Diagram 3).

If significant changes are made to the draft Rule following consultation, a ‘green’ draft may be released for the information of, and comment by, key interested groups and others. When the draft Rule has been finalised, it may also be referred to the Regulations Review Committee of Parliament for scrutiny before being submitted to the Minister.

If Cabinet has not previously agreed to the drafting of the Rule without further reference to Cabinet, or new policy changes have been added to the final draft Rule, a paper must be submitted to Cabinet to note the Minister’s intention to sign the Rule as redrafted. Interested government departments and agencies are given the opportunity to comment on the Cabinet paper. Cabinet must also approve the submitting to the Governor-General, for signature, of any amended regulations that are consequential to the draft Rule for example, in relation to offences and penalties for breaches of the Rule.

Following signing by the Minister, Ordinary Rules may come into force at least 28 days after the date of gazetting or on a later date specified in the Rule. Rules must be tabled in Parliament within 16 sitting days of signing. They are also referred to the Regulations Review Committee for scrutiny. This committee can recommend to Parliament that a particular Rule that it finds breaches the Standing Orders be disallowed.

Post-project Review and Evaluation phases

A post-project review of the Rule-making process is undertaken as soon as possible following the signing of a Rule. The review considers how well the regulatory and Rule production processes were undertaken, as well as the quality of the documents produced, the effectiveness of the engagement and consultation process and the timeliness of the project. The aim of the review is to apply lessons learned from the project to improving the future regulatory and Rule-making processes.

The transport Rule-making process also provides for an evaluation of the effectiveness of the Rule intervention to be undertaken after the implementation of the Rule.

Process overview of the Rule Finalisation and Signature phase [JPG, 117 KB]

Diagram 3: Process overview of the Rule Finalisation and Signature phase6.

Footnotes


1 Previously called ‘Statutory Regulations’. This new name was adopted in the Legislation Act 2012

2  Previously, Rules were known as ‘deemed regulations’.

3  Rules made by Order in Council are signed by the Governor-General on the recommendation of the Minister.

4  Some Rules (at present the Driver Licensing and Road User Rules) may be drafted and published  by the Parliamentary Counsel Office.

5 Extract from Regulatory Development and Rule Production Handbook. Ministry of Transport. 2012.

6 Extract from Regulatory Development and Rule Production Handbook. Ministry of Transport. 2012.

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