 Home, everybody. Thank you very much for logging in to this presentation on re-thinking responsive regulation. I hope you find the presentation clear and informative and helpful. And before I begin, I just like to thank Safe Work Australia for inviting me to give this presentation. It's a great privilege and honour to do it. Now, what I'm going to do today, is introduce you to the contemporary thinking about responsive regulation. And I'll start with a bit of history ac yn dotar, y gallwn y cyffredigau bwysigfyr rhagorau llwyaf nawr, ar yr ysafodol ar oeddo cym新iad fan ruiduaeth Simon a'r llwyaf yw'r rheidion a'r llwyaf a'r gweithwyriau. Ond rwy'n ei wneud byddai gyflyniadau y bwysigfyr rhagorau llwyaf yw ac oedd y bwysigfyr rhagorau llyfry am arwag ein llyfr gwrthwynau. Y bwysigfyr rhagorau llyfr behel yn unwyr yn rawr â'r rhagorau llwyaf. Second, the two pyramids that Areson Braithwaite's theory of responsive regulation is famous for, that is the enforcement pyramid and the pyramid of regulatory strategies, and then I'll finish with a discussion of tripartism where third parties are brought into the regulatory game, and then I'll conclude with some reflections of the potential difficulties of implementing responsive regulation. Now I indicated in that introduction that responsive regulation developed in response to debates about command and control, so at this point it would be good to explain what I mean by command and control. And as the PowerPoint indicates, command and control is the deliberate attempt by the state to influence socially available behaviour which might have adverse effects by establishing, monitoring and enforcing legal rules. And the two key ideas there are the state is involved and the state's key instrument is the use of legal rules. Now a responsive regulation was to a large extent a response to some issues that had arisen out of command and control regulation. So for example, those who wanted stronger command and control regulation were arguing that command and control wasn't properly implemented by the state, there wasn't enough enforcement, penalties weren't high enough, and as a result command and control regulation was ineffective for their purposes. Against that were the proponents of deregulation who argued that command and control regulation was stifling initiative, it involved too much red tape, and generally it had a bad impact on business activity. And then there was a third group that argued that really social life was just far too complex to be regulated by a blunt instrument like command and control regulation, so that really sets the tone and the space for the debate about responsive regulation. Now the key player in responsive regulation is John Braithwaite, and I'm giving this talk in Canberra, and John works just down the road at the Australian National University. And it started with an observation about a policy dynamic. So it starts off with an empirical observation about how things work best, and then over time it's theorised. And there's a larger debate involving lots of academics and policy people. So I just want to talk briefly about what underpins responsive regulation, if the theory is underpinning it. And the first thing is microeconomic game theory. Now that may not be a term familiar to most of you, but let me talk about it briefly. Game theory really examines how intelligent individuals interact with each other to achieve their goals. And probably the best example of game theory is the so-called prisoner's dilemma. And that's a situation where the two players are prisoners, they've been arrested for a crime, and they're placed in separate cells, and they're involved in negotiations with the police. But whether they plead guilty, or whether they fight the offence. And obviously for some prisoners, if they confess and testify against the other prisoner, they're let off for the crime, and the other prisoner gets a very heavy sentence. If they both agree to confess, they'll both be convicted, but with lower penalties. And if one of them fights the charge of the other, and if both of them fight the charges, then they might get off, but they might be convicted and face very high penalties. And so game theorists play around with those notions and explore how they work under different circumstances. Now you might be wondering how that applies to regulation. And in regulatory theory, and if you read Areson Braithway's very famous book about responsive regulation, you'll see lots of discussion of game theory in the prisoner's dilemma, but in the context of a firm and a regulator. And Areson particularly explores the way that regulators and firms can play off against each other in relation to cooperation and breaking away from cooperation. So that's the first underpinning theory. The second is responsive regulation is underpinned to a large extent by John Braithway's extensive empirical research and reading in criminology, sociology, political science and psychology. So it's very much an interdisciplinary, multidisciplinary exercise. And thirdly underpinning responsive regulation is the notion of civic republicism. And that envisages a mixed institutional order where the state and associations or different institutions counterbalance the power of others by surveillance and by exercising their own power. So as the PowerPoint shows, each exercises a countervailing power over others and checks the great dangers of where one party, one institutional order is stronger than another. Another crucial aspect is direct citizen participation where citizens involve themselves in various forms. It can be politically, it can be as a player in the market, it can be as a member of a public interest group or in any other sense. And the whole idea of responsive regulation is to merge two ideas. The first is state regulation and the second is private facets of regulation where individuals and groups privately regulate particular orders. And the great strength and the great insight from responsive regulation is the way that the public and the private interface and the way that the state steers private regulation. OK, now let me move to the key principles of responsive regulation. The first thing to say about responsive regulation is that it's distinguished by what triggers a regulatory response and what the regulatory response will be in any circumstance. In other words, it's a very flexible process. The whole idea is that regulators look at the context and determine in the context which is the best balance of regulatory approaches. And there are two really key ideas that you need to understand to properly understand responsive regulation. The first is the notion of regulatory delegation and the second is the notion of monitoring that regulatory delegation with an escalating intervention by the state. So let me go through those two key ideas a bit more slowly. Firstly, a responsive regulation involves regulatory delegation of regulatory functions to private actors. And these private actors can be public interest groups, trade unions for example, can be industry associations, can be firms, individual firms or could be independent professionals. And the whole idea of delegating regulatory functions is to try and harmonise the state's regulatory objectives with the laissez-faire notions of market efficiency. And it's not hard to see that that's an important aspect of regulation that fits in well with some of the other themes of Safe Work Month got to do with productivity and sustainability and leadership. So that's the first aspect, regulatory delegation. The second aspect is monitoring that regulatory delegation by escalating state intervention. And the most famous examples, as I mentioned earlier, of this escalated state intervention is the enforcement pyramid, which I'll deal with in a moment, and also the pyramid of regulatory strategies, which is my third example. So the exact form of regulation, the exact form of the balance between these two key principles depends on context. It depends on the industry, it'll work best, it'll work in different ways in different industries, it depends on the regulatory culture, it depends on the history of regulation in the particular industry, it depends on the motivations of the actors and it depends just on how well they are self-regulating. OK, now let me move to my first example, and that's the example of enforced self-regulation. Now, I've done a very brave thing here because I've gone against the order of the discussion in the very famous Responsive Regulation book by Ares and Brathwaite, and that's because I'm trying to break out and be a bit of an individual, but I also think it's easier to start with an example of delegated regulatory functions because I think it makes it easier to understand the richness of Responsive Regulation. So this is an example of regulatory delegation and the monitoring of that delegation. And it's a response to arguments that the costs and red tape and inflexibility of command and control is stifling initiative and stifling firm's ability to regulate themselves in response to their obligations, but it's also a response to the risks of leaving firms to regulate themselves. Everybody's very awkward with the fact that self-regulation may lead to intolerable laxity and failure by firms to comply with regulatory objectives, so you have this notion of self-regulation but enforced by the state. Now, how does this work? Firstly, the big idea is that the regulator and firms agree that firms will draft and then adhere to their own rules that meet the regulatory standards that the state would like to have met. So the firm, in a sense, is a self-regulator. The regulator indicates the standards that need to be met. They can do that either by setting a criteria or they can set default standards and indicate to firms that they can particularise those criteria or try and meet those default standards but in a different way or a better way. So the firm tailors rules to meet its own circumstances, so the rules will be different across firms but they will all be higher than the basic regulatory standard. And then the firm's responsibility is to monitor compliance with those rules and at the same time, if breaches are found, to deal with those breaches and to comply. What's the state's role? What's the regulator's role? The regulator's first role, of course, is to set the criteria, set the default standards. Its principal function after that is to approve the rules. So the rules need to be submitted to the regulator. The regulator can approve or can require amendments. The third thing that the state does is ensure that the process of self-monitoring by the firm is rigorous and done by an independent, at least there's some independence in that monitoring group. Where small firms are involved, the state may have to undertake most of the monitoring. It may be that small firms don't have the capacity to self-regulate in that sense. And of course, as enforced self-regulation suggests, the key role of the state is to enforce breaches of the rules where they are detected. Now, where do we find examples of those? Well, we find examples of enforced self-regulation right through work health and safety regulation. Probably the best and purest example is in relation to major hazard facilities under part 10 of the Work Health and Safety Regulation. And their major hazard facility operator must be licensed. And what do they have to do to be licensed? They have to introduce a safety case after consultation with their workers. And that safety case has to be submitted to the regulator and to be licensed. The safety case must be approved. So there's a classic case of enforced self-regulation as in breath weight style. Other examples are found in mining. For example, in New South Wales and Queensland under the mining health and safety legislation, mine operators are required to develop safety and health management systems in consultation with workers. Those systems are there to meet the requirements to reduce or to eliminate or at least minimise hazards as far as reasonably practicable. Those safety and health management systems are scrutinised, monitored, examined by safety, site safety and health representatives and industry health and safety representatives. Those are worker representatives and also scrutinised by inspectors whenever they visit workplaces. So you'll notice there's a slight difference in that model from the model that are posited earlier and that is that the inspectorate doesn't approve health and safety management systems but they're scrutinised closely by worker representatives and by the regulator. So the third example is actually to be found in the mainstream health and safety legislation. The Work Health and Safety Act in most jurisdictions and there section 19 in the harmonised legislation sets out a duty of care and the duty of care delegates management decisions about how to best manage health and safety to the person conducting the business or undertaking. So the regulator could have set out very detailed standards saying exactly what has to happen but the regulator recognises that it's better to leave to firms who know best their circumstances and who know best the hazards facing them in the industry to regulate themselves. So as most of you I hope will know section 19 requires PCB use to ensure the health and safety of their workers but it doesn't specify in detail how that has to be done. So it's up to the firm to work out ways of identifying hazards, setting the risks and then controlling those risks. Now that's a difficult job, most people will know that that's difficult to do so the state plays a secondary role in providing guidance in the form of regulations and in the form of codes of practice. And they indicate how particular hazards should be managed and what processes should be followed. But the PCBU doesn't do this alone, the PCBU has to manage health and safety in consultation with worker representatives, health and safety representatives and where a PCBU is involved in activity with other PCBUs has to manage health and safety in consultation with other PCBUs. And this is a classic example of enforced self-regulation, delegated responsibility to the firm but surveillance by a number of other parties including the state. So enforcement can take place here by health and safety representatives issuing a provision improvement notice or prohibition notice or by the state stepping in and using one of the enforcement methods that I'll discuss in a few moments when we talk about the enforcement permit. The fourth example of enforced self-regulation is the enforceable undertaking. This is an Australian invention first appearing in the trade practices and consumer area but now found in the model health and safety legislation in Part 11 of the Model Work Health and Safety Act. And essentially enforceable undertakings are promises made by the firm usually in a situation where the firm has committed a contravention of the legislation and is being investigated by the regulator. And if the promise or the undertaking is accepted by the regulator because it meets the regulator's criteria of an enforceable undertaking then the firm is committed to carry out whatever has been promised in the enforceable undertaking. And usually it's a bit more than just comply with the obligation that it contravened and you would hope that that would be the case. So often enforceable undertaking includes activities that involve the industry for the benefit of the particular industry so it could be developing training in industry, it could be developing a code of practice for the industry or model guidelines or something like that. And there are a whole raft of things that you can find in enforceable undertakings that you won't find that are beyond what a regulator can do because the enforceable undertaking can include things that don't fall within the regulator's powers. Now the beauty of the enforceable undertaking is that if the firm reaches the undertaking they can be prosecuted for the initial contravention and they can be prosecuted for failing to comply with their undertaking. Regulatory functions are delegated to the firm and when there's a breach of those functions the state can step in and enforce. So each of those four examples enables the firm to tailor its rules to its own circumstances and the implementation of those rules is monitored by the state in the form of the regulator but also in many circumstances by worker representatives, health and safety representatives. Okay, so that's the first example. Now there are a couple of issues that arise out of this and you'll have noticed that only in one of the instances I've given you does the regulator actually approve the rules. And that's because it's argued that that's a costly process and it takes a lot of regulator resources. Aeism Braithwaite in their optimistic way suggests that over time regulators will become more practised and skillful at this and will have to devote fewer resources but it's interesting that the only approvals we find in health and safety legislation are firstly in relation to major hazard facilities where the hazards are extremely high and secondly there are relatively few facilities and the other is in relation to enforceable undertakings where a firm has already contravened legislation so there has to be approval. But whatever the case is rules are being scrutinised by workers and their representatives and ultimately by the state. So let me move on to the second example and that's the example of the enforcement permit and this is a broader example or one example of the second principle I talked about earlier this notion of escalating state intervention in relation in a process of monitoring and checking on the activities of firms to whom regulatory tasks have been delegated. So the enforcement permit came about because of a very tired and longstanding debate between people who argued that the regulator's job in health and safety enforcement is to advise and persuade whenever a contravention was detected and those who argued that no it was a breach of law and therefore the state's role, the regulator's role was to step in and prosecute. And this debate's been going on since about 1833 in the UK and has been going on ever since the Australian legislation was introduced in the late 19th century, early 20th century and the problem with both of those approaches is that if you take the approach of excessive punishment if you reckon that every single contravention should be prosecuted what happens is that firms who are trying to do the right thing who are motivated to comply and breach legislation are likely to be demotivated, likely to become resistant to regulation because they feel they're on the right track and that the punishment is excessive if on the other hand you only advise and persuade the result can be intolerable laxity and low levels of compliance. Areson Braithwaite, particularly John Braithwaite noticed that really master regulators were adopting a different kind of approach and adopting the strengths of both of each of the advice approach and the punish approach to cover up the weaknesses of the other approaches. So what emerges is a regulatory dynamic which revolves around the notion of a hierarchy of sanctions or what we call as a pyramid. So the argument is that you'll get optimal compliance when you have an enforcement pyramid where you've got very strong sanctions at the top and more advice persuasive type sanctions at the bottom. And here's an example. This isn't actually a mainstream health and safety regulation but it's an example that John Braithwaite uses in a very good article in the 2011 University of British Columbia Law Review in relation to Transport Authority. And you'll see there on the left hand side is on the pyramid is an arrow showing the attitude to compliance. So at the bottom you've got firms that are fully compliant and at the top you've got a firm that's seriously engaged from the regulator. And if you look on the right hand side of the pyramid you'll see that the bottom, the firm, the regulator adopts strategies like maintaining awareness of health and safety, about educating, counselling and at the top are much stronger enforcement approaches like prosecution. And you'll see that each of those approaches is tailored to the compliance response on the other side. People watching this will probably be more familiar with the National Work Health and Safety Enforcement and Compliance Policy which is now on the PowerPoint. And at the top you'll see strong court sanctions at the bottom you'll see advice and persuasion methods which are labelled encouraging and assisting compliance and in the middle are sanctions or measures such as improvement notices, prohibition notices which are directing compliance. And the whole idea of the pyramid is that the regulator begins at the bottom assuming cooperation, assuming virtue but when this assumption is not met or alternatively when the firm exploits this cooperative strategy then the regulator escalates and adopts a stronger enforcement posture first using measures like improvement and prohibition notices but if that doesn't work escalating to higher enforcement approaches. So what are the key principles guiding the use of the pyramid? The first big idea is that optimal compliance that is cooperative compliance at the very bottom is most likely when the regulator displays an explicit enforcement pyramid with a wide range of enforcement options so that there are a wide range of possible responses to the compliance posture adopted by the firm. And it's important that there be a large number of enforcement measures because it's important that the regulator doesn't adopt the wrong approach so if there are a limited number of enforcement measures the regulator may find it difficult to choose the appropriate response which might lead either to lack of effect on the firm but worse by overshooting and demotivating the firm and leading to resistance. So that's why there needs to be a large number of very nuanced sanctions because otherwise the regulator is going to get it wrong and it's not going to have appropriate choices. The second big idea is that when does the regulator use these sanctions or how does the regulator decide? The regulator decides by being responsive to how effectively corporations or firms are regulating themselves. So whether or not to escalate depends on the compliance posture of the firm and how well in particular the firm is regulating itself and why do I use that term regulating itself because we saw from the earlier example that the health and safety legislation is largely about delegating regulatory functions to the firm. And the third big idea is that there's a real trick to responsive enforcement and there's a synergy between punishment and persuasion. So why does persuasion work? Persuasion will work because it's underwritten by the possibility of punishment. Why is punishment legitimate? Because it's legitimised by the underpinning posture of advice and persuasion and cooperation and the two work together in synergy. And writers like Nielsen and Parker have commented that the other beauty of the enforcement pyramid is that by leading firms into a more cooperative approach and a more compliant attitude you're more likely to get a long-term and sustainable compliance approach. You're more likely to get to a nice kind of equilibrium at the bottom of the pyramid where there's ongoing sustained compliance rather than a battle between the regulator and the firm. Now that's all fairly complicated but what makes it even more complicated is if you follow the development of responsive enforcement over time you'll see that in particular John Brathwaith's approach to responsive enforcement has changed really in line with his developing interest or highly developed interest in restorative justice. So those old timers like me who grew up reading the 1992 responsive regulation book with Ian Ayres would have noticed in chapter 2 that responsive enforcement is largely built around the notion of tit for tat and that comes out of game theories I mentioned earlier. Examining or theorising or modelling what happens when a regulator adopts a cooperative approach but the firm breaks away from cooperation and starts breaching legislation what's the ideal response of the firm? And the tit for tat argument is that the regulator starts with this assumption of virtue starts with a cooperative approach everything's fine if the firm is cooperative and complying but if the firm doesn't comply then the regulator escalates its response at the permit and as soon as the firm begins to comply then the regulator drops back again but if the firm doesn't comply and is fairly intransigent in non-compliance then the regulator escalates further but what you notice is that the regulator is watching closely what the firm does and is responding to the firm's approach to cooperation and to compliance and as Neilson and Parker point out that the regulator's approach in other words the level of formality it adopts and the level of coerciveness it adopts and by formality I mean how literally the regulator is interpreting the legal rule that's being complied with and how formal it is about compliance and coercive of course is the level of the hierarchy that the regulator is working at those are all matched to the firm's response at the previous stage of the tit-for-tat approach now the later restorative formulation is quite different what's crucial to know about tit-for-tat is that the it's important that the regulator and that the field staff involved in regulation threaten escalation as part of the transaction the later responsive restorative justice formulation involves the regulator that's the field staff the inspectors engaging face-to-face with duty holders making minimal use of formalistic and coercive approaches in other words they signal that they prefer to take a cooperative approach they signal that their preference is for capacity building and cooperation and they never threaten escalation that's a major difference in the restorative justice approach the field staff never threaten escalation they believe that cooperation kindness and respectfulness on their part leads to the same attitude on the part of the duty holder the firm and this leads to cooperation by the firm and better compliance and in fact where there is compliance there is a pyramid of rewards so at the bottom of the pyramid of rewards the regulator of firms the compliance supports it provides further education and can escalate to praise can escalate to positive recognition by spreading word of the approach that the firm has taken and at the very top of that pyramid of rewards can nominate the firm for a prize a health and safety award and so on the other crucial difference between the restorative justice approach and the tit for tat approach is that it's the legal system and the enforcement system itself that threatens the firm with punishment and escalation it's not the field staff dealing face to face with the firm so in a sense escalation sits further in the background than it would under the tit for tat model and in a sense the field staff are saying we're the good guys we're helping you comply if it doesn't work out others are going to take over and come over the top of us and the system itself will implement the more coercive and formalistic enforcement approaches now just two observations before I move on about the enforcement pyramid the first is as we've seen from the national compliance enforcement policy there does seem to be an enforcement hierarchy as part of the approach of most regulators and certainly if you map the aggregate statistics about enforcement you'll see that most enforcement activity is at the bottom of that pyramid and then the use of improvement of prohibition notices is slightly less than advice and persuasion activities at the bottom and prosecution and enforceable undertakings there are fewer in number than you find improvements in prohibition notices if you map that in the aggregate you actually do get a pyramid and that's used as justification for saying that Australian regulators do follow the enforcement pyramid and the thing with that is that empirically it's very rare to see genuine tit for tat in other words multi-transactional approaches to enforcement and as I'm going to foreshadow later one of the reasons for that is that most regulators just don't have the resources to play tit for tat with duty holders so I've in a sense labelled that response of enforcement light it's not quite tit for tat it's a sense of approach in the sense of adopting a proportional response to the level of compliance the second problem with the enforcement pyramid is a little more complex and that is that if you look at the enforcement statistics you'll see that prosecution is generally only taken where there's a serious injury or a fatality in other words when there's a serious injury or fatality the regulator jumps to the top of the pyramid when there isn't the regulator generally plays the bottom half of the pyramid might go up to an infringement notice or an improvement notice or a prohibition notice so in a sense the pyramid splits it stops halfway when there's not a serious injury or fatality and we go straight to the top when there is and I hope you'll see that one of the problems with that is that the regulator's not getting the full benefit of the pyramid because people know that the regulator won't go to the top of the pyramid and something really bad goes wrong ok so that's the more famous example of the pyramid let me move to the less famous example of the pyramid but equally interesting and that's the pyramid of regulatory strategies and again the key ideas here are regulatory delegation and escalating forms of government regulation but instead of it being pitched at the level of the firm it's pitched at the level of the entire industry and the idea is that governments would like their regulatory strategies to take place at the bottom of a pyramid of regulatory strategies where self-regulation is the key idea now why self-regulation good from a regulator's perspective well you don't need to draw up detailed rules you don't need to consult widely and what the codes of practice and the regulation should be and you don't have to spend a lot of money on enforcement staff you just leave it to firms to get on and deal with the broad principles and the broad objectives of regulation from a firm's perspective self-regulation is ideal because they don't have to spend money deciphering what the regulatory standard requires and instead they can get on determining their own approaches to compliance most of us are a little uneasy with that idea because we may not have the faith and belief in the intrinsic goodness of humankind to get on and comply with broad regulatory objectives so that's where the second idea comes in the idea of escalating government intervention so the if a regulator starts with the idea that self-regulation is the ideal approach it then indicates its willingness to escalate up the regulatory strategies permit of interventionism to stronger and more traditional forms of regulation so for example what you might find is within a particular industry self-regulation being the original approach but over time when there's clear non-compliance with the broad objectives of self-regulation the enforcement, the regulatory strategy moves up to enforced self-regulation if that doesn't work we move up the permit of regulatory strategies to command and control the notion I discussed earlier but with a discretionary approach so that the regulator can decide in particular instances whether to prosecute or whether to use less strategies but if that doesn't work we move up the permit of regulatory hierarchies to command and control with no discretion so the state has to prosecute you can play around with that permit you can use other approaches like licensing and taxing harm and so on but the idea, see the idea is fairly clear now of course in health and safety we're very reluctant to start at the bottom and in a sense to enforce self-regulation model but and the debate really is about how serious the sanction should be now that introduces the next important notion that underpins both of the pyramids that I've just discussed and this is the notion of the benign big gun and you'll find discussion of this in Chapter 2 of Ares and Braithwaith's book so at the heart of responsive regulation and particularly the two pyramids I've talked about the hierarchy of sanctions and the hierarchy of regulatory strategies is a paradox and the paradox is that the greater the image of invincibility of the regulator and the greater its capacity to escalate to the top of the hierarchy either of sanctions or of regulatory strategies and the tougher the sanctions at the top the more likely firms are or the industry in the case of strategies the more likely there is to be participation in cooperative compliance at the bottom so the tougher the sanctions at the top and the more likely it is that the regulator will move to the top of the pyramid the more likely it is that compliance will take place at the bottom so both hierarchies work best if they're tall and I've explained earlier what I mean by that but lots of sanctions a range of sanctions all carefully nuanced to different levels of compliance and if they're super punishments at the top now what's interesting about super punishments is most people will know that the model health and safety legislation now has its maximum penalty for a corporation three million dollars ten years ago in a book of essays John Braithwaith discussed restorative justice in health and safety and talked about restorative justice playing at the bottom of enforcement pyramid and at the top you have significant mega penalties and the kinds of penalties he was talking about were penalties of a hundred million dollars for contraventions but major discounts were a firm had a robust approach to systematic health and safety management so when we talk about large penalties at the top we're talking about significantly greater penalties that we currently find in the health and safety legislation okay time to move on to example four tripartism and to introduce this properly we need to move back to the original idea of civic republicanism and there were two key ideas that I was trying to get across at that point the one was in the sense of institutions checking on each other and counter balancing the exercise of power by other institutions this notion that there should be checks and balances in the system and institutions should have the power to check and to counter veil abuse of power by other parties and the second was participation of citizens two key ideas and these come together in Ares and Braithwaith's civic republican notion of tripartism and their argument is that so far we've discussed regulation as a game between two players we've talked almost exclusively about the regulator and the firm and tripartism as the name suggests introduces the third player in the regulatory game so a responsive regulation can be improved and capture and corruption prevented these are the two great fears in the model we've talked about capture is when the regulator gets a bit too close to the firm now we want the regulator to be close to the firm because we've talked about cooperation so in a sense cooperation is good capture what we're trying to prevent here is bad capture and corruption probably doesn't need much explanation so how do we check against capture or corruption and we do that by empowering public interest groups and we also do it by promoting collaboration, dialogue and trust building government where there's a system of checks and balances so the third party the private interests come into the regulatory game and check on the public regulatory approach taken by the public regulator and so this is Ares and Braithwaith's idea that private interests can be harnessed for the public good so public interest groups become fully fledged third player and can directly take action against the firm and can take action against the regulator where the regulator doesn't enforce or is corrupted or is harmfully captured so under the Ares and Braithwaith's tripartist model the public interest groups have access to all information that's available to the regulator they have a seat at the negotiation table when there are deals done between firms and regulators and they have the same capacity to sue or to bring prosecutions as the regulator does now that may sound like something from Pluto but let me give an example using the work health and safety statutes so in part five of the work health and safety the model work health and the harmonized work health and safety statutes you'll know that workers can elect worker health and safety representatives these representatives have a range of powers some of the powers include getting information about health and safety so there's a tick on the first on the first item there, the first tick secondly inspectors need to cooperate with health and safety representatives they have to consult with health and safety representatives and report to health and safety representatives the kinds of issues that they're finding at the workplace and thirdly health and safety representatives can issue provision improvement notices and can issue and can direct the dangerous work seats well they can except in my home state of Queensland in a sense ideally they would also have the right to prosecute people will know particularly New South Wales people will know that there is a very limited right for a trade union to a secretary to prosecute for a category one or a category two offence in New South Wales but it's a long and convoluted and very difficult to implement strategy but ideally we could have a private enforcement hierarchy if we had stronger sanctions at the top and a right to prosecute and that would be following the years in Brathwaite model that I've outlined here now the book response of regulation was written in 1992 and Peter Graboski a long time collaborator of John Brathwaite very recently wrote a very interesting article and where he talked about the way that the world has changed since since 1992 which will come as a shock to all of us many things have happened firstly there's been a weakening of the state regulatory activities partly because governments don't have the revenues that they used to have and there's great a call on their resources secondly some states might be some countries might be scared to antagonise capital and thirdly many governments don't have a philosophy of reducing government's invention so you can discern a trend for a weakening of state or withdrawal of the state from its regulatory activities the second development is there's been an increase in the number and the type of non-government actors in the regulatory process one example is the power of retailers large retailers establishing supply chains have extensive powers to control the quality of the product in the supply chain the use of resources in the supply chain and the use and the working conditions in the supply chain and in a sense this has been recognised in a number of areas of regulation but most most healthfully the clothing footwear and textile industry their regulatory provisions to try and harness the power of retailers and those high in the supply chain and requiring them to ensure health and safety and the payment of wages to workers at the bottom and the third development is developments in digital technology and the possibilities of what Roboski calls wiki regulation without government mediation so more and more private individuals using smart phones and using Google Earth and all sorts of things can monitor non-compliance by corporations and what's more frightening for we old people they can communicate very quickly with other people through social through social media and so it's very easy now to monitor prices in supermarkets it's very easy now to track where waste is being done it's very easy now to track animal cruelty in abattoirs all over the world and this has had a profound impact on the way that regulation can take place so in other words there's a radical increase in the types of private actors to whom regulatory activities can be delegated or who will in fact undertake regulatory activities even if those activities aren't delegated to them now that's a moment of optimism but we must always remember as many theorists point out that we shouldn't get too excited about the possibility of private actors not being involved in regulatory failure we're all sceptical about governments and regulation but commentators warn us or not to get too carried away with private regulation and the possibility of private regulatory failures is always is always good but it is worth thinking about in discussions about responsive regulation ways of harnessing players outside the players that we've traditionally considered in health and safety and let me just end with discussion of the potential difficulties of responsive regulation and these difficulties really the ones I'm going to raise are really in relation to the enforcement permit and one we've already touched on do regulators have enough resources to work their way up and down the permit and I'll leave that as a question but in a sense we answered that earlier the second is just more of a conceptual issue or skills issue for responsive enforcement to work really well you need a regulator that's able to determine the compliance posture of the firm really understands systematic approaches to health and safety management really understands compliance programs and so on and that of course is a tall order that's in no way belittling the qualities of health and safety inspectors it's just saying it's a really difficult job and you also need firms that are able to pick up signals from regulators and fully understand what a regulator is doing and in a recent publication has noted ambivalence and ambiguity characterises most regulatory transactions and so there's not always the clarity of communication and the other problem with big firms of course big organisations is who's the regulator communicating with and is that communication getting to the key decision makers in the firm critics on the left are very skeptical about the capacity of business organisations to put concerns for health and safety ahead of concerns for profitability and production people like Steve Terms and Dave White are very skeptical about the presumption of virtue and starting at the bottom of the pyramid and the same authors and others argue that particularly when you look at the UK experience of enforcement there's a clear trend to reduce enforcement resources and there's a clear trend to reduce enforcement activity and this coupled with risk based strategies feeds easily into debates about responsive regulation but leaning a bit too closely to the advice and persuade and the bottom of the pyramid activity rather than the top so there are risks of in a sense responsive regulation being captured by more conservative debates and debates where enforcement doesn't take such a high priority so let me conclude there the points I've been trying to make is that responsive regulation is developed in response to clear weaknesses in the command control model that responsive regulation provides really exciting opportunities for very smart regulation for nuanced regulation but of course they're great dangers from lack of resources and also because of the inherent problem in health and safety of a conflict between health and safety and production and profit but thank you very much for attending