A4-0413/96

Resolution on the strengthening of the impact assessment system

The European Parliament,

- having regard to the motion for a resolution by Mr Mather on the strengthening of the business impact assessment system, B4-0120/96,

- having regard to Rule 45 of its Rules of Procedure,

- having regard to the 1986 Commission internal regulation on the establishment of the business impact assessment system,

- having regard to the Commission decision of 8 November 1989 to strengthen the impact assessment requirements for legislation which has a significant impact on the economy, employment, environment, social aspects and society at large,

- having regard to its resolution of 24 October 1994 on the Commission communication on the implementation of an integrated programme in favour of SMEs and the craft sector ((OJ C 323, 21.11.1994, p. 19.)),

- having regard to Declaration 18 attached to the EC Treaty which notes the Commission undertakes, by basing itself where appropriate on any consultations necessary and by strengthening its system for evaluating Community legislation, to take account in its legislative proposals of costs and benefits to the Member States public authorities and all parties concerned,

- having regard to Article 118a(2) of the EC Treaty which states, referring to directives on health and safety of workers, that 'such directives shall avoid imposing administrative, financial and legal constraints in a way which would hold back the creation and development of small and medium-sized undertakings¨,

- having regard to the Commission report on the Coordination of Activities in Favour of SMEs and the Craft Sector (COM(95)0362),

- having regard to the Commission proposal for a third multiannual programme for SMEs ((OJ C 156, 31.5.1996, p. 5.)),

- having regard to the report of the Committee on Economic and Monetary Affairs and Industrial Policy and the opinions of the Committee on Employment and Social Affairs and the Committee on the Environment, Public Health and Consumer Protection (A4-0413/96),

A. whereas it is necessary to understand the costs and benefits for all sectors of the economy and society of European legislation in order to make an informed decision on adopting such legislation; whereas plain, unambiguous Community legislation is easy for businesses to implement and simple for the authorities to monitor,

B. whereas the social protection of workers should be a priority within the European Union,

C. whereas the European Union must maintain a competitive position in global markets while maintaining the high levels of environmental and social protection embodied in the ¨acquis communautaire' and giving careful consideration to legislation which may damage competitiveness,

D. whereas the group which is most vulnerable to the costs of European legislation is small and medium enterprises which constitute most of the employment and economic growth in Europe,

E. whereas the Commission's current system of evaluating the effects of legislation and regulation on business does not require detailed analysis of costs and benefit; whereas a careful impact assessment can be a valuable tool in the effort towards better legislation, and more specifically can fulfil a threefold role:

- by offering an opportunity to justify the proposed measure, thus making it more acceptable to those concerned,

- by playing an awareness-raising and informative role for the policy-makers,

- by contributing to the predictability of the policy,

F. whereas the present impact assessment system is unsatisfactory and whereas the Commission must tighten up its relevant internal rules,

G. whereas, with reference to Article 118a, the Commission's current system is not implemented systematically, i.e. not to every proposal for Community legislation expected to have a major impact on the economy, employment, social aspects and society at large,

H. whereas a systematic and comprehensive estimation of costs and benefits, in consultation with the social partners, SMEs and other interested parties will contribute to an effective review of proposals which could have a substantial impact on the economy, employment, social aspects and society at large,

I. whereas an impact assessment summarizing the advantages of the relevant legislative proposal for industry could demonstrate the effectiveness of legislation,

J. whereas an enumeration of benefits would also assist in developing well- constructed legislation,

K. whereas the impact assessment system must not become so bureaucratic that it inhibits the European Union's ambition to simplify present legislation and enact clear and simple legislation in the future to ensure that the Single Market works successfully,

L. whereas impact assessments, even when based on the same methodology which may not be acceptable to all Member States, sectors of activity, types of business and organisations or individuals, may produce results which show for the same type of legislation a positive effect on one Member State and a negative effect on others,

1. Calls on the Commisison to examine how it could develop an appropriate and rational approach for impact assessments, not only for business but also for health and safety, environment and employment, and to submit an appropriate report for consideration by the Council and European Parliament;

2. Expresses its view that a meaningful impact assessment should accompany every legislative proposal which, directly or indirectly, has the effect of increasing costs for a large number of small businesses;

3. Calls on the Commission to give the impact assessment system an official and legal standing within the framework of Community legislation, with subsequent changes to the system requiring the opinion of Parliament and the Council;

Institutional responsibilities

4. Calls for the appropriate Commission Directorate-General drafting the legislation to consult the Directorate-General for Enterprise Policy when an impact assessment is prepared if the proposed legislation could have a substantial effect on small and medium sized enterprises;

Notification of an impact assessment and timing

5. Proposes that the impact assessment should appear at the end of every Community legislative proposal expected to have a significant impact on business and be distributed to Parliament, the Council and other European institutions; it should also be available to the public at large (citizens, businesses, and governments) through the Official Journal; a standard format should be adopted so that the impact assessment is easily identifiable (Bullock);

6. Urges the Commission, prior to deciding whether to legislate or not, to provide a scaled-down impact assessment as to the likely effects of any regulation;

7. Insists that all interest groups concerned should have an opportunity, both at the draft stage and on final approval of the impact assessment, under the supervision of DG XXIII, of holding consultations with the DG responsible for the legislative proposal; DG XXIII should take care to ensure that the DG responsible for the legislative proposal provides the professional business organizations and individual businesses concerned which so desire with full information enabling them to estimate the impact the legislative proposal will have on their cost structure;

8. Requires that no Commission proposal, selected for an impact asessment by the Commission or other groups, should be presented to the College of Commissioners for vote without an approved impact assessment (approved by the Secretariat- General and with a Commissioner's signature); if subsequent amendments by Parliament or the Council would significantly change the scope of the regulation, the Commission would have to produce an updated impact assessment after the Council has reached a common position after first reading;

9. Insists that all existing legislative texts must require, after a designated time in force, an impact assessment review to help determine any unforeseen impact on business; if costs or benefits were severely underestimated, business should be able to appeal to the Commission for a review of the legislation at any time; such a review should state why the costs or benefits to business were underestimated and list possible measures to reduce those costs or increase the benefits;

Role of the European Parliament and other matters

10. Insists that, to improve Parliament's ability to control the amounts of legislation, each rapporteur should, at the start of consideration of any legislation, report to Parliament on the impact assessment of the proposal in question to ensure that costs and benefits are properly discussed; recognizes that the impact assessment can provide necessary and particularly useful information for determining Parliament's viewpoint, and expresses the hope that when debating a legislative proposal Parliament will henceforth consider the impact assessment as an integral part of the proposal;

11. Calls on the Commission to examine how the development of an impact assessment can be properly financed;

12. Proposes that, following the implementation of a strengthened impact assessment system, a review of the system and discussion of possible changes should take place five years after the implementation date;

13. Welcomes in this respect the Commission's intention, as set out in the proposal for the review of the fifth environment action programme, to pay particular attention to ¨further developing the use of economic evaluation techniques for the environment (cost effectiveness, cost/benefit and business impact techniques)' (Part 2, Article 7 in COM(95) 0647);

14. Instructs its President to forward this resolution to the Commission, the Council, and the Parliaments of the Member States.