Improving Regulatory Systems

Recommendations and Actions

Description of the Executive Order on Regulatory Reform

On January 21, 1993, President Clinton abolished the Council on Competitiveness and soon thereafter asked the Vice President to prepare recommendations for a new process of regulatory review. The Vice President convened an informal working group to develop such recommendations. The President will soon issue a new executive order to implement the needed reforms recommended by the Vice President.

President Clinton's plan to reform the regulatory review process is firmly rooted in his commitment to make government more efficient and responsive, relieve businesses of unnecessary regulatory burdens, and end special access for special interests.

The executive order on regulatory planning and review will create a process that guarantees that government regulates only when necessary, and that when it does so, it regulates cost-effectively, openly, and fairly. It also will ensure that all agencies of the federal government participate in a reexamination, across agencies, of the overall regulatory scheme currently in place to eliminate any unnecessary regulatory burden.

Putting People First

The President's plan provides a regulatory process that works for the American people, not against them--one fundamentally dedicated to improving their health, safety, environment, and well-being while encouraging economic growth and job creation. It is aimed at producing regulations that are effective, consistent, and understandable.

Regulating Only When Necessary

The process created by the executive order sets forth principles that ensure that agencies regulate only when necessary. It makes clear that alternatives, such as market incentives, are preferable to command- and-control regulations. A regulatory working group of representatives from agencies with major domestic regulatory responsibility will meet regularly to consider new, creative, and more effective alternatives and approaches to regulating.

When regulations are necessary, the order will ensure that they are designed and implemented in the most cost-effective manner, so as to maximize benefits to society and to place the smallest possible burden on those being regulated. This process imposes a sensible, balanced definition of costs and benefits to ensure a realistic assessment of impacts on the economy, the environment, and public health and safety.

Sensible Planning

The executive order creates an enhanced planning process that starts before rules are formally initiated. This process will provide early guidance about administration priorities, thus minimizing conflicts and inconsistent regulatory activities among agencies. Agencies will set priorities and assemble annual regulatory plans, thereby improving their own internal planning, and ensure that other agencies and the public are informed of their activities.

Reviewing New Regulations

This executive order recognizes the primacy of agencies in the regulatory process. It also makes clear that the Office of Information and Regulatory Affairs (OIRA), within the Office of Management and Budget, will be the day-to-day entity responsible for necessary centralized review.

The centralized review process will be improved by selectively reviewing regulations. Under the review process, OIRA will review significant regulations--not every regulation. Its review will be more useful and realistic because it will be focused on the overall regulatory picture and will consider a broad definition of costs and benefits. And its review will be timely--driven by clear and appropriate time limits on review that will prevent interminable delays. There also will be a clear process for resolving the rare regulatory disputes that develop between agencies or between OMB and an agency. Such disputes will be reviewed by the President only at the request of an agency head or the Office of Management and Budget. The Vice President, aided by appropriate White House policy advisors, will advise the President in resolving these disputes.

Reviewing Existing Regulations

Too often, cumulative and unnecessary regulatory burdens hamper economic growth and job creation. In order to ease such adverse effects on U.S. citizens and the economy, a process will be established to conduct an ongoing review of existing regulations or groups of regulations. Those regulations that are cumulative, obsolete, duplicative, or inconsistent will be identified for reconsideration and revision or elimination.

This process is carefully structured to be meaningful and to get results. The agencies will be asked to prepare a specific program for ongoing review of existing significant regulations and legislation that requires regulations that should be reviewed. In addition, the Vice President, in consultation with the White House advisors, will conduct reviews of existing regulations with a cross-agency perspective, and may identify regulations to the agency for review.

Enhanced Accountability

The executive order also will enhance government accountability in a number of ways. It will clearly delineate the responsibilities of the various entities involved in the regulatory review process. The OIRA review process will be conducted in the "sunshine."

The order requires public disclosure of OIRA meetings with, or information received from, outside parties. It also ensures that the public knows of the status of all pending regulations and changes made to regulations during the OIRA review process.

The process created by the new order also will end the "back door" special interest access to the review process. The order makes clear that the President's and Vice President's roles in the review process is limited to (1) providing leadership, (2) assisting in planning, and (3) resolving disputes. They will not act on behalf of, or be the conduit for, special interests or any private parties.

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