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“Smart Regulation”

The Evolution and the Politics behind the German and European Efforts to Promote Better, Fair and Democratic Regulation

On 3 March 2014, Dr. Johannes Ludewig, Chairman of the German National Regulatory Control Council (NKR) at the Federal Chancellor's Office in Berlin and Member of the EU High Level Group on Administrative Burdens, gave a lecture on “Smart Regulation” at the Hebrew University of Jerusalem – a subject on which he had held discussions with representatives of the Israeli parliament and the legal service of the Knesset earlier on the same day.

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Following welcoming remarks by Prof. David Levi-Faur of the faculty of political science and Michael Mertes, head of the Israel office of the Konrad-Adenauer-Stiftung, Dr. Ludewig began his presentation by outlining the NKR's tasks and responsibilities. The NKR is an independent supervisory body that monitors legislative initiatives introduced by the Federal Government with regards to cutting red tape and reducing administrative costs. The expertise given by the NKR is based on the Standard Cost Model. Through this model the NKR identifies potential reduction of costs which are primarily caused by information requirements imposed by the Federal Government. These costs affect companies in particular and, to a lesser extent, civil society.

Since the 1980s studies and different approaches towards red tape reduction have existed in Germany. But the Netherlands serve as a role model for systematic “Smart Regulation” which the Federal Government has implemented in Germany in 2006. Since then, the expertise given by the NKR must be considered in the context of legislative processes. Thus, administrative costs in Germany have decreased by around 25% since 2006.

At the end of his presentation, Dr. Ludewig stood ready to answer the numerous questions of those present from science and economy. The audience showed particular interest in the areas in which bureaucracy costs turn out the highest (financial market regulation and energy policy) as well as in the difference between approaches towards “Smart Regulation” in Germany and at EU-level.

Finally, Dr. Ludewig spoke about the agenda for 2014. He concluded by underlining that much has indeed been achieved by the NKR, but there is still considerable potential for additional cost-effective improvements, especially with regards to implementing “Smart Regulation” on regional (Länder) level in Germany.

Stefanie Friese

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