The Jean Monnet Program



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a) Executive oversight


The proliferation of supervision mechanisms is a recent phenomenon, even in the United States. It dates from the 1970s, when a series of agencies were set up in the health, safety and environment fields. It was in these fields in particular that it became urgent to determine whether the agencies were effectively meeting the social needs for which they were set up and whether their operating costs were in line with the results achieved. The trend became particularly marked under the Reagan administration and resulted in 1981 in the enactment of a first Executive Order 12291,194 reflecting the President's determination to take control of these overactive administrative bodies on the pretext of curbing measures that were economically unjustified. What is more interesting is the adoption of a second Executive Order 12498, in January 1985, establishing the powerful Office of Management and Budget (OMB) under the President and giving it responsibility for the executive oversight of the agencies. Its tasks also include supervision and coordination of the entire regulatory work of the agencies. It is worth giving a brief description of the OMB's modus operandi.195

The OMB intervenes at three stages:

First, it has the right to review the regulatory programme of the agencies for information purposes and in order to identify any duplication in the work of different agencies, as well as to assess which regulatory projects are particularly contested or contain potentially dangerous elements.

Next, the OMB receives the Regulatory Impact Analysis (RIA), in which the agency has to assess the costs of each regulation proposed (including the indirect costs of regulatory activity), demonstrating that they are less than the expected direct and indirect benefits. The OMB has sixty days in which to respond. In the vast majority of cases, the plans are accepted without amendment; in some cases, the OMB negotiates improvements to the proposed regulation with the agency; in very exceptional cases, the plan is rejected as being particularly undesirable, and the agency has to review the proposal and either re‑submit or withdraw it. It can also refer the matter to the President or Vice‑President if the latter has express authority to deal with it, but appeals of this type are rare. It should be pointed out that, at this stage, proceedings are not public, the OMB and the agency negotiating behind closed doors.

Finally, having received the go‑ahead from the OMB, the agency has to send the Notice of Proposed Rulemaking (NPRM) to the Federal Register.196 The proposal is published there with all the supporting material and is opened to public debate. During a period of between 30 and 90 days, depending on the circumstances, any interested party may submit comments. The agency decides at its discretion what response to make to these comments, but it must take express account of them in its final decision, or face action before the courts for procedural defect. Once the deadline has passed, the agency must finalise its proposal and submit it again to the OMB thirty days prior to its publication as a final regulation in the Official Gazette. The OMB has only one month in which to carry out the final examination of the texts and the underlying economic analysis. It is extremely rare for it to raise objections at this late stage in the procedure. In general, the OMB first endeavours to and does obtain from the agency a very detailed explanation of the reasons for the instrument and the specific improvements to certain points, and more frequently, involving alternative and less costly ways of ensuring compliance with the rules enacted.

It is tempting to think that a similar office with the same powers as the OMB could very easily operate within the Central Audit Service already attached directly to the Commission's President.






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