Regulators in the 21^st century must take into account a new set of realities, such as the multiplication of governance sites and actors (e.g., international organizations, business or industry groups), increased occurrence of litigation, the limitations of government-centered regulatory action, the pressures from industry to have more flexibility to meet regulatory objectives, the demands of citizens to better protect health and safety and the demands of the public and industry groups to have more say in what governments do and how they do it. Over the years, these emerging realities have exerted greater pressure on traditional regulatory action.

There is a wide array of tools that the government can use when regulating. But theory, practice and case studies have shown that the best means to achieve public policy objectives is to use a mix of instruments and to let the affected parties play a role in the regulatory strategy.

The federal government has recognized, as per a number of initiatives, the benefits of moving toward a more systematic approach in choosing the right mix of instruments to achieve policy objectives and the need to work more systematically with non-governmental actors in pursuing those objectives.

The Committee believes that the use of instruments that foster cooperative approaches and that truly engage non-state actors should be increased and that a modern approach to "instrument choice or packaging" is a crucial component of a Smart Regulation strategy.

As of late, the use of non-legal instruments, such as voluntary codes, self-regulation, standards and economic instruments, is increasing at the federal level, but consideration of the full array of policy instruments in the course of policy making is still not done on a systematic basis.  Unfortunately, this means that Canada does not reap the full benefits associated with these measures. One of the areas of interest to the Committee is how economic instruments can be used in this country to advance sustainable development objectives.

A lot of work that has been done within the federal government to gain a better understanding of the benefits relating to instrument packaging and to disseminate information on the various instruments throughout the government. But the challenge appears to reside in the implementation of a governmental approach respecting instrument choice and packaging and in moving toward a more systematic consideration of the full range of available instruments.

Areas for discussion:

The Committee is interested in getting you views on how to make this happen and invites you to consider the following questions or to submit your own ideas on how to implement a government-wide strategy respecting the selection of instruments for government action.

How could the government move toward a more systematic approach in terms of choosing the most appropriate mix of policy instruments to achieve policy objectives? What would be the most important elements of such an approach?

To what extent, and under what circumstances, should a variety of instruments be used? What about "performance" or "outcome-based" regulations? What about self-regulation?

What approach should the government adopt with respect to the use of economic instruments? What criteria should be used to guide their use?

How should the government involve actors from outside government when using different instruments?

How does the use of non-traditional instruments affect the roles and responsibilities of businesses and citizens?

Background Material

The EACSR has commissioned a number of external advisory opinions and papers that will be made available through this web site for public review and comment. All such opinions remain those of the individual authors and do not reflect the position of the Government of Canada.

• Economic Instruments for Promoting Sustainable Development
  - National Round Table on the Environment and the Economy
• Economic Instruments for Environmental Protection and Conservation: Lessons for Canada
  - Stratos Inc.