The Logic of Red Tape

The government has announced its intention to launch an assault on 'red tape'. This is a laudable aim that I, as a manager in the (quasi) public sector can only applaud. Yet, I harbour sincere doubts as to its achievability which I will rehearse below.

Of course, policy makers make policy. It is what they do. Creative energy is rewarded more than passivity and there are plenty of wrongs to be righted and abuses to be curbed. So, it takes determination to hold back the natural rise in regulation and only very well disciplined policy makers can achieve this.

I would speculate therefore that the volume of regulation, and its sister - pseudo-regulation - the body of codes of practice, recommendations and official reports, will continue to increase. This increase does not however account for the disproportionate burden that weighs down managers. This can only be accounted for by understanding the logic of red tape.

To exemplify this logic let us take a particular societal problem. Let us then summon up the political will to do something about the problem and make some law and associated regulation. Inevitably, and as equity demands, these will impose requirements upon 'the just and the unjust alike'. Let us imagine a relatively straightforward set of such requirements, perhaps to report on the situation with respect to a set of agreed benchmarks and, where there is a gap between the aspiration and the achievement, to devise and deliver a strategy, under pain of administrative sanctions, intended to address it. It is reasonable to imagine that such steps go some way towards addressing the problem. From the policy perspective the requirements appears to be proportionate and not overly burdensome. At this point then, the policy maker leaves the stage.

Now the scene changes. Imagine we are charged with the managerial responsibility for implementation. What do the legislated requirements imply? Let us start simply with a data collection regime. Clearly, we need to put in place the information systems that are necessary to deliver this. We will need data quality standards and a process for assuring ourselves that these data quality standards are being adhered to. Probably we will want a process in place, internally, to address data collection shortcomings. We will need some mechanism for managerial oversight and review and, probably, a framework for addressing the risks inherent in failing to meet data collection obligations. None of these steps are difficult for a well managed organisation ... but we are not yet finished.

Consider for a moment the benchmarks. Which benchmarks apply in our situation? How are the benchmarks constructed and how precisely do they relate to our data collection and data quality standards? The benchmarks will need to be subject to internal review. We will need internal performance targets, and these will have to be monitored. We will probably want to examine our performance relative to others, particularly those in a similar situation. To support this it might make sense to contribute to a separate scheme of data collection and analysis to allow sectoral comparisons outside the mandatory scheme.

Obviously we are not finished. Let us assume that, in order for the policy objective to be met, the goals to be achieved are stretching ones. Otherwise, why have the regulation at all? We will need to draft a strategy to address performance deficits. It might make sense to have a strategy even if you are in compliance, 'just in case' and to demonstrate good practice. It will have to be reviewed, promulgated, regularly updated. It will need to be scrutinised to ensure strict administrative consistency with the regulations.  We will need to test elements of the strategy and establish a scheme of managerial controls for feedback on the strategy as it is implemented and to ensure adherence to the strategy. All of this before we have actually taken any steps towards implementation let alone rolling the strategy forward.

Putting to one side the desire to support the policy goals, the cost of failure to comply is very large, not simply the sanction but more the associated reputational damage, both corporate and individual, with the biggest risk being the loss of time and impetus handling a failure.

The point is, I think, made, though I could elaborate further. This is the logic of red tape. Simple things are not simple to achieve in large organisations. The coordination and governance overheads are simply too large with risk aversion amplifying them. The best intentions go awry. Time, resources and managerial attention are limited resources; efficiency gains are usually marginal, so some other worthy objective has to give.

As you will have gathered, I do not have much faith in the ability of government to hold back the tide, let alone to make it recede. The logic of red tape can also not be escaped. So, what is the alternative? Perhaps, 'smart policy' or policy that is 'managerially conscious' (you can see I am struggling for words here): policy making in which as much attention is paid to the means by which the subjects, who seek to comply, will meet the obligations placed upon them, as to the political strategy and the intended effects of the policy. This surely is achievable.