A recent report on harmonisation in the Australian rail industry (BTRE 2006) notes the difficulty of balancing the benefits of uniformity with customised arrangements for localised operations. The report notes that in complex technical systems like railways, with a relatively small number of operators, the potential for regulators to adopt customised systems is far more likely. Combine this with the Australian federal structure of decision-making and the potential for achieving uniformity in some areas of regulation become almost impossible. In fact the report states:
The regulatory track record in Australia in the last decade is one of regulatory instability. Since the establishment of State regulatory bodies in the 1990s, the regulators have sought to maintain consistency. Despite the signing of intergovernmental agreements on ‘rail safety’ and on ‘rail operational uniformity’ (in 1996 and 1999, respectively), jurisdictional safety regulators continued to develop safety regulations on an individual basis. Regulatory systems diverged from the outset (BTRE 2006: XXV).
Failure to achieve uniformity however, is not all bad news. Developments in regulatory techniques and compliance technology now mean that jurisdictions are developing the capacity to manage and regulate for variable standards of performance within similar industries. The focus of regulatory enforcement is moving away from prescriptive rules to outcomes and performance-based standards. Innovation in approaches to regulation requires both the industry and government agencies to have an informed understanding of regulation and greater capability to work within complex regulatory regimes. How do we get such regulatory innovation to prosper in a climate of reform that remains focussed on the rhetoric of deregulation, red tape reduction and a preference for simple prescriptive consistency?