The outcomes of the Commission’s ‘one in, one out’ pilot
Since the von der Leyen Commission in 2019 announced its intentions to revamp the EU Better Regulation Agenda through a 'one in, one out' (OIOO) approach, the ETUC has expressed its strong criticism. In 2020, the ETUC adopted a Resolution on Better Regulation for All, setting out a more positive narrative to EU law-making. Many of the ETUC concerns raised against the OIOO have later also been echoed by the European Parliament in its 2022 Resolution on Better Regulation: Joining Forces to Make Better Laws.
The ETUC sees the OIOO as reductionist approach to law-making and impact assessments, framing regulation as a mere burden and cost. The ETUC advocates for a stronger focus on quality legislation that delivers in the general interest as a medium to long-term investment. Business interests alone cannot be put on an equal footing with the general interest, which also includes the interests of workers, citizens, consumers and the environment. Mainstreaming the sustainable development goals in EU law-making requires economic, social and environmental aspects to be considered with the same level of importance, detail and accuracy.
The Commission's OIOO approach was rolled out through its 2021 Communication on Better Regulation, and further defined in its updated Guidelines and Toolbox on Better Regulation. During the second half of 2021, the Commission conducted a pilot whereby a OIOO calculator was operationalised in the impact assessments up 10 legislative proposals. The outcomes of this pilot have since been presented in the Commission's Annual Burden Survey for 2021.
On 8 September 2022, the ETUC was invited by the European Parliament Research Service to discuss the implementation of the OIOO at its First Annual Conference on Better Law-making: Forward Looking Policy-making in Times of Multiple Crises. In the views of the ETUC, the pilot outcomes largely confirm the criticism already raised against the Commission's new Better Regulation approach:
While the ETUC advocates for more qualitative considerations in EU law-making, the OIOO seems to have pushed the Commission towards an even more reductionist approach. The Annual Burden Survey e.g. highlights “changing practices towards increased quantification”.
The ETUC considers the Commission’s approach to be far from objective or scientific. E.g. the OIOO calculator does not consider “costs and savings for national, local and regional authorities”. The Survey also explains that estimates of adjustment and administrative costs are “simply assigned to the base year in which the proposal is adopted by the Commission". Similarly, the estimated costs “relate only to the Commission proposal, not to the final EU regulation adopted” nor depending on “how Member States transpose, implement and enforce it”. Still, this is only natural, since law-making is not a scientific exercise, but a democratic process. As such, the very nature of EU law also allows Member States to even go beyond any established minimum standards.
For the ETUC, quality regulation is an investment for the future, whereas it is clear that the OIOO merely focusses on short term burdens and costs. The Survey acknowledges this focus “on costs that in most cases can be estimated”, thereby favouring economic considerations over social and environmental ones. As a consequence, “quantifying benefits has generally been harder”, the Survey admits. However, it does not reflect any further on how this impacts the overall assessments or what could be done to remedy these shortcomings. Benefits that cannot be monetised, e.g. when it comes to well-being or sustainable development, simply seem not to taken into account, and especially not the long-term ones. Such an econometric methodology unavoidably prioritises business interest over others.
Regulation can of course bring economic benefits, but also social and environmental ones.
Conversely, also non-action or a lack of enforcement can result in particularly high social and environmental cost, or even unfair competition among business. All this support the ETUC view that the OIOO is not an appropriate tool for the elaboration of EU law. It reduces EU regulation to a book-keeping exercise, as if democratic law-making was a zero-sum game. Following the OIOO logic, one could e.g. ask whether compliance costs of business should be taken into consideration even when a legislative initiative serves to tackle unfair competition and abusive business models?
Finally, also the in-built flexibility of the OIOO seems to cover up its flawed approach. According to the Commission, a legislative initiative could be “exempt from the OIOO e.g. in emerging areas, where it is necessary to fill a regulatory gap.” Such an approach gives the impression that there would be some kind of baseline or upper limit to EU acquis within any given policy area. This appears to be completely at odds with the fundamental EU objectives of social progress and an ever-closer Union.
All in all, to deliver on EU flagship initiatives such as the Green Deal, the European Pillar of Social Rights and the Sustainable Development Goals, the ETUC strongly believes that we need ambitious investments both in terms of resources and quality legislation.