Figure 2.1. Regulatory integrity, independence and the institutional form 1 1.Supporting mechanisms include the regulator having direct control of its staff through employment, or alternatively via a Framework Agreement with the head of a Ministry and Minister provisions that affect the regulator’s tenure explicit restrictions on direction funding arrangements, etc. Regulatory integrity is linked to achieving better outcomes. Some regulators who operate in rapidly changing regulatory environments have to be adaptable to responding to the varying situation. This is effectively managed through having the trust of the regulated entities in the decisions and interventions that the regulator makes. Decisions on the extent of independence required will depend on what is being regulated, judgement about how that is best regulated and whether a particular institutional form best fits the nature of the regulator’s activities. For some types of regulatory decisions, the trust of regulated entities and the wider public is best engendered by demonstrating that these decisions are shielded from perceptions of political influence (Christensen and Laegreid, 2006; Meloni, 2010). In some cases it will be clear that a legally independent and structurally separate regulatory body is needed, while in others it will be a matter of judgement. Factors to consider are set out in Table 2.1.
