New policy to lay down norms for sector watchdogs in works

NEW DELHI: Regulation of regulators is the next big item on the UPA government���s reforms agenda. The government is working on a policy that will govern all regulatory organisations, such as Sebi, Trai and IRDA. The ���mother of all regulatory policies��� would lay down the government���s regulatory philosophy, apart from functions, structure and powers of various regulators.

The policy will pave the way for the establishment of multi-sector regulators. The Planning Commission is drafting the details in consultation with other government departments. Unlike Sebi or IRDA, multi-sector regulators would cover more than one sector and this could result, for example, in the entire transport sector ��� roads, ports and airports ��� being governed by one regulatory agency.

All regulators, existing or proposed, would have to converge with the overall regulatory philosophy of the government once the new policy is formulated. As of now, various regulatory authorities are being set up with specific needs of the concerned sector in mind rather than a common philosophy. This piecemeal approach would give way to an universal foundation for regulators when the proposed policy takes shape.

According to government sources, this over-arching regulatory philosophy is being prepared in accordance with the National Common Minimum Programme (NCMP) of the UPA. A policy note in this regard is being prepared by the Planning Commission and is likely to be finalised shortly for consideration by the government, they said. The guiding principle of this comprehensive policy will be: ���Competition where possible, regulation where necessary���.

The policy is being prepared to protect the interests of consumers. It is expected to strengthen all regulatory institutions. The policy would detail, among other things, the functions and powers of various regulatory commissions. It will also specify the terms and selection criteria of members and heads of various watchdogs.

Another important idea that has been put forward is the creation of multi-sector regulators. ���The Planning Commission is of the view that it would be better to set up multi-sector regulators instead of allowing a proliferation of regulatory commissions,��� the source added. For example, the Tariff Authority for Major Ports, a statutory body that determines tariffs for ports, could also be assigned the task to set airport tariffs or toll tax for roads, the commission feels.