Joe Carey (Clare, Fine Gael)
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Question 21: To ask the Minister for Communications, Energy and Natural Resources his plans to merge utilities regulators; and if he will make a statement on the matter. [44822/10]

Eamon Ryan (Dublin South, Green Party)
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There are three utility regulators currently operating under the aegis of my Department. These are the Commission for Energy Regulation (CER), the Commission for Communications Regulation (ComReg) and the Broadcasting Authority of Ireland (BAI). The structure of regulatory institutions can be an important, but is rarely a decisive, criterion for regulatory effectiveness. There is a far closer relationship between regulatory structure and both regulatory efficiency and consistency across sectors.

The main rationale for a decision to merge regulators is to improve regulatory decision-making and/or regulatory cost-effectiveness. The prospect of that happening will be heavily influenced by the scale of commonality across regulatory bodies together with the scale of embedded inefficiencies in the pre-existing structure.

At the outset of the establishment of independent economic regulatory structures in Ireland in the mid to late 1990s, the Government chose to adopt a structural model of single purpose organisations, generally headed by a single regulator. Over time, regulatory structure has moved to a multi-purpose organisational structure headed by multi-person commissions. This has been done by grafting new functions onto existing regulatory bodies rather than establishing new agencies. In the case of my own Department, the process of integrating new functions and deploying multi person or commission-based decision-making structures has taken place in both the case of CER and ComReg. The BAI, which has had a commission structure from the outset, has taken over regulatory responsibilities for regulation of important aspects of public service broadcasting.

Speaking generally, I do not see merit in the integration of all public utilities regulators into a single merged entity. I believe that the attention given to the integration process would mitigate against the effectiveness of their operations. I also feel that any costs reductions arising from integration would likely be offset with costs associated with reduced effectiveness in regulatory operation.

Similarly, as regulatory bodies under the aegis of my Department are currently structured the prospects for achieving improved decision-making and cost-effectiveness out of a merger are not established. In addition, any merger process carries with it important costs and the achievement of efficiencies in the short term can probably be realised better by the regulators themselves bringing forward proposals within existing structures.

All of the regulatory bodies have been asked, along with all agencies operating under the aegis of my Department to prepare Action Plans for reform under the Transforming Public Service Agenda. My Department will liaise closely with the Regulators in this regard. The Government Statement on Economic Regulation published in October, 2009 stated that the Government is committed to keeping under review options for further mergers between regulators in the short to medium term including those options set out in the Report of the Special Group on Public Sector Numbers and Expenditure. It pointed out also that there had already been significant mergers across postal and telecommunications, electricity and gas regulation.

The Statement also said that Departments would work with regulators on an on-going basis to achieve greater efficiencies through shared administration and legal services as well as the exchange of personnel and joint procurement and Departments will be asked to monitor progress in this regard. The scope for additional efficiencies through the co-location of regulators will also be examined. These matters will be pursued in the context of the Action Plans referred to above.