Business Impact Target 2016-2017
Reports, plans and updates
- Publication date
- Industry sector
- Supply and Retail Market
- Distribution Network
- Offshore Transmission Network
- Transmission Network
- Generation and Wholesale Market
- Scheme name
- ECO
What is the Business Impact Target?
Under the Small Business, Enterprise and Employment Act 2015, each new government is required to set a target for the economic impact on business of qualifying regulatory provisions made during the course of the Parliament – this is the Business Impact Target (BIT). The government’s target for the 2015 Parliament was a saving of £10 billion to business and voluntary or community bodies.
The Enterprise Act 2016 introduced a statutory requirement on regulators, including Ofgem, to carry out assessments of the economic impact on business of qualifying regulatory provisions. These assessments contribute to the Business Impact Target.
The process we follow
Regulators must assess regulatory provisions to identify which are qualifying regulatory provisions for assessment.
A “regulatory provision”, in relation to a business activity, means a provision which—
- imposes or amends requirements, restrictions or conditions, or sets or amends standards or gives or amends guidance, in relation to the activity, or
- relates to the securing of compliance with, or the enforcement of, requirements, restrictions, conditions, standards or guidance which relate to the activity.
We use the BIT methodology as set by government to assess qualifying regulatory provisions. The BIT score is derived from the Equivalent Annual Net Direct Cost to Business (EANDCB) and rounded to the nearest £100,000. It is an estimation of the direct cost to businesses. A negative score is a cost to business, whereas a positive score is a benefit to business.
We submit our assessments to the Regulatory Policy Committee (RPC) for verification. The RPC is an independent body appointed by the government.
Additionally, regulators must publish a summary of all regulatory provisions that are non-qualifying for the purposes of the BIT because they fall into an administrative exemption. These are non-qualifying regulatory provisions.
Reporting on the BIT
In order to meet our requirements for the reporting period 8 May 2015 to 8 June 2017, we are publishing:
- a list of the qualifying regulatory provisions which have come into force or ceased to be in force during this reporting period.
- an assessment of the economic impact on business of each of the above qualifying regulatory provisions, verified by the Regulatory Policy Committee; and
- a summary statement of all non-qualifying regulatory provisions that came into force or ceased to be in force during this reporting period.