Opinion: Reforming Regulatory Sanctions - A Personal Perspective


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The Regulatory Enforcement and Sanctions Act 2008 (considered in detail by Carolyn Abbott at Env L Rev 11 (2009) 38) contains provisions that represent the start of a process of fundamental reform in the way we design and think about sanctions for regulatory offences in the United Kingdom. In the field of environmental law, the heavy reliance on the criminal law as essentially the only formal sanction available to regulators has long been a source of concern. The system is in stark contrast to countries such as the United States where the Environmental Protection Agency regularly makes use of administrative penalties. In this country, too, economic regulators such as the Competition Authority or the utility regulators impose substantial penalties in respect of legal breaches, often way in excess of fines imposed for regulatory offences by the courts.

Less than a decade ago, the Department of Environment, Food and Rural Affairs initiated various studies examining ideas for substantial reform in the way the UK implemented and enforced environmental law. Environmental courts and tribunals figured highly, and I too was then involved in a study on the potential for civil penalties in the field of environmental law.1 It proved difficult to form a consensus even within the environmental law community for the institutional reforms that might be needed. But intellectually perhaps the biggest challenge was to justify why environmental law needed such special treatment. If specialist courts or civil penalties were a good idea for environmental law, why not health and safety, consumer law, and other areas of business regulation?

A case can be made for singling out environmental law, but it is not wholly convincing. Certainly, by 2004 the momentum for significant reform appeared to have stalled, especially with the departure from Government of the then Environment Minister, Michael Meacher, who had been a prime mover behind the research and debate. But a year later there emerged a catalyst for change from an unexpected quarter. The Treasury commissioned a Review led by a senior businessman to examine generally the relationship between regulators and the regulated community. Improved environmental protection was clearly not uppermost in the Treasury's mind, and the Hampton Review was seen as a key part of the Governments reform agenda, essentially designed to lighten the burden of regulation on industry Nearly every area of business regulation was covered, and over 60 national regulators as well as local government were included, the main exceptions being the economic and utility regulators.

The Hampton Report, published in 2005,3 recognised the importance of regulation but identified unnecessary burdens on industry in terms of an excessive number of regulators, and overlapping inspections and data requirements. Hampton was not concerned with the substance of regulation as such but more with the process of regulating. The Review argued that regulators should avoid a 'tick-box' mentality towards enforcement, but should adopt a stronger risk-based approach that focused resources on where they would have greatest impact, and should keep the need for securing outcomes at the forefront of their enforcement strategy. Hampton advocated advice and persuasion as the first approach towards securing compliance, but recognised the underlying importance of an effective sanction regime. He was concerned that the criminal law appeared to dominate the formal sanction route, and often appeared to lead to disproportionate results. He therefore recommended that Government initiate a special Review that focused solely on the issue of regulatory sanctions.

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