Small is beautiful (maybe)…

I think it’s fair to say that Ofcom takes considerable pride in its efficiency and value for money.  To quote from the Draft Annual Plan for 2013/14: 

“…Ofcom has responded to the wider challenges facing public expenditure by reviewing how it delivers effective, targeted regulation in the interests of citizens and consumers, while maintaining value for money for its stakeholders” 

This value-for-money narrative goes back to the period just after Ofcom’s formation in 2003 when the new organisation argued – with some success – that its economies of scale allowed it greater efficiency over the combined cost of its constituent sectoral regulators – Oftel, the ITC, the Radio Authority and the RA.  But is it possible that an entirely different regulatory construct could prove even more effective?  That may be an implication of a recent paper by the Scottish government entitled Economic and Competition Regulation in an Independent Scotland.  In essence, the thesis here is that a combined economic regulator for Scotland, covering all utilities, transport and communications industries would provide both a better focus on Scottish concerns and do it at lower cost.  Regarding the former, broadband is a particular concern: 

“Scotland has a challenging geographic landscape with a number of rural and remote communities to serve. In an independent Scotland, there will be a need to look at regulation differently to eliminate the digital divide and to ensure our world class digital ambitions are delivered. A strong regulator focused on the needs of Scotland's economy, business and consumers will be needed to tackle these issues”. 

In terms of efficiency, the paper is unambiguous: 

“…The consensus from all the discussions which we have held, to date, is that merging economic regulation functions benefits both businesses and consumers…Our detailed analysis…indicates that a combined regulatory body is achievable, less bureaucratic and more cost effective”. 

Does this suggest that a UK regulatory regime excluding Scotland might also require reassessment?  If so, is the current Ofcom model still fit for purpose for us Sassenachs?  Make sure next September 18^th is in your diary!