A British Innovation Principle
23 September 2021
SUGGESTED
Publications
14 September 2021
Publications
1 October 2021
Economic Theory
11 November 2024
https://iea.org.uk/wp-content/uploads/2021/09/IEA-_Regulatory-Affairs_A-British-Innovation-Principle-BU_web.pdf
Summary
Fullscreen Mode
- The UK is incorporating the precautionary principle into domestic law. This should be balanced with an innovation principle.
- Innovation is vital for economic growth and prosperity. But there are widespread concerns that badly designed and targeted regulation holds back innovation, due in part to excessive restrictions brought about by misapplication of the precautionary principle.
- The precautionary principle is imprecisely defined and poorly understood. The EU acknowledged this and introduced an innovation principle to ensure that the effects on innovation of proposed measures would be duly taken into account, and desirable innovations would be supported.
- The EU Innovation Principle conflates general support for innovation with industrial policy, more specifically the questionable ability of government to identify desirable future technologies and innovations and plan for the acceleration of their delivery. This misdirects the purpose of the EU principle towards political projects rather than creating an environment in which inspiration, investment and commercialisation can thrive in the wider economy without a plan or specific support of any kind.
- The precautionary principle applied in the UK through EU law and has been incorporated into domestic law after the UK left the bloc. It formally applies in fields such as the environment and climate, but a precautionary approach can be seen more widely, for example in competition law. Similarly, it is not only regulation in the fields of science and technology that affects innovation – employment law and financial services regulations affect the innovativeness of firms that are subject to them.
- Although innovation effects are included as standard in impact assessments for regulatory measures, they are not currently covered with rigour and the quality of cost-benefit analysis is often questionable.
- Reforms to the regulatory framework could deliver a more proportionate application of the precautionary principle that gives due weight to the benefits to (amongst other things) the environment, human health and wellbeing that innovation and economic growth can bring – this could be framed as an innovation principle.
- Failure to implement such reforms could mean that the UK will import the burdens of the precautionary principle from EU law without the protections for innovation from its regulatory toolkit and legal order.
Fullscreen Mode
SHARE
