10 Regulation without Representation? Independent Regulatory Authorities and Representative Claim-Making in the Netherlands, 1997-now

Independent regulatory authorities (IRAs) today have considerable competences. They can regulate and supervise the behaviour of market and societal parties, and set prices for goods and services. They can enforce regulations through fines and ‘naming and shaming’. Thirdly, they have quasi-judicial functions. Yet IRAs are independent in their decisions from both the elected political sphere and sectoral interests. This makes the question whom, or what, these authorities represent a salient one. Yet this question is not often discussed in the literature. In the literature on IRAs, three approaches towards the independent bodies can be distinguished, that either stress their ‘inherent’ legitimacy based on the quality of their decisions, emphasize their ‘derived’ democratic legitimacy from elected institutions, or argue their legitimacy derives from their relations with a variety of actors. Commonly, however, IRAs are considered ‘unrepresentative’ because of their unelected status. In this thesis, it is argued that IRAs should nevertheless be considered non-electoral representative claimants. Viewing IRAs as such yields positive and normative benefits, that may be employed in the further study of these agencies, including in the three outlined approaches. To make this argument, four IRAs in the Netherlands – the telecommunications regulator OPTA, energy regulator NMa Energy Chamber, financial supervisor AFM, and healthcare regulator NZa – are studied from the perspective of the theorization of representative claims by Michael Saward (2010). Representation in this framework is considered a rhetorical and discursive process, consisting of claims to act or speak for others and the simultaneous construction of constituencies in these claims. Representative claims may have electoral and non-electoral resources: they can be made by politicians, interest groups, government organizations, ombudsmen and individuals alike. Likewise, representative claims can be received and accepted or rejected by the targeted constituency on the basis of a variety of criteria. Judgments regarding the democratic legitimacy of representative claims should be relayed to this constituency. Employing the representative claim approach, it is argued that the four IRAs in the Netherlands have been claimed by the Dutch law-making body to independently represent economic and non-economic ‘public’ interests in marketized and liberalized domains. Likewise, the four IRAs themselves in their public self-presentation increasingly claim to represent consumer interests in their activities. On the board level, governors are claimed to be independent experts standing for public and consumer interests, although an exploration of the professional backgrounds of board members reveals they often have backgrounds in the bureaucracy or the regulated sector, and never in the consumer movement. Lastly, on the work-floor level, employees of IRAs interact with representatives of sectoral interests in consultation procedures, in which various representative claim-making strategies are employed. Far from unrepresentative, IRAs should therefore be considered representative claimants – and facilitators of representative claims – in their own right. Independent market regulation involves the construction and reception of representative claims just as much as the traditional electoral sphere. Further study of IRAs and their interaction with sectoral interests should take the representative claim-making character of these independent bodies into account. Lastly, in order to strengthen their democratic legitimacy, IRAs should make their decisions transparent to the consumer public, while consumer organizations should be empowered to represent their constituency inside IRA consultation procedures.