Bannon was just recorded on audio the other day at some meeting. The topic was Trump's clear mandate to disassemble the administrative state and gut non-statute regulations. That's the plan. They want to make sure if something's not in the statutory code it's not legally enforceable. The want to completely dismantle the Executive agencies beyond Defense, State, and DHS basically.
Pai's not there to provide regulations or play games with regulations. He's there to remove them. "Improved demarcation" means in this context he wants to shrink what each one covers to the point there's obviously no overlap.