The chemicals industry is set to benefit from more effective, less burdensome enforcement of regulation following a government-led consultation with the sector.
Reforms include plans to integrate inspection regimes, provide greater support to companies who are considering growing their business, and to set out more transparent appeals mechanisms. This will help provide firms with greater certainty and more efficient regulation, enabling them to plan more effectively and concentrate on meeting business objectives.
The Focus on Enforcement review examined the industry’s day-to-day experience of regulation and gathered views on how current enforcement practices could be reformed to remove unnecessary red tape. The review focused in particular on how the Control of Major Accident Hazards (COMAH) regulations are enforced.
Responding to issues raised by the sector, the Health and Safety Executive and Environment Agency will also improve the transparency of charging; provide greater assistance for companies moving into the COMAH regime; increase consistency in inspections; and establish clearer links between company performance and inspection frequency.
Enterprise Minister Michael Fallon said:
The chemicals industry is a driver of growth, jobs and innovation, and we can’t afford to weigh firms down with bureaucracy. We must regulate firms in a way that helps them prosper, weeding out unnecessary hindrance or uncertainty while promoting the highest standards.
The reforms announced today will provide clarity and consistency for hard-pressed businesses, and help regulators focus on maintaining vital safety safeguards for the public.
Steve Elliott, Chief Executive, Chemical Industries Association said:
We believe this review is good news for the chemical industry and the regulation of businesses, making an essential contribution towards the UK’s economic recovery and growth.
Companies, workforces and the general public have much to gain from a pragmatic, efficient and transparent approach to regulatory enforcement. We look forward to playing our part in delivering a regime that gives confidence to all.
The Health and Safety Executive (HSE) and Environment Agency (EA), which jointly form the Competent Authority for the sector, have undertaken to:
- co-ordinate their activities more closely, providing more consistent messages and greater efficiency to operators
- reduce visits, burdens and the scope for duplication or contradiction by integrating some of their inspection regimes
- increase transparency in the cost recovery that applies to inspections, setting out performance standards and appeals mechanisms
- review appeals mechanisms, and publish quarterly, anonymised data on appeals and their success to increase transparency and confidence
- provide site level account managers as a single interface with the two main regulators
- develop an approach with industry that can take greater account of company performance in planning the frequency and level of inspections
- work with industry to review some of the core processes and paperwork in the regime to identify improvements that will reduce business burdens
- hold an industry summit to agree the detail of the improvement programme and secure full industry participation in delivery
Gordon MacDonald, chair of the COMAH Competent Authority Strategic Management Group, said:
The Competent Authority welcomes the findings of this review and looks forward to continuing work with industry to further improve the effectiveness of the regulatory regime for major hazards. Effective risk management and control lies at the heart of a successful chemical business and supports growth, employment, profitability and innovation.
We note the positive feedback about the quality of inspectors which was regarded as generally high and the good working relationship between the sector and the regulators. We are determined to work with industry to make the COMAH regime as clear and straightforward as possible for all companies without compromising the protection of people and the environment.
The review took evidence through discussions with the sector and through the Focus on Enforcement website. Input was received from a range of trade bodies, individual businesses and from the regulators themselves.
The full review findings are at: http://discuss.bis.gov.uk/focusonenforcement/
Notes to editors
1.The key findings of the review were as follows:
- the need for the regulations is clearly understood and accepted by the industry
- the quality of inspectors is valued and regarded as generally high
- there has historically been a good working relationship between the sector and the regulators
- recently introduced intervention plans (which provide individual companies with a two year forward plan of inspections) have been welcomed
- the charging regime and the way it operates is not working optimally for firms and would benefit from a clearer, more contractual relationship being established
- the sector would welcome greater joined up working in and between the two regulators, to reduce inspection burdens and increase consistency of advice
- inconsistency in enforcement is a significant annoyance causing additional costs and uncertainty
- the appeals mechanism is not widely understood or used and is not considered to be independent
- the sector would welcome greater use of performance data in the planning of inspection visits (allowing greater ‘earned recognition’ would reduce the burden on the better companies and incentivise improvement)
- delays in planning decisions – which can take 12 months or longer – can limit business expansion and growth
- there is scope to streamline key documentation required by the legislation (safety reports), and the processes for producing and signing these off
Evidence provided by the sector clearly pointed to common issues faced by companies, and Government has worked with the lead regulators to address these and deliver real improvements.
2.The Focus on Enforcement review looked in particular at enforcement of the Control of Major Accident Hazards (COMAH) regulations in the chemicals manufacturing and chemicals storage sector. The review team took evidence through visits and face-to-face discussions and through the Focus on Enforcement website. Input was received from a range of trade bodies, from individual businesses and from the regulators.
3.The Control of Major Accident Hazards (COMAH) regulations cover industrial facilities which pose a major potential hazard to the workforce, neighbouring communities or the environment, due to the quantities and nature of the substances they handle. The COMAH regime aims to ensure that risks are properly managed and controlled in a safe and sustainable way, and to provide public reassurance that this is the case. For more information about the COMAH regulations visit: www.hse.gov.uk/comah/index.htm or www.environment-agency.gov.uk/business/sectors/37111.aspx
4.The Health and Safety Executive (HSE) and the Environment Agency (EA) are jointly the Competent Authority in enforcing regulations within the scope of the Focus on Enforcement review.
5.Where appropriate, the Competent Authority also envisages extending the above reforms to and in consultation with other sectors covered by the COMAH regime. (In addition to chemicals COMAH covers other sectors including: oil and gas refining and storage, water treatment works, explosives and fireworks manufacturing and storage etc).
6.The government’s economic policy objective is to achieve ‘strong, sustainable and balanced growth that is more evenly shared across the country and between industries’. It set four ambitions in the ‘Plan for Growth’ (PDF 1.7MB), published at Budget 2011:
- to create the most competitive tax system in the G20
- to make the UK the best place in Europe to start, finance and grow a business
- to encourage investment and exports as a route to a more balanced economy
- to create a more educated workforce that is the most flexible in Europe
- Work is underway across government to achieve these ambitions, including progress on more than 250 measures as part of the Growth Review. Developing an Industrial Strategy gives new impetus to this work by providing businesses, investors and the public with more clarity about the long-term direction in which the government wants the economy to travel.