It is recognised that good health and safety is good business, but some firms may seek to gain a short-term competitive advantage by cutting corners and putting workers and the public at risk.
The balance will shift from October 2012 when, for the first time, those outside of the high-hazard industries who flout H&S laws will pay their fair share of the costs to put things right.
This will provide a further incentive to operate within the law and will help level the playing field between those who comply and those who don’t. Law-abiding businesses will not pay a fee.
Costs will be recovered from the start of the intervention where a material breach has been identified, up to the point where HSE’s assistance in putting matters right – investigating and taking enforcement action – has concluded.
A ‘material breach’ is when, in the opinion of the HSE inspector there has been a contravention of health and safety law that requires them to notify a person in writing of that opinion. That written notification may take the form of a notice of contravention, enforcement notice or prosecution. If a material breach is identified then the Fee for Intervention (FFI) will apply. HSE’s fees are currently £124 per hour.
For example, failure to properly display the health and safety law poster in an otherwise well-run firm would normally be dealt with by verbal advice, and costs would not be recovered. However, inadequate guarding of machinery, which could result in significant injury to employees and requires HSE to do more than give verbal advice, would attract a fee.
A number of questions and concerns emerged from the consultation, which took place in summer 2011. Would HSE be looking to make money from the scheme rather than following its priorities? Will FFI harm the constructive relationship between HSE and the businesses it regulates? Is the disputes process sufficiently independent?
We have been happy to address all these points.
The FFI is not a money making exercise for HSE. The scheme will not turn a profit. It is simply about recovering our costs, and making those who break the law, rather than the taxpayer, liable for the cost of putting their failures right.
Concerns about the impact on HSE’s relationships with the businesses it regulates were raised when cost recovery was introduced in the high-hazard industries, but significant problems did not materialise then and we do not expect them to now.
Serious material breaches giving rise to significant risks can occur in any organisation, irrespective of size and regardless of whether they have yet led to injury. The key to cost reduction is being compliant or, putting things right quickly when necessary.
We have published clear guidance on how the scheme will work, including examples of material breaches, and after a year of operation, we will publish a public report setting out how FFI is working in practice.
The underlying issue is one of fairness – those who provoke an HSE intervention should pay the costs. This is not only fair, it’s good business and good for business too.