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COMAH Charging Review Group

Minutes of the Meeting Held on 26 October 2005


Present:

Mr Kevin Allars, Chairman, HSE

Industry Members

Mr Nick Berentzen - CIA
Mr Ian McPherson - UKPIA
Mr Robert Watson- Transco

Competent Authority Members

Mr Bill Tomkins- HSE
Mr Mark Reyland- HSE
Mr Brian Davis - EA
Mr Frank McMahon - SEPA
Mr Kelvin McFadyen - HSE, Secretary


Welcome and Introductions

1. The Chairman welcomed everyone to the meeting. Mr Watson had replaced Mr Musgrave who had retired. Apologies had been received from Hugh Robertson, TUC, Jim Mowattt, TW&G, Tom Fidell, LPGA, Wil Huntly and Alex Radway, both EA and Anton Wilson, HSE.

Minutes of the Meeting Held on 13 October 2004

2. The minutes had been agreed by correspondence and published on the HSE website.

Matters Arising

4. Min 4 – Hugh Robertson has replaced Owen Tudor and will similarly not attend meetings, only receive papers. No nomination had been made to replace Nigel Bryson.

5. Min 15 – EA and SEPA members were present at the meeting and would clear this item under the appropriate Agenda item.

2004/05 Outturn

6. HSE and EA outturn figures were circulated to the meeting. It was agreed that these should be circulated in advance in future.

7. The HSE figures were broadly similar to the previous year in terms of the percentage allocation of costs. This was the first time EA had presented figures in this format. Figures for COMAH are also included in the EA published accounts. Whilst the percentage allocated to EA Operational Management costs appeared high in relation to those of HSE it was thought that this was due to a difference in accounting terms used and EAs inclusion of General Admin Expenditure in the Operational Management category. If the HSE operational strategy and general admin costs are combined the percentage is broadly similar. SEPA had not produced figures in this format, however the costs are included in their annual accounts published on their website. In 2004/05 SEPA under recovered their costs by £2000.

8. It was agreed that Mr Reyland would liaise with EA and SEPA to coordinate the out-turn data into a common dataset single sheet, covering all three regulators.

Proposed Rates 2006/07

9. SEPA will be increasing all their chargeable work rates by the RPI (2.7%). Their rate for COMAH work will be £124 ph.

10. EA will follow the HSE rate and reduce theirs to £114 ph.

11. The HSE proposed rate of £114 was notified to members with the agenda for this meeting.

12. The Chairman said that the HSE rate over the past 3 years had been £113-£115-£114. Given increases in costs such as payroll, superannuation etc there was a downward trend in real terms. HSE is also looking for efficiencies in estates costs by sub-letting surplus accommodation, but these will take time to feed through to the hourly rate. HSE is putting more into front line staff activities and has effectively halved overhead staff costs. There are more efficiencies in the pipeline. HSE is now using high quality junior administrative staff as Regulatory Compliance Officers freeing up inspector time from giving general advice and organising awareness events etc. These staff are not automatically regarded as trainee inspectors, although some may eventually progress their careers in that direction. They are relieving front line inspectors of some of their more run of the mill tasks, improve the advisory nature of HSE’s business, doing the work cheaper and are not directly charged for.

13. Following the Hampton Review the Competent Authorities are working jointly with industry and unions on developing more transparent risk based inspection programmes. This should eventually have an impact (at least) on invoices for good performers.

14. At the last meeting it was mentioned that HSE was developing a new IT system (COIN) to cover the information needs of all its operating Directorates. The system is late in being implemented, but will be rolled out progressively over the next few months. It is anticipated that the new system will provide for efficiencies of scale.

15. HSE’s building and travel costs are up slightly this year, but the increased travel costs mean that inspectors are getting out to sites more, which is what industry has been requesting.

16. Industry expressed their appreciation of the real efforts being made by HSE to cut costs and get more staff on the front line.

17. EA said that in real terms they had managed a 3.7% reduction in costs. COMAH was a small part of their responsibilities and they had, to date, concentrated more on their greater responsibility for pollution control. However, in the coming year they planned to thoroughly review their COMAH activities and costs using the transparency now available from a new management information system (1B1S) and other information sources. This was welcomed by industry.

18. SEPA similarly said that COMAH was a small part of their responsibilities. They have been covered by a recent Policy and Financial Review by the Scottish Executive and will continue to look to share accommodation with other Scottish Executive bodies in order to reduce costs. SEPA use the RPI as a basis for determining cost changes for all their chargeable activities.

19. On the subject of HSEs new IT system (COIN) it was inevitable that there may be glitches with errors/double-accounting, unfortunately, occurring during the changeover phase over the next 4/6 months. Whilst everything will be done to make this as seamless as possible mistakes can happen. Should invoicees notice anything odd with their bills they should get in touch with the Charging Team in Aberdeen as soon as possible. This can be done by e-mailing HIDCHARGE@ hse.gov.uk.

20. The proposed HSE rate will be submitted to the HSC in a paper for their 6 December meeting and will include any comments members may wish to input. If agreed the rate proposals will then be submitted to the DWP Minister for approval and the making of the 2006 Fees Regulations. Although the EA and SEPA rates are outside the HSCs remit Industry asked that they be included for comparison.

Queries and Disputes Procedures

21. There has not been a Level 3 dispute for some years, but two have now arisen in other regimes. This has caused HSE to review the procedures published on its website. This is mainly a tidying up exercise to reflect organisational changes and the reality of what happens with queries. The procedures refer to the Disputes Panel Chair as HSEs Director of Safety Policy, a post that has not existed for two years. Queries are supposed to be directed to the finance branch in the first instance. In most cases the finance branch simply forwards the query to the charging team responsible. Consideration is being given to whether the charging teams should become the first point of contact, thus removing a link in the chain and speeding up responses.

22. HSE will be contacting the independent members of the disputes panel to see if they are still willing to be called upon. If not industry members will be asked to make fresh nominations. The independent members should have a good knowledge of the industry and be without current industry connections.

23. Industry asked to see the revised procedure once it had been drafted. They also noted that the position on queries in 2004/05 looked positive with none being dealt with above Level 1. The Secretary said that the majority of those queries where the invoice was varied resulted from the wrong operator being charged, as changes of ownership were sometimes late in filtering through.

Alternative Charging Methods

24. HSE will be looking at alternative methods of charging, and will consult with EA and SEPA. Charging is not liked by either inspectors or industry and a relook at a banded scheme is warranted. Work on this has yet to start. The work on risk base inspection needs to be concluded first so that there is some basis to start from. If anything comes out of this it is likely to be around three years before anything could be put into operation. EA now have experience of risk-based schemes that they did not have four years ago when this was last considered. That experience will be very useful in developing any changes. Progress will be reported back to the next meeting. EA added that they were very conscious that their work on COMAH and pollution control was closely related and they needed to ensure that industry was not double charged.

Any Other Business

25. None was raised.

Date of Next Meeting

26. The Chairman said that a meeting next year would seem sensible to discuss progress on alternative charging methods. At the same time we should review whether regular meetings are necessary. Depending on a potential agenda it could be decided that matters could be dealt with by correspondence rather than convene a meeting. To assist this it would be necessary for the Competent Authorities to agree their proposed rates and notify industry earlier than at present.

27. The next meeting was set for 10 October 2006 in London, starting at 1100.

Updated on 10/11/2004

Updated 2008-12-05