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Offshore Charging Review Group

Minutes of the Meeting held on 2 October

Present:

Mr Ian Whewell, Chair, HSE

Industry Members

Mr Bob Kyle, UKOOA
Mr Wes McDonald, IADC
Ms Jane Bugler, IMCA
Mr Paul Holman, BROA

HSE Members

Mr Bill Tomkins, PEFD
Ms Lesley Stanley, PEFD
Ms Paula Moorhouse, PEFD
Mr Kelvin McFadyen, HID, Secretary

Welcome and Introductions

The Chair welcomed everyone to the meeting, introducing Wes McDonald, Lesley Stanley, who has replaced Mark Reyland, and Paula Moorhouse.

Apologies had been received from Rab Wilson, Amicus and from Nigel Savage, Shell UK. Nigel would no longer be attending meetings following UKOOA's decision to reduce its representation.

Minutes of the Meeting held on 18 October 2002

The minutes were accepted having been circulated to members for comment prior to posting on the HSE website at http://www.hse.gov.uk/charging.

Matters Arising (not covered elsewhere)

The action at Min 4 on HSE to further look at the question of small value invoices was done but the position remains unchanged. A new IT system is in development and it remains to be seen whether that will ease the situation.

There were two actions against Min 18.

The action at Min 20 regarding the ICRG Report had been discharged.

The action on Industry at Min 22 was discharged through the reduced UKOOA representation.

Forecasting Costs (OCRG 2003/2)

Paper OCRG 2003/2 had been circulated prior to the meeting. It reported on the outcome of a feasibility study to evaluate the practicality of forecasting chargeable activity. The report concluded that accurate forecasting was not feasible given current systems and that the supporting activity required to make it so was likely to impact on costs. Industry suggested that the charging infrastructure limited contact between Duty Holders and HSE and does not help prediction. It was suggested that some form of fixed charge or annual fee would aid both predictability and the conduct of business between the two sides, with a consequent improvement in safety management. Industry indicated a willingness to lobby for such a change.

HSE said that to switch to a levy charge would require a change to the HSW Act and that it could prove very difficult to find a suitable legislative vehicle to do that. Related primary legislation would be required on which an amendment to the HSW Act could be attached. Whilst this had been possible for the rail industry using the Transport and Railway Safety Bill, no offshore-related primary legislation was in the pipeline. However, if industry were prepared to lobby for such a change HSE would not raise objections.

Charging Efficiency Project (CEP)

Members were presented with a brief update on the recommendations from this project (OCRG 2003/5). Dr Fullam had made a presentation on his report to industry in May. There were a large number of recommendations, some of which could have a significant impact on costs and others that would have little effect. Prior to receiving this report a wider change process had started in HSE. The CEP recommendations impinged on efficiency across HSE, not only the charging regimes, and fitted in with the change process. Therefore it was decided that the CEP recommendations should be taken forward as part of this overall change process. There will be no immediate impact on costs. The earliest that this could be predicted was sometime next year. It also had to be recognised that some recommendations would have significant start up costs that may feed into charge out rates before benefits start to be realised.

Industry cited the Deloitte & Touche report which commented on the ratio of support staff to inspectors. HSE said that there was a need to balance the need for support and inspection staff and that this was being looked at. The result could be the freeing up of inspector time to do more front line work, or greater administrative staff involvement in front line activities with a possible reduction in the number of inspectors. The aim was to make the most efficient use of the resources we have, particularly as funding constraints mean HSE has to become more efficient.

Proposed Charge Out Rates 2004/05

Members were presented with the outturn figures fore 2002/03, which showed that the rate should have been £147 per hour rather than the £130 charged. The rate for 2004/05 had yet to finalised. It was envisaged that the rate would not increase and that it could probably go down. There had been some reduction in overheads and it was thought that the new rate would be around £150. As soon as the rate is finalised members would be informed.
Action: HSE

Report to the ICRG (OCRG 2003/3)

The draft report had been circulated prior to the meeting. Members were asked if they wanted to add anything. It was agreed that the pressure for an alternative means of charging, discussed under the item on forecasting, should be added. It was agreed that the IADC would coordinate an industry paragraph covering this, to be with the Chair by the end of October.
Action: Industry

HSE suggested that the ICRG had come to the end of its useful existence. It was already just a virtual committee that dealt with matters by correspondence. Its original purpose was to deal with common interests across the four charging regimes. Charging has settled down and there are no longer any common concerns for it to deal with and there is no apparent added value in its existence. Any concerns could be put directly to the HSC without going through this extra layer. No one demurred from the proposal to recommend that the HSC disband the ICRG.

Any Other Business

None was raised.

Date of Next Meeting

It was agreed that in the interests of efficiency the next meeting should coincide with that of the HSE Industry Liaison Forum, as many members are attendees at both. The date of the next meeting is to be confirmed.


Updated 2008-12-05