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Appraisal values or 'unit costs'

Each year, significant numbers of workers are injured or made ill by their work. As well as the financial costs from these cases (for example, in terms of lost production and healthcare costs), these cases impose human costs (in terms of the impact on the individual’s quality of life and for fatal injuries, loss of life). The total economic costs of workplace injuries and ill health include both the financial costs incurred and a valuation of the human costs.

HSE produces annual cost estimates of injuries and new cases of ill health complaints in Great Britain associated with current working conditions1, 2. From these total cost estimates, unit costs are calculated by dividing the total costs to society (as calculated by the HSE Cost to Britain model) by the number of new incidence cases for each category of injury and ill health.  The unit costs to society per each incidence of workplace injury and work-related ill health are most commonly referred to as the 'appraisal values'.

The appraisal values give the cost to society per case for a range of workplace injury and ill health incident types namely:

Whilst the appraisal values reflect a broad range of cost categories, for simplicity of presentation the appraisal values can be divided into two main component costs:

The average appraisal values for 2014/15 are summarised below. In most cases, these are the values that should be used for appraisal of HSE interventions3.

Table 1: Cost to Society per case – average appraisal value estimates (£ in 2014 prices)

  Non financial human cost (rounded)   Financial cost (rounded) Total cost (rounded)
Fatal injuries 1,149,000 421,600 1,570,000
Non-fatal injuries 4,500 2,900 7,400
7 or more days absence 18,200 10,300 28,500
Up to 6 days absence 320 550 880
Ill health 9,400 8,200 17,600
7 or more days absence 19,600 16,800 36,400
Up to 6 days absence 270 570 840
Source: HSE Cost to Britain model

Note:

(i) totals may not sum due to rounding.
(ii) These estimates are subject to uncertainty due to both sampling variability in the injury and illness incidence estimates and uncertainty in the underpinning prices and assumptions used to estimate costs. The cost model accounts for the former uncertainty although this range of uncertainty is not shown in the table.

Appraisal values specific to individuals, employers or Government

The ‘Costs to Britain’ cost model also produces appraisal values for the broad groups that bear part of the overall costs to society: individuals, employers and the Government (the 'cost bearers'). These appraisal values reflect only the costs incurred by each cost bearer and do not take into account the net effects of transfers, such as benefits payments from Government to individuals. They therefore are not normally suitable for sole use in social cost benefit analysis of interventions. However, it can be useful to demonstrate the impact of a policy on a particular group within distributional analysis - for example using the costs to employers' appraisal values to estimate the value of any avoided injury or ill health (i.e. the benefits). Indeed enquiries to HSE on the costs of work-related injuries and ill health often request the costs to only one group, such as 'employers' or 'workers'.

The following tables present appraisal values reflecting only the costs to a particular cost bearer.

Table 2: Cost to individuals per case – average appraisal value estimates (£ in 2014 prices)

  Non financial human cost (rounded)   Financial cost (rounded) Total cost (rounded)
Fatal injuries 1,149,000 212,900 1,362,000
Non-fatal injuries 4,500 -170 4,400
7 or more days absence 18,200 -890 17,300
Up to 6 days absence 320 50 370
Ill health 9,400 280 9,600
7 or more days absence 19,600 510 20,100
Up to 6 days absence 270 90 360
Source: HSE Cost to Britain model

Note:

(i) and (ii): see notes from Table 1
(iii) These estimates show negative financial costs (net financial income) on average for non-fatal injuries – this is entirely plausible (as insurance payouts partially compensate for quality of life losses (‘human costs’), but are accounted for in our model only under financial costs).

Table 3: Cost to employers per case – average appraisal value estimates (£ in 2014 prices)

  Non financial human cost (rounded)   Financial cost (rounded) Total cost (rounded)
Fatal injuries  -  103,700 103,700
Non-fatal injuries  -  1,200 1,200
7 or more days absence - 5,000 5,000
Up to 6 days absence  -  100 100
Ill health  -  3,900 3,900
7 or more days absence  -  8,000 8,000
Up to 6 days absence  -  110 110
Source: HSE Cost to Britain model

Note: See Notes (i) and (ii) from Table 1

Table 4: Cost to Government per case – average appraisal value estimates (£ in 2014 prices)

  Non financial human cost (rounded)   Financial cost (rounded) Total cost (rounded)
Fatal injuries  -  104,300 104,300
Non-fatal injuries  -  1,800 1,800
7 or more days absence  -  6,300 6,300
Up to 6 days absence  -  410 410
Ill health  -  4,100 4,100
7 or more days absence  -  8,300 8,300
Up to 6 days absence  -  360 360
Source: HSE Cost to Britain model

Note: See Notes (i) and (ii) from Table 1

Footnotes

1 HSE will be publishing a separate estimate of costs of work-related cancer towards the end of 2015

2 More details on the latest costs estimates.

3 The appraisal values should be applied with care. In particular, the user should consider whether the injury and illness classifications above are appropriate for the injury and illness types under consideration. Where these appraisal values are not considered suitable for the appraisal at hand, specific unit cost estimates should be derived

Updated 2016-10-14