Gas Transportation Charging Review Group

Minutes of the Meeting held on 9 April 2002


Dr Neil Johnson Chair, HSE

Industry members

Mr C Musgrave, Transco;
Mr P Clark, AIPGT;
Mr D Childerhouse, AIPGT.
Deloitte & Touche (item 10)
Mr D Cowley
Mr M Sapsford

HSE members;

Mr F Perkins HID;
Mr W Tomkins, PEFD
Miss P Moorhouse; PEFD
Mr K McFadyen, HID, Secretary;
Mrs J Cooper, HID, observer.

1. Welcome and introduction

The Chairman welcomed everyone to the meeting. Paula Moorhouse was attending for Mark Reyland and Jill Cooper, a member of the Charging Team as an observer. Apologies had been received from John Taylor, UNISON & Ms Channon, CBI.

The Chairman said that a tannoy announcement would be made at 1130 to mark the two minutes silence to respect the Queen Mother.

2. Minutes of the meeting held on 26 September 2001

The minutes were accepted.

3. Matters arising

Gas Safety Assessment Manual (item 3.2) The manual had been issued to inspectors as a working draft, but was not yet in a format suitable for putting on the Internet. The Chairman said that hard copies would be taken to the next Public Gas Transporters Safety Forum. In the interim electronic copies of the manual could be made available on request. Requests should be made to Tim Small.

ICRG Report (item 4.3) The ICRG report was amended as agreed.

4. Position of charges to date

Mr Clark raised a query as to how the over recovery of the fixed overhead in the last period had been reflected in this year's hourly rate. HSE explained that the amount that had to be recovered was proportionate to the amount of chargeable work. The more chargeable work an inspector does the greater the percentage of the fixed overhead for that person that has to be recovered. The trading account produced each year informs the charge rate calculation by indicating what the rate should have been for the amount of work done. The rate for the subsequent year can be reduced if the indication was that the rate was too high, but it cannot be increased simply because the rate was too low. Inspectors plan to do specific hours of work that predicts the income. If more work than planned is done, that does not mean an over-recovery of costs has occurred.

Paper GSMR 2002/2 was noted.

5. Update on review of charging

Mr Tomkins said that the first draft of the gas review had been received two days previously. The evaluation project team would be going through this with Deloitte and Touche soon. He reminded the group that the review was commissioned for the HSC. A report on the COMAH evaluation, plus those on the efficiency of the charging process, effectiveness of the queries and disputes procedure and the draft report on reasonableness of chargeout rates would be going to the HSC on 16 April. HSC would then write to Ministers with their views on the reports and proposed actions.

There was nothing in those reports to suggest that health and safety had been adversely affected by the introduction of charging. The efficiency of the charging process has been steadily improved over the past year. The queries and disputes procedure is viewed as long-winded and bureaucratic, but it works. Duty holders are able to put their points across. Mr Musgrave queried the evidence for the last sentence in para 4.6 of the report that implied the level of gas queries was due to duty holders being unfamiliar with charging. Mr Tomkins agreed to take this up with Deloitte & Touche.
Action: Mr Tomkins

Mr Musgrave also asked whether there was any information on precedent decisions and the wider lessons to be learned from disputes. HSE replied that generally the types of query received would be used to update and clarify the guidance to industry. For level 3 disputes information would be provided to the relevant review group for consideration.

Mr Tomkins emphasised that the reasonableness report was still under discussion with Deloitte & Touche. HSE had some methodology concerns. Parts of the report were in dispute and parts were agreed. Until the report is finalised members were requested to treat their copy as for personal information only. Once Ministers have cleared the reports, HSE intended to publish them on the Internet.

6. Revision of guidance on disputes

The group noted that HSE had published guidance on how to use the procedure on the Internet, as an annex to the main procedure.

7. Frequency and location of meetings

The Chairman suggested that the group should reserve a date for an autumn meeting with the expectation that it would not be used. A date should also be set for a spring meeting. The group agreed this. After some deliberation it was also agreed that London was the most convenient meeting location.

8. Any other business

There was no other business.

9. Date of next meeting

The dates of the next two meetings were set for 8 October 2002 and 8 April 2003. The Secretary would canvass members' views on the need for the October meeting a month beforehand.
Action: Secretary

10. Presentation by Deloitte & Touche

Mr Cowley introduced Mr Sapsford who presented the general findings of the gas transportation review. Mr Sapsford said that the trade unions consulted had raised no concerns. A copy of the overheads used in the presentation is attached to these minutes.

Points raised during the presentation were:

Updated 2008-12-05