Select Committee on Transport Written Evidence

Memorandum by Alan Osborne Esq (FOR 124)



  1.  I have been creating frameworks and systems to improve health and safety for over 20 years. I graduated with a degree in Health and Safety Engineering in 1982, and spent my early years working in safety management roles in the chemical industry (Bayer, Burmah Oil and BOC). Fifteen years of my career have been at director level within the transport industry.

  2.  I was Safety and Quality Director for London Underground Ltd (seven years) and Director of Safety and Risk Management for the British Airports Authority (eight years). Following Lord Cullen's criticisms of the Health and Safety Executive (HSE) he recommended that the HSE should create a new post and appoint "a person of outstanding managerial ability" with the objective of injecting "new imagination and energy". I joined the HSE as its Director of Rail Safety in November 2002. I resigned the following October after 11½ difficult months in the job. I am a fellow of the Institution of Occupational Safety and Health and a fellow of the Institute of Quality Assurance.

  3.  The focus of my evidence to the Transport Committee is safety regulation. My experiences have, though, brought me to a fundamental belief that safety, quality and efficiency are inextricably linked and that actions which bring about high performance levels are often the same. Fundamentally, a failure to clarify and align responsibilities, accountabilities and authority will make even mediocre safety, quality and efficiency performance elusive.


  4.  There is little doubt that privatisation caused the rail industry to fragment. Various mechanisms have been introduced to maintain cohesion between the resulting organisational entities. Specific safety mechanisms have included the introduction of a safety case regime, new audit processes, the Railway Group Safety Plan, Railway Group Standards, the creation of RSSB and the creation of the Strategic Rail Authority's safety development department etc. These are manifestations of an industry which has tried (and continues to try) extremely hard to work in a joined up and co-operative way.

  5.  Good work is in progress by a number of the organisational entities (which I shall call compartments from now on) within the industry but the key question remains whether the fundamentals are yet right to achieve the high levels of safety, quality and efficiency performance we all seek. The underlying concern is that our railways are rather crowded with separate compartments bringing the attendant risk that responsibilities, accountabilities and authorities are not clear and do not align. This can have an adverse impact on the flow of safety critical information to enable effective decision-making and has been a feature of a number of the recent serious rail accidents. There is little doubt though that recent decisions by Network Rail to reduce the number of organisational interfaces will improve the situation, provided the transition is managed effectively.

  6.  What of the other compartments relating to the industry though, particularly those with regulatory roles? It is equally important that responsibilities, accountabilities and authority align across the range of Government departments and I am not sure that they do. Who does what and why is not clear. A further complication is that when trying to resolve an industry-wide problem it is not uncommon to have over 30 people at the meetings representing the different industry compartments. This slows down analysing and solving problems and can lead to poor decisions.


  7.  The Health and Safety at Work etc Act 1974 is potentially very flexible because it contains the test of "reasonable practicability". In essence, this allows a broad trade-off between risk and cost. If cost is grossly disproportionate to the residual risk then the dutyholder would not be expected to incur such a cost. The courts have the final say on this however. There are uncertainties though in the way the test is applied (by both the industry and its regulators) to a railway system. It can be interpreted inconsistently and whilst it has been successfully used for the safety of workers for many years, it has been more problematic for broader aspects of society risk and specifically for the safety of the traveling public. Whilst there are many influences, this is a probable root cause of "gold-plating" of standards development and implementation. It causes railway managers and staff to try to make absolutely certain that the test has been met at every step in a project and this adds to cost and can be of dubious safety benefit ("better to not meet cost and programme targets than risk going to jail"). The effective management of risk must be our goal—not to attempt its total elimination.

  8.  It must be said that ineffective project management and cost control mechanisms from the Railtrack era have also played a significant part in escalating project and operating costs. The extensive use of consultants (many of whom are also unsure about how to apply the test of reasonable practicability and associated cost benefit analysis tools) and a growth in central overheads has also added to costs. To some extent though this has been caused by a lack of confidence by railway management and so the circularity continues. Network Rail are tackling some of these issues but they also need joined-up help from the regulators to address the root cause.

  9.  Overlay on top of these difficulties, a climate of fear from prosecutions, enforcement action and manslaughter charges and it is not hard to see how a risk-averse culture would be the resultant. There has to be a concerted effort by Government to address this issue on our railways. Drawing parallels with the aviation industry is interesting at this point. Safety is an inherent and integrated part of the aviation industry but it is not generally risk averse. Of course tensions exist across the various organisational compartments within the aviation industry but responsibilities, accountabilities and authority are carefully defined. Interestingly, enforcement action is rare and working together is more of a feature of the aviation regulatory scene. As a result tensions are more manageable, more constructive and more risk-based than we seem to enjoy on our railways. A key difference between rail and aviation is that aviation has its own safety regulatory framework based not on a framework primarily aimed at workforce safety (which I am not saying is unimportant) but focused on the specific and broad range of risks of the aviation industry.

  10.  The Health and Safety at Work Act has some important concepts to build upon and it has served the safety of workers well over the last 30 years. I am though now of the view that over time, specific legislation for railways would be beneficial to the improvement of safety, quality and efficiency and the cost-effective management of the risks. I am also of the view that it is time to review the whole Health and Safety System again, as a performance plateau seems to have been reached. Indeed an important objective must be to reduce the quantity of legislation and to simplify it wherever possible (I am however aware that this is outside of the remit of the Transport Committee). Specifically for railways, it is more important for the rail industry to benchmark against other transport modes (across the world) than to have a regulatory framework that is compatible with the nuclear and chemical industries (more about this later). There is also much to learn from the aviation and marine regulatory frameworks and the way regulatory action works within these modes.


  11.  Rail passengers must be afforded the protection of an independent guardian for safety and economy (as air passengers are). Whilst self-regulation has an important part to play, safety and economy must be independently regulated if they are to enjoy the trust of the traveling public. The key difference for rail passengers now is that the economic regulator (currently the Office of the Rail Regulator) is one government department and the safety regulator is a small part of another (the HSE). HSE's rail activities are then further spread across the HSE. A further aspect is that the HSE is primarily focused on the health and safety of workers and its forward strategy will move it even further in this direction with an enhanced focus on improving health.


  12.  As confirmed by recent stakeholder research (carried out by HSE), the HSE has not enjoyed much success since it acquired the Railway Inspectorate in 1990. Even after 13 years of ownership, railway stakeholders only rated it at 4.7 out of a possible 10 for its efforts. The detail of the research shows how the HSE does not carry the trust and respect of its rail stakeholders and there is confusion about its approach ("no clear understanding of HSE Rail organisation even from those who deal with it on a regular basis; Even those with a vague idea of an inspectorate and policy division are unclear of its functions and roles; HSE rail staff have little operational knowledge of the railways; HSE should be acting in the public interest—it is not perceived to be doing so; Many fear that HSE's approach is driven by the development of rules and that one more regulation would solve the problem").

  13.  It has also had a series of major rail accidents on its watch and it was severely criticised by Lord Cullen. Cullen considered it to be most important that HSE's leadership of its railway work be improved and recommended the creation of the post from which I recently resigned. The job design suffers from the same ailments as the industry in terms of a lack of clear responsibilities, accountabilities and authority across HSE Rail.

  14.  It is not clear who at the HSE Board carries responsibility, accountability and authority for rail matters and it could be any one or a mixture of six board members. Added to this the board does not have the normal governance arrangements of a board. This results in the board being compelled to agree things that the three strong "executive" have brought to the board. The minutes of board meetings do not record differing points of view and important issues bypass the board completely and go straight to the Health and Safety Commission. Some things, having been approved by the board, are later changed by the Commission, causing significant tensions. Board members do not get to see (let alone discuss) important work carried out by so-called board sub-committees on things like the HSE business risks, financial statements, the work of the audit committee, HSE's vision, mission and strategy etc. In summary there is a lack of clarity and corporate governance.

  15.  The board only seems to exist to dissipate responsibility of "the executive" for difficult/controversial issues—the entire board process and the governance of the HSE requires a fundamental review. The board's openness and governance arrangements were challenged in an audit by The Constitution Unit in December 2002 but very little has been done to implement the recommendations to date ("we noted the reduction in board papers made available from early 2001. We understand this reflects a change in policy, under which fewer decisions supported by such papers, are taken by the board . . . has HSE become less open? Some stakeholders were sceptical about HSE's claim to be an open organisation, and sometimes this scepticism was combined with a degree of mistrust"). This report makes interesting reading and was the subject of a somewhat rose-tinted HSE press release on 12 December 2002.

  16.  On the broader workings of the board, a fellow board member summed the situation up at a board awayday when he said he felt like a second-class member of the board. On top of this unhealthy climate, the board's general demeanor towards the rail industry is extremely negative and this tends to affect its attitude towards its own rail functions. This is felt by the staff in these functions and seriously affects morale.

  17.  HSE has, over a period of time, seriously diluted the railway experience within HMRI to a point of almost extinction (compare this to the Civil Aviation Authority). It is the only transport mode for which it regulates the safety of the traveling public and it is therefore not particularly logical for it to regulate railway safety. Views expressed to me when I first joined HSE were that railways take up too much time compared with the their core business of regulating the health and safety of workers (hence HSC/E's new strategy).

  18.  Key targets are due to be met in 2004 for the Revitalising Health and Safety initiative (launched by HSE in June 2000 for all industry sectors). Early evidence suggests that the key targets will not be met and performance will in fact be worse than before June 2000. Coupled with HSE's significant funding challenges and a comprehensive employee attitude survey this year, this will put HSC/E under further considerable pressure. My concern is that this could further distort/distract the work on railways.

  19.  There are two arguments I have heard advanced by the HSE in favour of it keeping its role for railway safety regulation—that a new regulator would not have such easy access to its specialists (human factors, safety case methods, risk assessment skills etc) and that the industry might "capture" its regulator if it was removed from HSE. The first argument is I believe easy to resolve through a trading agreement of some kind. The second argument can be addressed by placing the regulatory role with another regulator—the newly constituted Office of Rail Regulation (being created as a result of the Railways and Transport Act which received Royal Assent in July 2003) for example.

  20.  Such a move is consistent with continuing to reduce the number of compartments within the industry (indeed there are several compartments within HSE which have rail responsibilities) and it moves the industry closer to the aviation model as represented by the Civil Aviation Authority (which has ownership of the safety and economic regulatory roles). The majority view from HSE's stakeholder research is "that the railways safety regulator should not remain part of the HSC/E". In the same research, stakeholders "recognised that there are some good people within the HSE and that new incumbents were making a difference but the fear was that these people, no matter how well intentioned would not be able to impact on the total culture of HSC/E". A further compelling argument though is that the safety regulator would be bound by the ORR's duty to have regard for the economic viability of the industry (which is not a duty which HSE has other than through the concept of "reasonably practicable"). The move would give the safety regulator a fresh beginning with proper corporate governance mechanisms to ensure appropriate checks and balances in its decision-making.


  21.  The trend towards reducing the number of organisational interfaces and compartments is helpful to the achievement of a shared vision, greater focus and high performance. I believe that further opportunities could be explored, based on a careful review (perhaps by the independent National Audit Office), of how responsibility, accountability and authority are currently dispersed within the industry.

  22.  Furthermore, I believe that over time the railways would benefit from a dedicated safety regulatory framework (which would in any case need to reflect emerging EU structures and rules) to ensure the industry's (and its customers') specific needs and risks are addressed.

  23.  A useful first step could be taken by transferring HSE's rail safety functions to the newly constituted Office of Rail Regulation with safety regulation included within its purpose, role and function.

January 2004

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