Examination of Witness (Questions 180-199)
28 OCTOBER 2004
MR JOHN
HOLBROW
Q180 Chairman: How many cases of that
type come up through the legal helpline.
Mr Holbrow: We do have statistics,
but I do not have them to hand. We will look at that and let you
have them.
Q181 Mr Challen: Do you get any direct
help from the Environment Agency to communicate with your members
about environmental offences at all?
Mr Holbrow: Not direct financial
help, but we do have speakers along at some of our branch meetings
and regional meetings. The Environment Agency are very good in
providing speakers at meetings when we request them.
Q182 Mr Challen: I am intrigued as to
how you see your role, whether it is a proactive role in helping
to educate members not to commit environmental crimes or whether
to defend them, to provide a legal advice line and help them,
as it were, to get off the hook.
Mr Holbrow: Not the second one
of those. We spend an awful lot of our members' money in raising
awareness and providing legal information. We believe the information
is there, and we provide details of how they may access that information.
What we cannot do is to force them to do it.
Q183 Mr Challen: Do you think the Environment
Agency should be doing more with you to promote understanding
of environmental crime, and if so what sort of things should they
be doing? Have you been to them and said, "we think you should
be doing this or that to help us"?
Mr Holbrow: We do have regular
meetings with the Environment Agency, as to what services they
can provide for small businesses. As I said before, the NetRegs
one is a very good system, and we were involved in detailed
discussion with the Environment Agency when NetRegs was set up,
as to what small businesses needed from it. We think that that
is a very good system. However, we feel that what needs to be
done earlier in the day, when new legislation is coming in, is
to give small businesses the information.
Q184 Mr Challen: How often do you meet
with the Environment Agency? Do you have regular meetings?
Mr Holbrow: Yes. We have a slight
difficulty at the moment in that our policy development officer
who attends these meetings has recently left the Federation, and
until we get a replacement early in the new year, there may be
a small period of time where the meetings are not so regular.
We welcome these meetings with the Environment Agency to exchange
views.
Q185 Mr Challen: Just to exchange views
though, not to talk about how you can practically get to grips
with this problem.
Mr Holbrow: Yes. We do talk about
what they plan to do, and we ask them to do things that we would
like to see in terms of raising awareness. I keep coming back
to that, because it is the raising of awareness by all parties
that is important. Unless they are aware, they will break the
law often without realising it. It is this whole question of raising
awareness that is the real key, where the Environment Agency,
Government departments, the Small Business Service and all agencies,
including ourselves, can help raise awareness.
Q186 Mr Challen: We have already discussed
that there are some kinds of business that probably have a greater
propensity to cause environmental damage, and it may well be that
they are less likely therefore to be members of your organisation.
I think that is probably true because they are not very responsible
to start off with. Do you try and communicate with particular
sectors, or is it simply through your magazine and your website?
Mr Holbrow: It is still our magazine
but we do look at particular sectors when particular legislation
comes out—for instance, we responded to the White Paper
on fly-tipping and talked to a number of our members in the building
industry. I liaised with the chairman of our construction policy
committee on this whole question of fly-tipping. Again, we get
anecdotal evidence that it has been dealt with properly, but other
anecdotal evidence came out to say it has not been dealt with
by small businesses properly. We like to think that people who
have taken the responsibility of joining an organisation like
ours are not in the forefront of fly-tippers.
Q187 Mr Challen: Do you monitor the use
of your legal advice line or the other help that you provide legally,
to see what kind of offences have been committed, and to see if
there is a pattern?
Mr Holbrow: We monitor regularly
the queries that are referred and the telephone calls that are
made. As I said earlier, I can provide you with that information.
We do not monitor prosecutions unless they come through our legal
advice line service.
Q188 Chairman: You are chairman of the
environment committee, are you not?
Mr Holbrow: Indeed.
Q189 Chairman: How often does the Committee
meet?
Mr Holbrow: We meet as and when
required. We meet two or three times a year to look at overall
policy, but we meet on a regular basis on particular legislation.
Q190 Chairman: So you have ad hoc
meetings as well as regular meetings.
Mr Holbrow: We have ad hoc
meetings. We have focus groups and take ourselves away for a whole
day. We get people who are involved with particular pieces of
legislation. We have done that recently with environmental liability,
which has just come to Westminster having come out of Brussels.
We are also at the moment doing the detail on the REACH regulations,
which are still in Brussels; but we need a small business voice
raised on that. We would have specific companies that have the
problem along for a focus group, take all day over it and then
come up with information which we will then use for lobbying our
point of view.
Q191 Chairman: Do you think there are
too many environmental regulations?
Mr Holbrow: I think they need
to be more focused. They are scattered a bit like confetti. It
would be better, I feel, for the environment, if they were more
focused. To give you an example, I would maintain that the Climate
Change Levy is a tax-raising levy rather than having a (marginal)
effect on the environment. I have yet to meet anybody who has
done a great deal when faced with the Climate Change Levy, which
is involved with making environmental change. They may change
their supply to reduce their costs—talking about small businesses—to
actually make a significant change. Therefore, I think the environmental
legislation needs to be focused on making a benefit to the environment.
I think our members would go along with that more, rather than
just seeing it as a tax. One can add aggregates tax in that as
well.
Q192 Mr Francois: There is a lot of scepticism
about the Climate Change Levy, as you quite rightly say, as to
whether it has environmental benefits or whether it is a tax.
There is an additional issue, is there not, that in some cases
smaller companies are unable to qualify for the 80% abatement
that larger companies can then negotiate on.
Mr Holbrow: Yes, indeed.
Q193 Mr Francois: That is my impression,
but since you are here is that correct?
Mr Holbrow: Yes, that is correct.
We do have some members. One comes to mind: I was speaking the
other day to a baker who is a member of the FSB but also a member
of the Federation of Master Bakers. They have a negotiated agreement,
so although he is a small company he can get his 80% reduction
from the negotiated agreement on the basis of the big users. We
do have other businesses around, but the majority of small businesses
cannot enter into negotiated agreements because they do not have
the number of big companies in the same sectors. This is the problem.
Q194 Mr Francois: You said it yourself,
so we cannot be accused of putting words in your mouth. The general
view is that basically it is just a tax.
Mr Holbrow: Yes, and this is not
just an opinion. We have done a survey a year after the Climate
Change Levy came out of small businesses, to see what their attitude
was and which sectors were affected, because some are affected
more than others—hotels and restaurants are affected, where
they have small numbers of people but they do not get the rebate
of the payments and they do have very high costs. They were quite
adamant in the survey that they see it as another tax. If you
want to join in the game, then that is a tax you have to pay.
The only way they see of mitigating it is to negotiate with the
energy suppliers to see if they can get on to a lower tariff.
Combined heat and power plants, which also give you an advantage
under the Climate Change Levy, are not appropriate for small businesses.
In the area I come from, the local council does a lot of work
on providing combined heat and power plants, but that is used
to go to very large businesses, because you would not invest in
a combined heat and power plant just for a small business—it
is not economic.
Q195 Mr Francois: I do not want to get
too bogged down, but would it be the view of the FSB that you
would like to see the levy markedly amended or scrapped?
Mr Holbrow: Scrapped preferably
or amended if possible.
Q196 Mr Francois: With regard to this
whole matter of regulations and fines, we have had submissions
from other parties that there is a general feeling that some regulations
are just too complex and unworkable, and that they almost have
a perverse incentive of encouraging some companies to break the
law because the whole thing is such a mess. What is your view
of the overall state of regulation? Can you give us some idea?
Mr Holbrow: I think regulations
need to be looked at more carefully. There is scope for de
minimis levels to help small businesses, or in Brussels derogations
of small businesses; but ministers and the Commission seem to
set their minds against it because they can point to a few instances
where a small business does do an awful lot of damage. There is
scope for change in the whole area to help small businesses. As
I say, it is not just the environmental businesses that are the
problem; it is that added onto other regulations.
Q197 Mr Francois: Do you think the current
levels of fines are effective deterrents to those who get caught?
Mr Holbrow: No. Again, while not
condoning significant increases in fines, it is not looked up
on as being a deterrent. Some of our members even report that
they see blatant things going on; they report it, but nothing
appears to happen. It is not saying nothing does happen, but nothing
appears to happen, which is one of the complaints I hear going
round the country. All the regulations are there, but if people
break them, the level of fines is not seen as a deterrent.
Q198 Chairman: Yet you said you would
not condone a significant increase in fines.
Mr Holbrow: No, because it is
an increase to business costs.
Q199 Chairman: It is an increase in business
costs for businesses that do not behave properly, but what would
you recommend instead?
Mr Holbrow: I think one has to
increase awareness. It is this whole question of increasing awareness
of the regulation and a light touch from the Environment Agency
to point out the error of people's ways, rather than necessarily
coming down with heavy fines.
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