Memorandum submitted by EEF
EEF, the manufacturers' organisation, has a
membership of 6,000 manufacturing, engineering and technology-based
businesses and represents the interest of manufacturing at all
levels of government. Comprising 11 Regional Associations, the
Engineering Construction Industries Association (ECIA) and UK
Steel, EEF is one of the UK's leading providers of business services
in employment relations and employment law, health, safety and
environment, manufacturing performance, education and skills,
and information and research.
EXECUTIVE SUMMARY
This response represents a key sector of the
Environment Agency's customer base—regulated industry. Our
response is a reflection of the views of our member companies,
many of whom have dealings with the Environment Agency on a regular
basis.
We believe that the Agency is an effective enforcer,
and is very focused on enforcement as its main purpose. We would
like to see more emphasis in future on advice services for companies
trying to comply with legislation. The biggest challenge faced
by the EA is changing its perception amongst the business community.
The EA are often seen as not being pragmatic, sometimes working
against business interests and heavy handed with enforcement.
This perception must be changed in order for business to work
with the Agency towards better environmental performance. Our
general impression is that industry is increasingly being asked
to fund, through charges, budgetary shortfalls and an expanding
Agency remit at a time when the overall environmental performance
of industry is improving. The EA relationship with DTI/Defra is
one which could be improved by more effective project planning
in the run up to the implementation of new legislation. We believe
one area in which the EA has made improvements is in consultation
with stakeholders, in which are increasingly involved. We were
pleased to see an acknowledgement in the EA corporate strategy
of the improvements industry has made in reducing pollution, however,
the language used in the document is not very "business friendly"
and some of the targets set are very negative. Finally, we seek
further specific detail as to how the EA intend to drive forward
the Better Regulation Agenda.
How successful the Environment Agency has been
in its role as enforcer of environmental regulation and controls,
and how well it manages its wide range of activities?
1. EEF believe the Environment Agency (EA)
has been an effective enforcer in that the organisation takes
its enforcement role very seriously and places considerable emphasis
on this aspect of its remit. However, we also feel that the EA
is sometimes overly focussed on "policing" and can be
perceived by much of the business community as a non-pragmatic
enforcement authority working against the interests of business
rather than in partnership to deliver improvements. The biggest
challenge the EA faces is changing this perception.
2. EEF have examples of member companies
that have approached the EA for help with a particular piece of
legislation and have subsequently suffered prosecution for non-compliance.
This attitude clearly mitigates against fostering a constructive
relationship between the regulator and the regulated and creates
an obstacle to both sides working towards a shared aim of improved
environmental performance. A workable solution to this would be
for the EA to introduce a "warning system" linked to
tightly enforced improvement programmes before resorting to prosecution.
3. EEF recognises that whilst at strategic
level there have been significant developments towards greater
consistency, there still appears to be a gap between high level
policy aspirations at the EA and the service that members see
delivered on the ground by their inspectors.
Whether the Agency operates efficiently and provides
good value for money
4. It is difficult for EEF to comment on
whether the EA provides good value for money. Our views on this
matter are informed by the views of our members on the charging
regime of the EA. Although stakeholders are consulted on proposed
charge increases, these consultations generally lack both background
figures and any externally verified accounting that has led to
the decision making behind such increases. Business needs to see
what the outcome of the increased charges are as currently they
often see charges increasing with little or no justification,
and no obvious improvement in service.
5. Our general perception is that the EA
is increasingly turning to industry to fund budgetary shortfalls
or alternatively to funds such as the Business Resource Efficiency
Programme (BREW) to fund ad-hoc initiatives such as an anti fly-tipping
campaign. It is important that, if charges are to rise year on
year, some justification is provided to business, and clear improvement
in service is visible. EEF questions whether this is currently
happening.
6. As the remit of the EA expands to cover
themes mentioned in the recent corporate strategy such as "better
quality of life" and "tackling diffuse pollution",
EEF would like to see other funding mechanisms considered. It
is inappropriate to expect industry to fund such projects at a
time when the overall environmental performance of business is
improving.
7. EEF regularly seek further clarification
on the uses to which Grant in Aid from Defra can be employed.
Whilst we accept that the EA must recover some revenue from the
regulated community under "the polluter pays principle",
in some cases this concept is being stretched and business is
being asked to fund additional activities over which they have
no control. These fees amount to an additional financial burden
on business.
8. One particular current area of concern
from our members is the EA policy for recovering funds for "contentious
licensing" under the Integrated Pollution Prevention and
Control (IPPC) Regulations. Contentious licensing arises where
there is strong public opposition to an environmental permit application
from a company. This can lead to an extended dialogue between
the company, the regulator and the community. Whilst many businesses
are keen to engage with the public and build better community
relationships, EEF is worried that certain local stakeholders
may be totally opposed under any circumstances to certain businesses
located in their immediate vicinity. We therefore feel that where
the company is compliant with the law for the purposes of their
permit application and it has been demonstrated that emissions
are not having an impact, the EA should support the company. They
should make it clear to the public that the company is operating
within the law and cannot be challenged. Business should not be
forced to cover the EA costs of lengthy engagement with the general
public, when often the duration and scale of this process is out
of their control. As the public is benefiting from the use of
EA resources in these instances we feel it may be an appropriate
area in which Grant in Aid, rather than charges on companies,
could be better deployed. We also feel that on occasion this process
has appeared to be used as an alternative Planning Consent mechanism
being applied in retrospect.
9. Double charging is still an issue in
some cases. For example, in the latest EA charging consultation
for 2006-07 additional charges are proposed for "complex"
permit applications. However, this is a factor already taken into
account in the spreadsheet used to calculate permit application
fees when the application is made.
10. Problems still remain with charging
for permit variations under IPPC. Companies are charged a variation
fee even where they have made changes to improve their environmental
performance. This practise does not encourage nor reward companies
striving to reduce pollution and comply with using the best available
techniques for environmental performance.
The structure, governance and accountability of
the Agency, its relationships with Defra, Defra-sponsored bodies
and the rest of Government, including the Agency's role in the
planning system
11. We reiterate, as under paragraph 7,
that we seek clarification on the exact uses on which Grant in
Aid can be deployed.
12. We perceive that the relationship between
the EA and Defra/DTI could be improved by better planning and
communication between the two parties in the run up to the implementation
of legislation. For example, registration systems for hazardous
waste producers under the new hazardous waste regulations introduced
earlier this year were not finalised until very close to the implementation
deadline. This failed to provide sufficient time for companies
to prepare for the introduction of the regulation. In addition,
registration for producers of electrical and electronic equipment
is expected at the beginning of next year, when the Waste Electrical
and Electronic Equipment (WEEE) regulations come into force. However,
final implementation details and forms for registration are not
yet available. This situation needs to be improved in order to
give those affected by the legislation chance to plan ahead sufficiently.
13. There is also a need for more rigorous
project planning between the EA and Defra/DTI, the likes of which
appears to have been absent in recent moves to implement the WEEE
Directive in the UK. We have seen significant and recurring delays
to implementation with a lack of concrete evidence that extra
time bought by a delay is being used constructively towards workable
implementation.
The Agency's relationship with non-Governmental
stakeholders and the general public, and how the Agency monitors
satisfaction with its services
14. EEF believes consultation between EA
and stakeholders has witnessed a degree of improvement. We are
routinely invited to participate in stakeholder groups and feel
this engagement is very positive. EEF is increasingly being seen
as an important stakeholder by the EA and we feel that key agency
staff are open to building a constructive working relationship
with us at a national level. We look forward to this national
level relationship being replicated through EEF's and EA's respective
regional structures.
15. We are determined that the next step
is to ensure that EA consults with stakeholders at an early enough
stage of the process to enable sufficient time to contribute to
influencing policy. In addition, it is important to ensure that
stakeholders are not just consulted but that their views are taken
on board in order to shape regulation strategies.
The Environment Agency's forthcoming corporate
strategy 2006-11
16. EEF is pleased to see an acknowledgement
in the EA's strategy of the improvements industry has made in
terms of reducing point source pollution and emissions.
17. We feel some of the targets set in the
strategy to monitor "success" are overly negative and
do not necessarily reflect the "good" performance of
the EA. For example, setting targets for the number of successful
prosecutions is not necessarily a true indicator of progress towards
reducing illegal activity. The targeting of illegal activities
should be balanced with resources dedicated to helping industry
put preventative measures in place, thus reducing the likelihood
of prosecutable offences. These could then be replaced with more
positive milestones. An example of this would be the number of
companies receiving a site visit to aid compliance with difficult
issues.
18. We felt that the language used in the
document could be more business friendly, as this is likely to
appeal more to the business community. An example of this is the
use of the statement "being green makes good business sense".
Such a statement needs further qualifying as "being green"
is not a readily recognisable concept and is unnecessarily vague.
19. We have already outlined how one of
the biggest challenges facing the EA is changing the perception
of the agency within the business community. It is also important
that EA develop a more structured advice and warning system, to
be used as a first step before prosecution, which we believe would
improve the relationship of the regulator with business.
20. The EA should actively support businesses
where improvements have been made and where companies are complying
with the law. The EA are improving their communication with stakeholders
and EEF welcomes the opportunities to work jointly with the EA
in influencing forthcoming policy.
21. The EA could improve its "image"
by associating itself with schemes such as the DTI Manufacturing
Advice Service (MAS). This would help companies to make the link
between good environmental performance and the associated business
benefits through direct efficiency savings. It would also help
to promote the Agency as a business friendly organisation.
BETTER REGULATION
22. The EA strategy incorporates the relevant
aspects of the Hampton review and the need to move towards reducing
both the complexity of environmental regulation and of administration
burdens. Much environmental regulation remains very confusing,
full of "grey areas", is difficult to interpret, is
sometimes contradictory and suffers from overlaps with other legislation.
For example, the scope of the WEEE Directive is far from clear
for many organisations. In addition, WEEE has significant overlaps
with the new hazardous waste regulations, leaving companies confused
about how to dispose of certain waste streams. Environmental legislation
is complex and companies can be forgiven in some cases for needing
additional support to understand how to comply. This needs to
be acknowledged by the EA.
23. The financial and administrative burdens
of managing such legislation are also significant, particularly
so for small firms. EEF has encountered a number of examples of
this burden, including a small plating firm struggling to clarify
whether the business is covered by IPPC. In addition, another
business was confused about how to comply with the packaging regulations
and, to reiterate, many firms are unsure as to whether their equipment
is covered by the WEEE directive.
24. A risk based approach to regulation
is described in the strategy and we are very supportive of a move
in this direction. However, further work is needed in this area
as there is little detail in the strategy about how the EA intends
to approach this in practise. For example, by adopting a risk
based approach, a further question is posed as to whether self
regulation for the best performers is being considered. Business
would benefit from a clearer steer in this area.
25. The charging system for companies regulated
under the IPPC environmental permitting regime (EP OPRA) is often
championed by the Agency as an example of risk based regulation.
Although this is clearly a welcome move in the direction of risk-based
regulation in terms of reducing charges for the best performers,
we are yet to see an EP OPRA score translated into risk based
regulation on the ground (eg "lighter touch" regulation
for those with the best scores). It is also important that the
Agency's ambition for risk based regulation does not stop at this
point. The Agency regulates other companies that are not directly
regulated by IPPC. Therefore, we would also like to see a more
risk based approach to regulation in other areas of "softer"
decision making. For example having a warning system in place,
as described above, that is judged upon the seriousness of an
incident and both the company's previous history and willingness
to comply—rather than issuing an enforcement notice for
every non-compliance.
26. The strategy also describes an aspiration
to reduce paperwork burdens but again, the strategy contains little
detail about exactly how this will be applied and in relation
to which particular legislation. We urge EA to explain how its
ambitions to reduce complexity fit with the Defra target of reducing
administrative burdens by 25%.
EEF
December 2005
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