Select Committee on Regulatory Reform Seventh Report


List of written evidence


1Letter from Assistant Counsel, House of Commons Legal Services Office to the National Weights and Measures Laboratory 12
2Letter from National Weights and Measures Laboratory to Assistant Counsel, House of Commons Legal Services Office 13

Annex A

Letter from Assistant Counsel, House of Commons Legal Services Office to the National Weights and Measures Laboratory: request for information

After review of the above draft Order which was laid before Parliament on 20 October 2008, the following questions arise. I should be grateful if you would provide your reply to these by 24 October.

Q 1  Paragraph 21 of the explanatory document states that "it has been accepted that the term "repair", in relation to verification under the 1985 Act, extends only to action taken in respect of equipment that is not performing within the accuracy requirements of the Regulations that apply to the equipment."

Why did s.11A of the 1985 Act, as inserted by the 1999 Order, omit any reference to adjustment? What evidence is there to support this interpretation of the term "repair"?

Q 2  The Working Party on Approved Verification of Liquid Fuel Dispensers which reported on 25 March 2003 recommended that self-verification should be permitted after adjustment. Why has this not happened before now?

Q 3  Paragraph 34 of the explanatory document states that there is a burden on equipment owners, as they may be giving away free petrol if a pump continues to operate without adjustment. Is there any evidence to suggest that petrol pumps are more likely to give away free petrol in these cases, as opposed to giving less than the amount for which the consumer is charged?

Q 4  Paragraph 35 of the explanatory document states that, under the current system, there is a burden on approved verifiers when they have to arrange a second visit to adjust equipment when it can be verified by an inspector. Given that the approved verifier will charge a fee for this second visit, why is this a burden?

Q 5  Paragraph 35 of the explanatory document states that "improved ability to detect leakage should have both environmental and health and safety benefits." Is there any evidence to support the proposition that leakage from pumps which are operating within the permitted margin of error, and which are inspected according to the current system, would be prevented by permitting self verification after adjustment?

Q 6  Paragraph 38 of the explanatory document states that a further benefit of the Order would be to slightly reduce the number of journeys made by car or van, with a corresponding reduction in traffic congestion and carbon emissions. Is there any evidence to support this as a proposed benefit of the Order? If detailed evidence is not available, please provide an estimate.

Q 7  Paragraph 35 (Annex B) of the explanatory document states that if a self-verifier's fees are higher for work carried out in rural areas, then a retailer could continue to use Local Authority inspectors. Paragraphs 8 and 10 of the Impact Assessment state that a small but beneficial effect on costs is expected for small and rural retailers. As the inspector may charge a lower fee but could not adjust the equipment, how do you reconcile these two statements?

Q 8  Paragraph 5.2 of the Impact Assessment states that local authorities have received compensation for the loss of re-verification work. Please provide further details.

21 October 2008

Annex B

Letter from National Weights and Measures Laboratory to Assistant Counsel, House of Commons Legal Services Office: response to request for information

Q1: Paragraph 21 of the explanatory document states that "it has been accepted that the term "repair", in relation to verification under the 1985 Act, extends only to action taken in respect of equipment that is not performing within the accuracy requirements of the Regulations that apply to the equipment." Why did s.11A of the 1985 Act, as inserted by the 1999 Order, omit any reference to adjustment? What evidence is there to support this interpretation of the term "repair"?

NWML sought a view from its then legal adviser in the DTI in 1999, very shortly after the 1999 Order came into force and was given the unequivocal advice that references to "repair" in section 11A of the 1985 Act could not be treated as including "adjustment" (work done to equipment which is already operating within the legal tolerances to make it measure more accurately still). It is unfortunate and very regrettable that this point was not considered and addressed in the drafting of the 1999 Order: however, it is not clear to us now, almost ten years later, why the case of adjustment was not covered in the 1999 Order.

The main reason given for the DTI legal advice was that equipment cannot be said to be "repaired" unless it is first considered to be "broken" - i.e., in the context of the statutory regime for control of prescribed weighing and measuring equipment, either because it is not functioning at all, or because it is not fit for use for trade as a result of its failure to comply with one or more of the statutory requirements (e.g. as to accuracy of measurement). Since an instrument which is still functioning within legal tolerances can legally be used for use for trade, it would not be "broken", so that adjustment of such an instrument to make it more accurate than the statutory provisions require would not constitute a repair.

Subsequent legal advisers to NWML have seen no reason to disagree with the view expressed by their predecessor as to "adjustment" and "repair". Evidence in support of this view is annexed to these responses. Although the 2003 Working Group report records that "industry questions" the interpretation of "repair" as not including "adjustment" (see paragraph 16 of Annex D to the Explanatory Document), to the best of our knowledge no other legal opinion has been sought on this point, for example by an approved verifier: in more recent discussions with stakeholders, the inadequacy of the drafting of the 1999 Order has been frequently lamented, but no serious attempt has been made to dispute the legal advice given to NWML in relation to it.

Q2: The Working Party on Approved Verification of Liquid Fuel Dispensers which reported on 25 March 2003 recommended that self-verification should be permitted after adjustment. Why has this not happened before now?

Although the working party agreed that self-verification should be permitted after adjustment, when the proposed legislative change came to be consulted on as a draft Regulatory Reform Order, there was not complete agreement (see pages 12 to 15 of the Explanatory Document and the summary of consultation responses at Annex B to the Explanatory Document). NWML were advised by the Cabinet Office team dealing with RROs that the issues raised by those consultees who expressed opposition to the proposed change should be resolved before proceeding further with the proposal.

The consultation had finished in Autumn 2005. A strategy for resolving the issues raised by stakeholders was formulated in Autumn 2006 and implemented during 2007. Agreement as regards the financial implications for local authorities was only reached during 2008 after NWML and Communities and Local Government had considered further representations from LACORS on this point. Pressure on resources and the need to update some earlier work (for example, the Impact Assessment) has been partly responsible for the time taken since 2003 to reach the stage of laying the LRO.

Q3: Paragraph 34 of the explanatory document states that there is a burden on equipment owners, as they may be giving away free petrol if a pump continues to operate without adjustment. Is there any evidence to suggest that petrol pumps are more likely to give away free petrol in these cases, as opposed to giving less than the amount for which the consumer is charged?

It is inherent in the design of most pumps that, unless they are adjusted, they will dispense more, rather than less, than they say they are dispensing as their parts wear over time. This is widely known and acknowledged by the industry, trading standards and NWML.

Q4: Paragraph 35 of the explanatory document states that, under the current system, there is a burden on approved verifiers when they have to arrange a second visit to adjust equipment when it can be verified by an inspector. Given that the approved verifier will charge a fee for this second visit, why is this a burden?

The "first visit" will generally be part of a planned maintenance programme, covering all the pumps on a site. The second visit, to deal only with those pumps to be adjusted, will have to be arranged around the availability of trading standards officers. Competition between approved verifiers, who are keen to retain retailers' business, means that the fee which the approved verifier charges for the second visit may not always be such as to recover the full additional costs of the second visit and the associated "hassle factor". To the extent that the full additional costs are recovered, the burden which the current law imposes on retailers is that much greater.

Q5: Paragraph 37 of the explanatory document states that "improved ability to detect leakage should have both environmental and health and safety benefits." Is there any evidence to support the proposition that leakage from pumps which are operating within the permitted margin of error, and which are inspected according to the current system, would be prevented by permitting self verification after adjustment?

The proposition is not that using the services of approved verifiers, rather than inspectors, to verify pumps after adjustment would, in itself, prevent leakage. Rather, it is argued that permitting self-verification after adjustment would make it more likely that pumps would be adjusted more frequently, because it would be cheaper to do so, and therefore they would measure more accurately.

More accurate measurement means that leaks can be detected more easily, through the stock reconciliation process, and dealt with more quickly. This is because the more accurately a pump is known to be measuring, the more likely it is that any mismatch between the amount of fuel which it records as having been dispensed from a storage tank and the amount of fuel which is known to have been delivered to it will be indicative of a leak.

Q6: Paragraph 38 of the explanatory document states that a further benefit of the Order would be to slightly reduce the number of journeys made by car or van, with a corresponding reduction in traffic congestion and carbon emissions. Is there any evidence to support this as a proposed benefit of the Order? If detailed evidence is not available, please provide an estimate.

If a pump is adjusted and verified by an approved verifier, all the work (including the initial examination of the pump which reveals the desirability of making an adjustment) can be done in one visit to the retailer's premises, so that only one journey by car or van is involved. If a pump has to be verified by an inspector after adjustment, there will be at least one additional journey by car or van (that of the inspector), and probably also another additional journey to the site by the approved verifier if the retailer has chosen not to have the adjustment made as soon as the approved verifier identified the potential need for adjustment and it was decided to make it, but to have the approved verifier attend again at the same time as the inspector.

It is not possible to arrive at a meaningful estimate of the impact of these extra journeys, which will vary widely in individual cases depending on the location of retailers' sites relative to where the approved verifiers and inspectors are based and the other places they have to go on the same day, local traffic conditions and the vehicles used.

The most recent estimates from the Local Authorities through their representative LACORS (Local Authorities Co-ordinators of Regulatory Services), collected in January 2008, indicate that the local authorities believe that they would lose about 4,500 adjustment verifications per year. If on average 10 nozzles are adjusted on a site per visit this will mean an estimated total of 450 journeys by two individuals (the Trading Standards Officer and the Approved Verifier) totalling an estimated reduction of 900 journeys per year.

Q7: Paragraph 35 (Annex B) of the explanatory document states that if a self-verifier's fees are higher for work carried out in rural areas, then a retailer could continue to use Local Authority inspectors. Paragraphs 8 and 10 of the Impact Assessment state that a small but beneficial effect on costs is expected for small and rural retailers. As the inspector may charge a lower fee but could not adjust the equipment, how do you reconcile these two statements?

NWML considers that the proposal is most likely to benefit retailers in rural areas if they are served by self-verifying approved verifiers (see paragraphs 4.2 and 4.4 of the impact assessment, on which paragraph 8 of the impact assessment picks up). Clearly, like other retailers, they are unlikely to derive much benefit from the proposal if they still rely on verification by inspectors. However, the statement referred to as being paragraph 35 (Annex B), which we think is actually in paragraph 62 (Annex B), was our response to a concern raised that fees might increase as a result of the Order; it was not saying that it is NWML's view that fees will increase.

Q8: Paragraph 5.2 of the Impact Assessment states that local authorities have received compensation for the loss of re-verification work. Please provide further details.

When the 1999 Order came into force Local Authorities were compensated for potential loss of earnings as a result of that Order. The compensation sum was calculated as a proportion of local authorities' income for all the verification work which was then done by inspectors, including after adjustment, and was paid on that basis.

The amount transferred for each of three years (1999/00, 2000/01 and 2001/02) increased each year to take into account the decreased demand for TSO verification following the take up of approved verification. In 2001/02, the final year, the amount transferred was £668,000, of which £585,000 was the contribution to overheads, i.e. to compensate for loss of verification income. The other part of the total was for the increased inspection activity, which is unaffected by the latest LRO. The amount was transferred by PES and therefore has been part of CLG's baseline allocation ever since.


ANNEX TO LETTER: "ADJUSTMENT" AND "REPAIR"

Dictionary definitions

1. In the Oxford English Dictionary (2nd edition) the following meanings given for "adjust" are relevant for present purposes:

  • "3a. to arrange or dispose (a thing) suitably in relation to something else, or to a standard or purpose"

  • "4a. to arrange or dispose (a thing) suitably in relation to its parts; to put in proper order of position, to regulate, systematize".

2. The Collins English Dictionary (2nd edition) gives two relevant meanings of "adjust":

  • "1. to alter slightly, especially to achieve accuracy; regulate"

  • "3. to put into order".

3. The OED gives the following relevant meanings of "repair":

  • "1b. (obs) set in order, strengthen"

  • "2. restore (a composite thing, structure, etc.) to good condition by renewal or replacement of decayed or damaged parts, or by refixing what has given way; to mend"

  • "3. to renew, renovate (some thing or part); to restore to a fresh or sound condition by making up in some way for previous loss, waste, decay or exhaustion"

  • "6. to set straight, make exact (obs. rare) [only one cited usage, from 1691]".

4. Collins gives one relevant meaning of "repair": "1. to restore (something damaged or broken) to good condition or working order".

5. Leaving aside those definitions marked as obsolete, the following points emerge from the dictionary definitions:

  • "repair" presupposes that the thing repaired is broken or not in working order before being repaired;

  • if there is any question of overlap between the concepts of "repair" and "adjustment" in the context of weighing and measuring equipment, it is much more likely that "adjustment" includes "repair" than that "repair" includes "adjustment".

Statutory usage in relation to weights and measures

6. In legislative provisions dealing with mechanical or electronic weighing and measuring equipment, adjustment and repair are often both referred to, in a way which suggests that they are thought of as meaning different things. See for example the following provisions:

  • section 16(2) of the Weights and Measures Act 1985;

  • regulation 21(1)(c)(i) of the Measuring Instruments (Liquid Fuels and Lubricants) Regulations 2006 (S.I. 2006/1266);

  • regulation 8 of the Weights and Measures Regulations 1963 (S.I. 1963/1710) (as substituted by the Weights and Measures (Amendment) Regulations 1972 (S.I. 1972/767)), where it is clear that adjustments are thought of as more minor interventions which do not affect compliance with legal accuracy requirements;

  • regulation 8 of the Weights and Measures (Testing and Adjustment Fees) Regulations 1970.

7. Historically, the main focus of weights and measures law was the weights and measures themselves, rather than other "equipment". Reference was made to "adjustment" of weights and measures, presumably because this is a more natural notion than "repair" when dealing with simple objects which do not "do" anything except conform to a particular physical standard (see for example the Weights and Measures Act 1835, sections 11, 13 and 18; the Weights and Measures Act 1878, section 30).

8. Reference is still made solely to adjustment in the context of such weights and measures: see for example the Weights and Measures Regulations 1963 (S.I. 1963/1710), regulations 60 and 135 (compare the earlier Weights and Measures Regulations 1907, regulations 57, 58, 60, 68).

9. There is a long-standing prohibition on inspectors adjusting weighing and measuring equipment (i.e. mechanical or electronic devices for weighing and measuring), but they are permitted to adjust weights and measures: section 74(1) and (3) of the Weights and Measures Act 1985; compare section 12(1) of the Weights and Measures Act 1889.

10. Where legislation refers to simple weights and measures, it does sometimes refer to the process of bringing a weight or measure within the legal limits of error (as opposed to making it more accurate when it is already within those limits) as "adjustment". (See the Weights and Measures Act 1985, section 5(9) and the Weights and Measures (Local and Working Standard Linear Measures) Regulations 1986 (S.I. 1986/1684), regulation 2.) However, the concept of adjustment is nowhere invoked in relation to bringing more complex mechanical or electronic weighing or measuring equipment into conformity with prescribed requirements of accuracy.

Conclusion

11. There is nothing in the statutory usage of the terms "adjust" and "repair" which is inconsistent with the picture which emerges from the dictionaries. Putting it at its lowest, the better view (we would say the only tenable view) is that "repair" does not include adjustment "within the legal limits of error".

12. Even if it were arguable that "repair" included "adjustment", it would be far from clear that this was the case. Accordingly, the scope of section 11A of the Weights and Measures Act 1985 in its current form would be, at best, ambiguous as regards self-verification by approved verifiers after adjustment, and use of the LRO procedure to clarify the point would still be justified under section 1(5) of the Legislative and Regulatory Reform Act 2006, which provides that a financial cost or administrative inconvenience within the meaning of section 1(2) may result where legislation is hard to understand.


 
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