Select Committee on Work and Pensions Written Evidence


Memorandum submitted by the Chemical Industries Association

  1.  The Chemical Industries Association (CIA) membership comprises 140 chemical businesses and over 20 service-provider companies to those chemical businesses, across the length and breadth of the UK. We are the local, national and international voice of chemical businesses in the UK.

CIA'S ROLE WITH THE UK CHEMICAL INDUSTRY

  2.  Chemical businesses in the UK employ nearly 190,000 people. Many other hundreds of thousands of British jobs depend on the UK chemical sector. The chemicals sector has an annual turnover of £50 billion and in the last year our trade surplus was £6.5 billion.

  3.  In membership we have 130 sites that come under Control of Major Accident Hazard (COMAH) regulations. Just over two-thirds of these sites are classed as top-tier COMAH sites.

  4.  Manufacturing, handling and supplying chemicals comes with responsibilities. The UK chemical industry has a good record of health and safety amongst its EU counterparts, and safety remains a top priority.

  5.  The CIA works closely with its members on health and safety. Our role includes monitoring and reporting performance, identifying emerging issues, spreading good practice, providing practical support to companies, working with regulators to develop initiatives such as the Chlorine Covenant and Regulation and Recognition Project, and work on new process safety leadership initiatives that result from what has been learnt from incidents in the oil and fuels sector such those as Buncefield and Texas City.

  6.  Our aim is to ensure that our members' operations and products do not pose unacceptable risks to their workforce, people living or working near chemical sites, and the general public who are using chemical products every day.

  7.  A summary of our key issues include:

    —    The CIA welcomes the positive approach the HSE takes on key areas of controlling major hazard risks in the chemical industry, which is beneficial to all parties. We also support and endorse the trend in the major hazards sector towards improved engagement with stakeholders and better recognition of the views of industry in the formulation of operational policy.

    —    Based on our representation of members nationally we feel there is a need for better consistency in the implementation and enforcement of HSE's policies and procedures across the UK. We would also like to see HSE's inspection and enforcement policies recognising good performance, resulting appropriate benefits for companies that can demonstrate good and improving management of risks. Equally we recognise, and accept fully, that this should result in increased attention directed towards poor performers.

    —    The health and well-being of employees in the chemical industry is one of the core aspects of the industry's Responsible Care initiative. We support the guidance approach adopted by the HSE in tackling occupational health issues.

    —    The HSE performs a vital role and must be a priority for government budget decisions to ensure that it is properly funded to be able to discharge its role effectively. Going forward, we would like to see more consultation with industry before radical changes to the way in which it is funded are made. Furthermore, in terms of cost recovery from industry as an element of HSE funding we would like to see a wide-ranging review of charging to ensure a fairer spread of costs across all industry based on risk and performance.

PROCESS SAFETY

  8.  The CIA welcomes the positive working relationship with HSE on key areas of controlling major hazard risks in the chemical industry, which is beneficial to both organisations. This has been in evidence for several years, and led for example to the publication of jointly endorsed guidance on Developing Process Safety Indicators in 2006 and which is currently a cornerstone of managing major hazard risks.

  9.  We also welcome the current examples of good engagement of, and cooperative working between, HSE and industry, for example cross-cutting groups such as the Process Safety Leadership Group which has developed from the investigation into the Buncefield major accident. We support the current trend of looking at the causes of major incidents worldwide and applying the lessons to UK industry—for example the Baker Report into the fatal explosion and fires at the BP Texas City plant and its emphasis on Leadership and monitoring Process Safety Indicators as key factors in preventing major incidents.

  10.  CIA supports the guidance approach (as opposed to further extension of legal duties) to maintaining the highest standards of director involvement in the management of major hazard risks. This is exemplified in the HSC / Institute of Directors publication Leading Health and Safety at Work produced in October 2007. We endorse this approach that clearly sets out the responsibilities and key actions, but would not support further legalisation beyond the existing legal framework provided by the Health and Safety at Work Act 1974 and the Control of Major Accident Hazards (COMAH Regulations 1999).

  11.  Strategically, for the HSE to deliver effective control of major hazard risks whilst enabling the UK chemicals industry to be competitive, we consider it necessary for HSE policy objectives to reflect these key points:

    —    We appreciate and support the need to ensure and maintain high standards of control of major hazard installations. However, this aspiration needs to be carefully balanced against the potential cost to industry. A risk-based approach should be adopted that requires the highest standards for "new build" plant but recognises the cost implications of upgrading older plants. Where a risk assessment shows upgrades in standards at plants to be necessary or desirable, industry must be given a realistic and pragmatic timescale in which to plan for and implement such improvements.

    —    HSE should continue to offer more diverse methods of working with stakeholders, including industry, in order to achieve best practice standards in the major hazards sectors. This should go beyond simple consultation, and should include initiatives such as partnership and cross-group working to define and apply standards. There are good current examples of this, such as the successful joint development of the Chlorine Covenant between CIA, the regulators, and industry storing large quantities of liquid chlorine. The Covenant aims to raise safety standards for this very high hazard chemical from the basic legal minimum to "best practice", and aims to do so on a cooperative and shared basis over future years.

    —    HSE should ensure that its structures, allocation of resources, policies, and its procedures support and enhance consistency of enforcement and implementation of standards nationally.

SOCIETAL RISK

  12.  At the time of sending this written submission to the Select Committee, the CIA is awaiting the results of the consultation that closed in July 2007 (CD212, Proposals for revised policies to address societal risk around onshore non-nuclear major hazard installations). Without the benefit of having seen these outcomes it is difficult to comment here on what will surely be a fairly fundamental issue in terms of control of developments near major hazard installations in future years. CIA submitted a substantial response to this CD, and while it is not feasible to repeat this as part of this submission to the select committee, we feel that the following key issues merit brief reference:

    —    The CIA supports the use of societal risk consideration in the determination of development proposals near appropriate major hazard installations. The earlier that advice can be sought and obtained from HSE the better, including at the development stage.

    —    However, as a general principle, it should not be the site operator who bears the cost of any additional risk reduction measures for increases in societal risks generated that are entirely outside their control and benefit; it is not industry which is responsible for developments that bring large numbers of the public closer to the source of risk.

    —    Whilst the CIA supports the use of societal risk consideration, the issue of consistency of approach with other European countries to which the Seveso Directive applies for the control of major hazard risks needs to be addressed so that UK is not put at a competitive disadvantage.

OCCUPATIONAL HEALTH

  13.  The health and well-being of employees in the chemical industry is one of the core aspects of the industry's Responsible Care initiative—this aims to continuously improve all aspects of health, safety and environmental performance. Through this initiative, the CIA fully supports the HSC's Fit3 programme Fit for Work, Fit for Life, Fit for Tomorrow and the work done by the HSE in its implementation. This is demonstrated through our active engagement in bilateral meetings with the HSE, contributions to consultations and stakeholder workshops, and participation on the Asthma Partnership Board. The CIA welcomes the positive working relationship with HSE on key areas of controlling occupational health risks in the chemical industry.

  14.  We support the guidance approach adopted by the HSE in tackling occupational health issues and believe the solution to meeting the PSA targets for ill-health and consequent days lost per worker lies with ensuring employees conform better and more consistently to both existing Codes of Practice and Regulations; this applies to all industry sectors working with chemicals. Establishment of new regulations, or in the case of chemicals new workplace exposure limits, is unlikely to achieve effective results.

  15.  The CIA promotes good practice in our member companies by raising awareness of occupational health issues as well as also providing support. We hope due to these good practices that our own sustainable devlopment occupational health goal, to reduce the number of work-related reportable diseases, will continue to remain on track to reaching a target of 30% reduction by 2010 (relative to year 2000).

  16.  We note from the HSE Statistics 2006-07 report, that the majority of newly reported ill-health cases were attributable to stress or musculoskeletal disorders. These are just as applicable to the chemical industry sector as are health problems resulting from exposure to chemicals. Again we support the HSE's work in looking at ways to address these specific issues and encourage a partnership approach as the best way forward to promoting good practice within the chemical industry sector.

HSE BUDGET

  17.  Given the vital role of the HSE it is important that they have adequate financial settlements from Government and we are concerned by the likely cuts to their budget.

  18.  We have recently been in discussion with HSE regarding their intention to increase charges to COMAH sites by 32% in April 2008 and to charge for non-COMAH activity at COMAH sites. Whilst we acknowledge their requirement to make up a funding shortfall we do feel that there has not been:

    —    due consideration of the impact of the price hike on SMEs;

    —    enough notification to business to allow for budget planning;

    —    sufficient analysis and understanding of the extent of the increased costs;

    —    consideration of the impact they will have on the value added work between industry and the HSE; and

    —    guarantees that any increase in COMAH activity will be health and safety driven, and not by the need to raise revenue.

  19.  Going forward we would like to see more consultation with industry before radical changes to charges are made. We would like to see a wide ranging review of charging to ensure a fairer spread of costs across all industry based on risk and performance.

Chemical Industries Association

January 2008





 
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