APPENDIX
Case Study of UCG Member's Costs of Labour
and Environmental Regulation
This case relates to a West Midlands painting
and plating plant, employing 38. This evidence relates to health
and safety regulations (Control of Major Accidents COMAH, and
Major Accident Prevention Policy MAPP), and environmental protection
(Integrated Pollution Prevention and Control IPPC, Control of
Asbestos at Work Regulations, ISO14001, and Best Available Techniques
BAT as required by the Environment Agency). The company estimates
that the costs of these regulations are about £40k a year,
for both 2003 and 2004 for this division, which employs only 38
people. This figure amounts to as much as 5 per cent, approximately,
of direct wage costs.
The Managing Director also notes that the 5
per cent figure would have been near-zero 10 years ago, when COMAH,
IPPC, BAT, ISO14001 and Asbestos regulations did not exist. As
he says: "In fact we recollect that ten years ago our regulatory
activity was just beginning and was at sensible levels; the cost
to the business was negligible and it is in the last five years
that activity and costs have mushroomed."
It is the large change in the company's costs
over such a short period which gives pause for thought. Of course,
there is a benefit side to these stricter health, safety and environmental
regulations. We do not—and cannot—attempt to quantify
such benefits. Yet, was our level of regulation so wrong five
or 10 years ago? The answer must surely be, "No", in
which case the situation is now one of over-regulation.
The company of which this painting and plating
business is a part has been established in the West Midlands for
a hundred years. It has plants in France Germany, Belgium, Poland
and China. It is the Polish and Chinese parts of the business
which are now expanding, due to their lower costs. Over-regulation
will drive business out of the UK.
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