It is almost 20 years since the original Construction (Design and Management) Regulations (CDM 1994) came into force, and while the construction sector has become safer since their introduction, they also gave impetus to a whole other ‘industry’ based on assessing the competence of organisations and individuals – an issue that remains a bugbear. With CDM now under review, Louis Appleby considers what practitioners can expect from the Regulations’ forthcoming revision.
Owing to the individual complexity of building projects and the tough working conditions that prevail on many sites, the construction industry is rightly regarded as one of the most hazardous industries in which to work.
It is not only safety where the risks are considerable – the industry also suffers from a high incidence of occupational ill health, with more than 5000 occupational cancer cases a year;1 and an estimated 74,000 total cases and 31,000 new cases of work-related ill health.2 The effects can be devastating for the individuals concerned and their families, as there is often a long-term impact on quality of life and financial security.
Employing more than 2 million people in the UK, the construction industry has witnessed a significant reduction in its fatality rate over the past 20 years3 – a decline that has corresponded with the implementation of the Construction (Design and Management) Regulations 1994. The 2007 version of these laws is now under review and the form they will take must influence and facilitate future improvement.
Pre-qualification and competency assessment
The Construction (Design and Management) Regulations 1994 (CDM 1994) were put in place to improve health and safety in the construction industry, with a particular focus on effective planning and risk management. All duty-holders are required to satisfy themselves that those whom they engage or appoint are competent to deliver work safely, do not endanger others, and meet the necessary legal health and safety requirements.
The CDM Regulations place justifiable importance on competence, placing specific responsibilities on those appointing organisations or individuals to carry out reasonable checks that they are competent to do the relevant work. Conversely, those accepting such appointments should only agree to do the work if they are sure that they are competent to carry out the required tasks.
Assessments of competence should focus on the needs of the particular project and be proportionate to the risks and complexity of the work. It is also worth mentioning that assessing competence is an ongoing process – just because an organisation or individual is judged to be competent to deliver one contract doesn’t necessarily mean it is competent to deliver the next one that comes along.
Most suppliers undergo some form of pre-qualification (PQ) or ‘stage 1’ assessment when tendering for work. The CDM 2007 Approved Code of Practice (ACoP) included a set of ‘core criteria’ in appendices 4 and 5, based on the requirements of the Management of Health and Safety at Work Regulations (MHSWR) 1999, against which competence should be assessed.4
The ‘core criteria’ provide clients and contractors with a benchmark of what suppliers should be doing to achieve basic health and safety standards, and a clear illustration of what ‘good health and safety’ looks like. The ‘core criteria’ are not intended to be another pre-qualification scheme in their own right, but rather a means of helping to eradicate the confusion and administrative burdens associated with the plethora of PQ schemes in the UK.
While it is widely accepted that ‘core criteria’ provide an invaluable guide for ‘stage 1’ assessment, clients and contractors should not lose sight of the fact that further inquiries should be made at ‘stage 2’ to ensure that those whom they engage are fit and able to execute the work when they arrive on site.
A tangled web
Since the introduction of the CDM Regulations, we have seen the emergence of a multitude of PQ schemes, each holding favour with different clients and contractors. While the need to ensure competence is undisputed, the proliferation of these schemes across the industry has led to an increase in bureaucracy, red tape and additional expenditure.
The problem arises when clients are signed up to a particular PQ scheme, and then stipulate that assessment under the scheme is a requirement to tender for their work. Suppliers then find themselves in the predicament of having to spend time and money being assessed against different schemes with similar standards each time they tender for work. There has been much criticism of the waste and duplication this incurs, with the estimated costs to industry amounting to £250 million a year.5
Realistically, the ideal approach would be for the industry to push for uniformity and to base their respective PQ schemes on an industry standard based on ‘core criteria’. This would remove duplication and allow schemes to co-exist. It is an approach that has long been aspired to– indeed, the notion of a single construction industry scheme was first recommended by Sir Michael Latham in his 1994 report, ‘Constructing the Team’.6 But this ambition has never truly been realised, not least because most PQ schemes are too well-established, or have too great a commercial value to concede to a single overarching scheme.
Following the HSE-funded Carpenter Report in 2009,7 we saw the emergence of Safety Schemes in Procurement (SSIP) – a major drive towards PQ harmonisation across the industry. The report established operating protocols and suggested standards for the membership of an umbrella organisation, via which member schemes mutually recognise each other through a ‘deemed to satisfy’ agreement. Member schemes must also adopt CDM ‘core criteria’ for the basis of their competency assessment process. While most SSIP members promote integration, there are some exceptions, not least some certification-scheme members who operate a one-way deemed-to-satisfy agreement, whereby they recognise other SSIP members’ PQ schemes but do not reciprocate acceptance of their own standards.
There are other inhibitors that the industry needs to resolve; for example, the cost of SSIP membership varies largely according to which scheme is adopted by the client. Each scheme charges a fee, as well as requiring contractors to pay for annual validation audits – this may account for the reluctance from some quarters to change, owing to commercial factors and self-interest. Arguably, the industry itself is causing duplication, as there appears to be reluctance from major contractors, which are poorly represented on the SSIP membership list, to accept mutual recognition and, instead, a preference to continue focusing their resource on managing their own supply chains.
Drawbacks aside, the SSIP has gained prominence in the past few years and has 36 members at present – a clear indication that the industry is moving in the right direction. A notable step forward came in October 2010, with the launch of the Publicly Available Specification (PAS 91) for pre-qualification questionnaires in construction-related procurement. The specification provides buyers with a yardstick for PQ questions to test supplier compliance against ‘core criteria’. At present, there isn’t much incentive for suppliers to achieve this benchmark; however, in time, it may become the British standard for pre-qualification in the construction industry.
Increased pricing pressure
The economic downturn has resulted in CDM-related work being carried out under difficult circumstances, with pressure to get projects completed within tight financial budgets. This has led to a situation where price is often considered more important than competence. A recent survey commissioned by Constructionline,8 which interviewed 105 construction buyers from a range of sectors, found that only 29 per cent put health and safety accreditation at the top of their list when selecting a contractor, compared with almost half who put cost as their top priority.
It is completely understandable that everyone is closely monitoring their costs, but it is equally important to ensure that those appointed to do the work are competent to do so. Buyers can make a real difference and make a significant impact on their direct costs by pre-qualifying those who have been assessed by an SSIP member scheme. If buyers fail to do this, resources are diverted away from sensible risk management and towards needless paperwork and cost.
Time for change
In April 2012, the HSE published its evaluation of the Construction (Design and Management) Regulations (CDM 2007).9 The evaluation – a recommendation included in the Löfstedt Report – highlighted some positive aspects of CDM, as respondents commented that they find the Regulations useful, and said the definitions of competence in appendices 4 and 5 provide a sound basis for competency assessment.
While there are key elements of CDM competency that add value, the evaluation report also highlighted areas that do not work so well, such as the number of questions asked in pre-qualification questionnaires; having to repeatedly complete similar questions; the generic nature of the questions in relation to specific competencies required for a project; the proliferation and cost of PQ schemes; and the requirement of public-sector clients to create large quantities of paperwork.
Public-sector organisations procure under strict EU procurement rules, which prohibit organisations from revisiting the questions that were asked during pre-qualification. As such, their PQ processes may be relatively lengthy, which manifests in large numbers of generic questions that are usually very similar to the questions organisations have already answered for other procurement processes, or competence assessment schemes.
The evaluation report also highlighted concerns about too much emphasis being placed on generic stage-1 assessment, rather than specific stage-2 assessment of the competence needs of the project. It is argued that this could result in suppliers being appointed without having the core competencies to execute the project, or the project team coming in several months down the line and not being the original team proposed for the project.
Other issues highlighted included poor understanding of project requirements among different parties in the supply chain; competency assessments being too difficult for small, infrequent, or one-off clients or contractors to implement; and too much focus on paperwork and not enough observation of organisation performance, or past experiences. The industry is clearly expressing a mood for change, and given the current economic climate and the challenges facing business, those changes can’t come soon enough.
So what next for competency assessment?
Tying in with the Government’s agenda to reduce red tape, a review of the CDM Regulations is already underway. The HSE is expected to consult with the construction industry throughout 2013, with any new CDM regulations coming into force in April 2014 at the earliest. The consultation exercise is likely to use the findings of the CDM 2007 evaluation report, which should steer policy development towards retaining the aspects of CDM that truly add value.
In June last year, HSE Chief Inspector of Construction Philip White reported that the CDM review will bring the existing 140-page Approved Code of Practice (ACoP) into alignment with the corresponding 20-page EU Temporary or Mobile Construction Sites Directive (TMSCD) 1992 – the requirements of which were implemented, in part, through the CDM Regulations.
The TMSCD aims to promote better working conditions on work sites and requires safety and health considerations to be taken on board during the design and organisation of projects. It also provides for the establishment of a chain of responsibility, linking all the players involved, in order to reduce risks.
However, one particular concern about the Directive is that it puts less emphasis on competence, which could be considered detrimental to health and safety.
The HSE Chief Inspector of Construction stated that the CDM regulations go beyond the Directive in the area of competence, and therefore place disproportionate requirements on its assessment and verification, which adds little value to health and safety outcomes. One problem with this is the unnecessary paperwork associated with PQ; therefore, scheme providers are encouraged to request the minimum amount of documentation in order to demonstrate compliance. The documentation also needs to be evidence-based and relevant to the type of work for which they are tendering.
Small sites are disproportionately represented in the official accident statistics, and the challenge to provide an effective regulatory framework for these sites remains substantial. With an estimated 5000 cases of occupational cancer and 31,000 new cases of work-related ill health in 2011/12 alone, it appears that competence may help reduce accidents but is having little effect on preventing workers from getting ill.
Whatever replaces CDM 2007 must facilitate the provision of practical and proportionate advice, not least to influence small construction projects, which are in most need of good advice. Guidance must also be focused towards tackling occupational ill health.
The construction industry is awash with pre-qualification providers, who place a huge burden on the financial and administrative resources available. It is clear that the industry can’t continue down this path and that these resources would be better targeted at tackling occupational ill-health issues and freeing up time to spend on stage-2 checks. Perhaps we will see the birth of a dedicated standard, or the nomination of a single PQ provider run by the HSE, similar to the register for consultants? With the challenges facing the industry as a whole and the Government’s continuing commitment to austerity, there has never been a better time for change.
1 HSE (2012): Research report 931 ‘The burden of occupational cancer in Great Britain’ – www.hse.gov.uk/
2 Labour Force Survey (2011) – www.ons.gov.uk
4 Construction (Design and Management) Regulations 2007 – Appendices 4 and 5
5 National Specialist Contractors Council (NSCC) – www.nscc.org.uk/support/
6 Latham, M (1994): ‘Constructing the Team’, The Stationery Office
7 HSE (2010): Research report 723 – Safety Schemes in Procurement Competence Forum (SSIP-C Forum) – www.hse.gov.uk/research/rrhtm/rr723.htm
9 HSE (2012): Research report 920 – Evaluation of the Construction (Design and Management) Regulations 2007 – www.hse.gov.uk/research/rrhtm/rr920.htm
Louis Appleby is an occupational health and safety advisor for the Balfour Beatty Workplace / North Tyneside Council Partnership and currently serves as the vice-chairman of the Newcastle Construction Safety Group (NCSG).
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