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March 15, 2011

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IOSH 11 – HSE chair outlines plans for cost cutting and recovery in challenging times

The goal for the HSE in the coming year – in the wake of Lord Young’s review of and recommendations on health and safety, and in view of the government spending review – will be to continue to look for opportunities to improve its efficiency and make cost savings – but not at the expense of inspection and regulation of high-hazard sectors.

This was the unequivocal message of the regulator’s chair, Judith Hackitt, as she addressed delegates at IOSH 11 this morning (15 March). Describing the 35-per-cent cut in the Executive’s budget as “no more harsh than that applied to other bodies within the DWP” Ms Hackitt pointed out that the HSE is already making significant cost savings and efficiencies towards this target.

She explained: “In a significant proportion of the work we do we already fully recover our costs from those we regulate – in the major-hazard sector, for example. Also, moves like the closure of our corporate activities in London and consolidation in Merseyside, and the fact that 200 staff recently accepted our voluntary exit scheme – we will continue to investigate further rationalisation of our estate, and cutting back on back-office services in order to save costs.”

She was adamant, however, that inspections in the high-hazards sectors will not be cut but instead, the regulator will look to “modernise” its approach. Ms Hackitt continued: “We won’t change how we do reactive work, i.e. based on our incident-selection criteria and the complaints process. But in some sectors, the number of inspections will inevitably have to go down. Therefore, we will need to target proactive inspections even more on the basis of risk and cost-effectiveness, and by comparing them with other forms of pro-active intervention that can work more effectively than inspection.”

Cost recovery is a subject currently exercising stakeholders and the HSE chair was upfront about its plans in this area. She explained: “It is true that we are working in proposals to charge those who are not managing the risks they create – that is, charging them for the work the HSE has to do to make sure they are compliant. We think this is fair and equitable, and that the majority of businesses will see it as taking away the competitive advantage their non-compliant rivals have had for a long time.”

Ms Hackitt acknowledged, however, that such a system will need to be “transparent and open to scrutiny” and that consultation will be carried out before any system is ready to go – which, she suggested, would not be for another year, or so, at least.

She also reassured delegates who may have been concerned about reports that the Executive was looking to recover costs via its intellectual property that there is “no intention of going back on the decision to make all of HSE’s guidance freely available”.

Summing up, the HSE said that a good deal of change was to come – already, she said, there has been “a welcome change of culture away from they myths and nonsense, which was boosted by Lord Young’s report, but we are not there yet on this front”.

On the subject of Lord Young’s recommendations, Ms Hackitt reiterated the HSE’s commitment to following through those within its remit while working within the constraints of the spending review. The Executive would, she concluded, remain committed to its strategy released more than two years ago: “Be part of the solution is our road map and we don’t intend to change it. We will continue to share a common purpose with you all to prevent deaths, serious injuries and ill health at work.”

Click on the video below to see highlights of Judith Hackitt’s comments on how the HSE is dealing with having its budget cut.

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