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July 8, 2013

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SME spend on external help with health and safety compliance soars

“Sweeping changes” to health and safety laws due to take effect in October should see a more significant drop in the time and costs expended by SMEs in ensuring they are compliant.

This is according to the Forum for Private Business (FPB), whose research of 4000 of its small-business members, published today (8 July), found that internal costs of health and safety compliance have dropped slightly, from £3.8 billion in 2011 to £3.7 billion this year but outsourcing to specialists leapt up by 43 per cent.

Health and safety is the third biggest source of small firms’ compliance expenditure, after tax matters (£6bn) and employment law (£4.7bn). At seven hours a month, it is  the second biggest consumer of time, after employment law (12.2 hours a month) and before tax matters (6.3 hours).

Internal time spent on overall compliance matters is down by 6.8 per cent but money spent on external consultants is up by 19 per cent, from £5.8bn to £6.9bn. According to the FPB, this does not suggest an overall reduction in regulation, “so the Government must maintain momentum with the regulatory reform agenda and strive for both a cost and time reduction in compliance”.

Regarding the big increase in spending by small firms on external H&S specialists specifically, the Forum said the reason is unclear but cited “HSE-accredited providers charging more” as a possible explanation. According to its research, the average cost per firm of external health and safety support is £1146.

The Forum welcomed the slight fall in the internal costs of health and safety compliance and claimed they would fall further in October, when “sweeping changes to workplace health and safety are implemented”.

Asked by SHP to elaborate on these changes FPB policy advisor Robert Downes said the Forum specifically meant the end of strict liability, adding: “This will mean firms can’t be held responsible for accidents beyond their control.”

When it was pointed out that employers will still have to comply with their legal duties to protect the health and safety of their workers, Downes insisted that the “massive change” that is the removal of strict liability “will change the whole culture by making staff more aware of their own responsibilities”.

The Forum said it would also like to see an assessment of the need for businesses with five, or more employees to have a written risk assessment. According to its data, over the last two years the gap between businesses with fewer than five employees and other, larger micro-businesses has increased.

For this reason, it said, “it is important to assess the impact of this requirement in case it is a barrier to business growth and a reason for some businesses not to employ additional staff”.

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Adrian Plimmer
Adrian Plimmer
7 years ago

You can see what’s going to happen now. Firms will just blame their staff for accidents. H&S law needs clarity, insurance companies have to be restricted with their ‘claims culture’, and H&S professionals have to go out an win hearts and minds. Otherwise people are going to die and be injured needlessly.

7 years ago

Dear oh dear.

Communication, communication, communication. Clarity required. Always lacking in any H&S misunder-reading.

Thanks Dave . . . (the PM in case you don’t know).

7 years ago

Firstly, at last someone has mentioned that SMEs pay more on tax and employment matters than health and safety!!!

Finally, the increased use of consultants in my view is due to the continuing confusion caused by the present Government’s approach to health and safety legislation.

Martin Bevan
Martin Bevan
7 years ago

.If businesses want a level playing field, then all business should have a safety statement and written risk assessment. The size of the business has no relevance to safety and health it’s the risk that their activity may produce

7 years ago

I wonder what compliance costs come after the 3rd placed H&S? Environmental? I can’t really think of many others. Its no shock to see H&S is below tax and HR, and I really don’t think its such a burden for a small firm to spend 21 minutes a day on H&S – so it has little to do with the perceived ‘confused regulation’ of the coalition government. Stop avoiding the truth – small firms are not burdened with any H&S manacles, the majority don’t do H&S properly because they don’t have to. End of.

Rob Slater
Rob Slater
7 years ago

IMO what this change will do is to muddy the waters where any negligence actually comes from – is the employer at fault for not doing as much as reasonably practicable or is it truly out of his control. My fear is that many companies will see this as a get out and will do less than they are atm.Small firms will think they no longer have to do any HS which will leave so many people exposed to unnecessary hazards.

One more example of this Gov’s lack of foresight or consequence