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October 7, 2010

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European Agency backing for economic incentives schemes

Economic incentive schemes encouraging companies to invest in risk prevention are a cost-effective option for governments seeking to reduce the numbers of work-related accidents and illnesses, according to new research by the European Agency for Safety and Health at Work (EU-OSHA).

Many EU Member States already offer various kinds of financial reward for businesses that invest in keeping their employees safe, says the Agency. These rewards range from lower insurance premiums, state subsidies and grants, through to tax breaks and preferential terms for bank loans for the best-performing businesses.

Three out of 14 case studies highlighted in the EU-OSHA project provided sufficient data to conduct a cost–benefit analysis. All three resulted in a positive payout ratio, ranging from a return of 1.01-4.81 euros for every euro invested. Quantitative criteria covered accident rates, sick leave, and general improvement in working conditions.

For example, an incentive scheme introduced in the German butchery sector in 2002 led to a 28-per-cent fall in reportable accidents over the following six years compared with a 16-per-cent fall in the sector as a whole. In total, this amounted to about 1000 fewer accidents each year in incentivised companies.

The EU-OSHA report includes a review of existing research on economic incentives, an overview of government policy in different EU Member States regarding reward schemes, and a collection of case studies giving details of how incentives have been used in different European countries and sectors. The study also evaluates the effectiveness of different incentive schemes, and identifies common success factors.

As a result of the project, the Italian workers’ compensation authority INAIL has developed a new incentive scheme, which takes into account the experiences and good practice of other countries. With a budget of over 60 million euros, the INAIL scheme is particularly targeting SMEs and, according to estimations, could lead to savings of 180 million euros at societal level.

EU-OSHA director, Jukka Takala, said: “All in all, the report shows that economic incentives can be effective in all Member States, regardless of wide differences in terms of their social security and accident insurance systems.”

The report, which was launched at a conference of the International Occupational Hygiene Association in Rome on 29 September, plus a factsheet in 22 languages are available from a new web portal on economic incentives:

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13 years ago

Hi we are a major power company who are to embark on arc flash mitigation programme for our Uk plants

Is there any incentive scheme availble for funding such activities and driving this incentive forward, i was reading the article on SHP about the use of such schemes can you advise please