Price of protection

The recession has left public sector finances in disarray. Most commentators agree that whichever party holds the keys to power next year, local government will change.

Already, regulatory services such as trading standards and environmental health are being directed down a new road.

The Local Better Regulation Office is suggesting a “one-stop regulatory shop”, which will mean less cost for business while enforcers try to maintain the same, or higher standards of public protection.

Meanwhile, an increasing number of EHPs are moving into the private sector and this trend is expected to accelerate in future years. While the outcome of the next general election is not a foregone conclusion, the profession needs to consider what its future would be if the Conservatives formed the next government.

In October, John Penrose, shadow business minister, wrote Regulation in the post-bureaucratic age, which lays out the Conservatives’ plans for regulatory control. Mr Penrose, who has a background in publishing, is a member of Kenneth Clarke’s team responsible for regulatory reform, consumers and company law.

One of the main criticisms of his report is that the amount of regulation has shot up” under Labour. It claims this stifles wealth creation and “weighs down innovation, community action and social responsibility, and drives up government spending on administration and inspections too.”

Individual choice

The Conservatives say that while some regulation is both “necessary and desirable”, most notably making sure that the food we eat is safe, once society is “protected from unscrupulous people and hidden dangers”, regulation should stop. In other words, within reason, everything else should be down to individual choice rather than collective control.

“It’s quite clear that there is a need for intelligent regulation and in a modern developed economy you need to have some rules,” says Mr Penrose.

“However, a lot of people would argue that [regulatory activity] is being done in a very bureaucratic way and perhaps there might be a lighter touch way to achieve the same aims.”

The Conservatives are proposing a new approach to regulation (see box, page 18). But they say “better regulation” does not necessarily equate to deregulation in every case. Mr Penrose makes it clear that many bad regulations have a sensible purpose but should be reformed so they are less bureaucratic and costly, rather than removed.

This means the powers of what the Conservatives see as “intrusive inspectors” will be curbed drastically. Businesses will be able to arrange “their own externally audited inspections” and providing they pass these, they will be able to “refuse entry to official inspectors”.

“It’s a culture change, there’s no question about that,” says Tony Lewis, CIEH principal education officer. “It’s about changing the culture of regulation, the perception of regulation and how regulation is received and how it is given.”

In this context, the concern must be that any reduction in regulation does not lead to a greater risk to public health.

The South Wales E. coli outbreak in September 2005 and the death of five-year-old Mason Jones poses the question of how can public protection be guaranteed if official inspectors are prevented from accessing premises, especially those that are run by rogue traders?

Mr Penrose responds: “When you are faced with some kind of an emergency… the rights of entry and the rights of having some hard-edged powers… to be used very, very sparingly, that is absolutely not to be tampered with.

“What we are trying to do here is avoid ever getting to that point.”

In fact, the Penrose report states that highrisk organisations will remain subject to a more structured and frequent inspection regime. Low-risk organisations, on the other hand, will face low-frequency, random and unannounced inspections. The logic is that an extremely thorough and intrusive audit at zero notice should enforce good behaviour.

But it is not simply a case of cracking down on the rogue traders. There may be cases where a medium-to-large business that is considered to be low risk, and has gained earned autonomy, then poses a serious risk to public health. Will inspectors still be able to intervene effectively to safeguard public health?

“You will be able to go in and take whatever action is necessary,” insists Mr Penrose. “[However] where you have got an organisation, which has got the right kind of internal culture, and it has also got its internal controls and systems well attuned because it’s been excellent and low risk up until then, I would expect that organisation to be much more helpful and try and fix its own problems than any rogue trader.”

Intelligence shift

Jenny Morris, CIEH principal policy officer, believes that the regulatory landscape faces a sea change. “I think what’s indicated in the paper is that there will be a significant shift towards intelligence-led regulation rather than by time elapsed since last visit,” she says.

“This will need to be based on excellent intelligence and we will need to work out how this could be sourced. Otherwise, you are likely to get to the position where you only enforce once something has gone wrong and that shouldn’t be the basis of good public protection.”

Tim Everett, CIEH director of policy, says: “You may not go in that often, but you still need good enforcement powers. The quid pro quo for the lighter-touch regulation and for being business friendly most of the time should be that when we need to intervene, we are able to do so quickly and effectively.”

One of the alternatives to red tape that the Conservatives are promoting is professional standards and co-regulation. Mr Penrose says the party will encourage professional standards wherever possible and appropriate, and consider and consult on a new model of professional co-regulation.

In practice, this means well-run businesses would employ professionally qualified experts, for example, in health and safety or food safety, to ensure that the correct internal processes and controls are in place, and that reported results are reliable.

An external member of the same profession would be paid to audit the business and to issue an audit opinion that they are satisfactory. This could then be filed with the regulator. The idea is that regulators would have a quick and evidence-driven approach to identify low-risk organisations and target their inspections elsewhere.

But what if the professional advice of the qualified expert was ignored by the company, for instance, when a commercial decision is taken deliberately, with full knowledge of the public health risks that will be incurred, simply to make a profit?

“I would expect the professional in question to react in the same way as an accountant who discovers fraud in a firm,” says Mr Penrose. “They would have a professional duty to stop it, or to inform the authorities, to avoid becoming liable themselves. I’d expect any cases of this kind to strengthen the case for professional co-regulation rather than weaken it.”

Could health and safety enforcement be a prime area for co-regulation under the Conservatives as some suspect it would? “I would look at the Health and Safety at Work Act and its original intention was broad goal setting,” says Mr Lewis.

“The paper says that goal-setting legislation is very much about self-responsibility and self-regulation but over the years since the act’s inception, all we’ve done is bring in more and more regulations to codify it on the back of what some might say are failures of inspectors.”

Mr Penrose responds: “There may be a whole range of things that could be professionalised. We want to be quite pragmatic about where this lies most intelligently and where it doesn’t. Health and safety may well be one of them but that is very much something that has to be taken on a case by case basis.” He admits the co-regulatory professional model laid out in the report will probably be more relevant to the medium-tolarge sized organisations. He says that smaller businesses will probably be more comfortable with the existing inspection approach but insists it will be at the organisation’s election not the inspectors as to how they proceed. Even so, he acknowledges that businesses often appreciate the advice that EHPs provide.

“It’s absolutely true that for smaller organisations, or those that aren’t going down the professional co-regulatory route, it isn’t just an inspection and thanks very much,” he says. “The inspector is more than that. It is often someone that they rely on for help as well.”

Undermining professionals

For Mr Lewis, one of the main areas of concern over the last 10 years has been the undermining of the EHP’s professional expertise.

He points to a speech made by Conservative leader David Cameron at a party conference a few years ago where the leader said that professionals should take responsibility because they know what is right. Mr Lewis wonders how this can be squared with the report’s approach of framing the inspectors’ duties.

Mr Penrose says it is entirely congruent if regulations are outcome-based. “If you are going to say, ‘We are going to be measuring the outcomes in terms of how much [businesses] understand what the health outcomes are that are achieved, and how you achieve it is very much up to you’, then I think you move away from the process of regulation. You restore professions to their rightful place.”

It is clear that should the Conservatives become the next government, their plans for curbing local authority inspectors’ powers and their proposals for co-regulation will have a huge impact on public sector EHPs.

“What this is about is culture change,” concludes Mr Lewis. “Doing that in one organisation is hard. Doing it in 350 disparate ones may prove more difficult. What will be interesting to see is how they intend to implement their policy on making inspectors accountable to parliament.”

Ms Morris also sees some challenging times ahead. “What we have said and will continue to say is that there is a price for effective public protection. If you don’t have competent professionals in the right places, then your level of protection will be reduced. We need to consider carefully the level of risk that will be accepted by professionals, industry and, most importantly, the public.”