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London Economics, 11-15 Betterton Street, London WC2H 9BP, UK November 28, 2006
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November 28, 2006
Evaluation of cumulative impact of Evaluation of cumulative impact - - PowerPoint PPT Presentation
Evaluation of cumulative impact of Evaluation of cumulative impact - - PowerPoint PPT Presentation
Evaluation of cumulative impact of Evaluation of cumulative impact of Evaluation of cumulative impact of safety, health and environmental safety, health and environmental safety, health and environmental regulation on various chemical sectors:
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Objectives of the project Objectives of the project Objectives of the project
Estimation of costs of compliance with current SHE regulations in excess of minimum costs necessary to ensure current levels of protection in 3 sub-sectors of chemical industry:
- Industrial coatings
- Aerosols
- Specialty chemicals
Proposals for reduction in costs of compliance with current SHE regulations while maintaining current levels of protection Toolkit for future studies
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The target sectors The target sectors The target sectors
Industry Turnover (£bn) Industrial/decorative coatings 1.4 Specialty – organics 8.7 Specialty – inorganics 2.9 Specialty – soaps 2.9 Specialty – other 1.7 Aerosols 1.2 Mixture of very large firms and SMEs
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The target regulations The target regulations The target regulations
In total, package of 16 SHE regulations to be assessed jointly:
Hazardous waste classification and waste disposal COMAH Packaging and packaging waste regulations Carriage of dangerous goods including DGSA CHIP/Dangerous substances/ dangerous preparations Dir. Biocidal products directive/regulations IPPC/Pollution prevention and control regulations Solvent emissions regulations COSHH regulations Management of health and safety at work regulations Cosmetics regulations Food contact regulations General product safety regulations The reporting of injuries and dangerous occurrences – RIDDOR Health and safety (first aid) regulations
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Method Method Method
Primary data collection
- Face-to-face interviews with representatives of 48
companies (different size), with opportunity by survey participant to review write-up of interview
Estimation of total costs of compliance and excess cost of compliance
- Use of information from interviews and grossing up to
generate sector-wide estimates
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Challenges Challenges Challenges
Industry involvement and support
- Support of 3 trade associations (British Aerosol
Manufacturers’ Association, British Coatings Federation, British Association of Chemical Specialities
- n steering group with DTI, Defra, Cabinet Office), Dti,
Scottish Enterprise and DETI in NI
- but…….
- Participation issues (90 names but only 48 participants)
- Response issues (information available to respondents)
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Key elements of questionnaire Key elements of questionnaire Key elements of questionnaire
Identification of entity to which response applies (plant, company’s UK operation, world- wide operation) Questions about:
- Overall cost of compliance, as % of total turnover
(multiple choice approach)
- Specific costs in absolute terms (staff salaries, other
time commitments, equipment, other plant or process costs, external advice and testing, charges imposed by the regulator, fees for permits and inspections, foregone business, changes to products, changes to labelling, other)
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Key results Key results Key results
Average total cost of compliance with SHE regulations in 3 sectors: 2.1% of turnover (range
- f 0.9% to 3.1% across 10 industry
classifications) Average excess cost: 0.6% of turnover (range of 0% to 1%) Compliance costs roughly constant across firm sizes within industry groups
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Key results Key results Key results
Weighted cost of compliance: 1.20% of turnover Weighted excess cost: 0.4% of turnover
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Key results Key results Key results
An important feature in interview process was asking companies to think of activities they would not undertake in the absence of regulations (issue of baseline) => reduction in estimate of compliance costs Insurance, reputation important drivers
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Key benefits Key benefits Key benefits
5 main areas:
- Better SHE performance
- Greater efficiency in handling waste
- Benefits of visits from regulators
- Improvement of company’s reputation (consumers,
general public)
- Forces companies to analyse production processes
systematically
- Level playing field - no race to the bottom
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Key benefits Key benefits Key benefits
Many proposals for:
- Better implementation of current regulation
- Changes to regulation
- Changes to process of producing regulation
Perhaps more interesting aspect but also source
- f tension with regulatory bodies