Construction lawyers are awaiting with interest the outcome of a legal challenge to HSE’s Fees for Intervention due to take place in the summer.
The cost recovery scheme, introduced in 2012, charges any company that breaks health and safety laws the costs for inspection at £129 per hour.
But the legality of the scheme and its appeals process is set to be questioned with a judicial review being brought by facilities management firm OCS in an attempt to have its Fees for Intervention bill overturned and the HSE’s current system for deciding appeals quashed.
The company, alleges that the HSE acts as “prosecutor, judge and jury” during its procedure for challenging a notification of contravention – the formal notice that triggers an FFI bill.
Keith Morton QC, instructed by Mike Appleby of Fisher Scoggins Waters, is acting for OCS Group, with the firm arguing whether the retrospective process for establishing the legitimacy of an FFI notice complies with natural justice, the principle that a person cannot be a “judge in their own cause” and that a defence must always be fairly heard.
Kevin Bridges, partner at Pinsent Masons, said: “A lot of people in the industry are keenly watching this court case, there’s no suggestion the scheme will be scrapped but the result could have a big impact for companies and construction.”
This news follows on from data released earlier this month by law firm Pinsent Masons that found in the last year the HSE charged businesses £15m under the scheme, an increase of 23% from £12m the year before.
Even with the £15m recovered, according to HSE accounts and data complied by Pinsent Masons, the costs of administering the scheme have also been high. The scheme fell short by £2.7m in 2015/16, which represents an increase of 53% on the shortfall of £1.8m for 2014/15.
Bridges added: “There are concerns that Fees For Intervention is encouraging the HSE to intervene with more businesses to generate more revenue to close that gap, although there appears to be no evidence that the gap is in fact closing.
“There is also limited scope to challenge the costs the HSE imposes and as appeals are heard by the HSE itself, many businesses decide to just pay up. This leaves them potentially vulnerable in the event of future legal disputes as it could be cited as acceptance of poor health and safety performance.”
HSE spokeswoman said: “Before FFI was introduced in 2012, regulatory work relating to workplace health and safety was funded by the Government, rather than by those who create the need for such work by operating outside the law. HSE has continued to focus on the proportionate management of risk in the workplace and not on the level of FFI income recovered.
“In 2015-16, HSE raised invoices amounting to £14.7m of the £17.4m total cost of the regulatory work, which was previously funded by the taxpayer. The actual cost of the regulatory effort was £2.7m higher than that invoiced to dutyholders under FFI. This cost represents all aspects of HSE’s work not just the administration cost of running the scheme, which is a very small element of the overall cost of FFI.”
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Interesting logic from the HSE’s spokeswomen, which If followed to its conclusion, for example, would lead to the costs of the police force being paid for by those who create the need for one, similarly the health service; except we already do through corporate and personal income tax.