Construction (Design and Management) Regulations 2015

Lord Stevenson of Balmacara Excerpts

Thursday 26th March 2015 Lords Chamber

Moved by

[Lord Stevenson of Balmacara]

That this House takes note of the Construction (Design and Management) Regulations 2015. (SI 2015/51)

Relevant document: 26th Report from the Secondary Legislation Scrutiny Committee

[Lord Stevenson of Balmacara (Lab)]

My Lords, I declare an interest that my wife is a practising lawyer who deals with construction contracts.

I should make it clear that we support the important work that the HSE does and we are obviously very keen to do what we can to support it and further improve the safety record of the construction industry. As the Olympics project showed, we can and do undertake major projects without fatalities, but 45 fatalities a year in the sector is too many and too high a price to pay.

I am grateful to the noble Lord, Lord Freud, for agreeing to take this short debate at unreasonably short notice, which is entirely my fault. I want to use the opportunity to invite him to respond to a couple of points raised by the Secondary Legislation Scrutiny Committee, which I think will be helpful in getting the message out about the changes that are being made.

I understand that the HSE policy objectives with these regulations are, according to its own documentation, to:

“Maintain or improve worker protection … Simplify the regulatory package … Improve health and safety standards on small construction sites … Discourage bureaucracy … Meet better regulation principles”.

Of course, we support all those laudable objectives.

My first point relates to the inclusion from 6 April of all domestic construction within the scope of the CDM regulations. These are negative regulations, which stem from powers in the 1992 EU directive. The Secondary Legislation Scrutiny Committee notes that the 2015 regulations remove the exemption previously given under the 2007 regulations to domestic home owners—what the committee calls “domestic clients”. The point is made that the way in which the regulations are framed and the Explanatory Memorandum rather conceal the fact that it is slightly unusual to make this major change, involving quite a large number of people across the country—who are going to be brought for the first time into a regulatory structure which, after all, has criminal penalties when things go wrong—through the negative procedure, which means that of course Parliament has no opportunity directly to discuss it, other than through this sort of format. The noble Lord may feel that I am being unnecessarily bureaucratic in that—perish the thought—but I wonder whether he might reflect on the possibility that a change of this order might better have been done either by primary legislation or through an affirmative resolution, which would have given us a chance to discuss it.

In some sense, there is no need to panic. However, I left in my house this morning two tradesmen—who amazingly turned up on time—doing some work; one a joiner and one a plumber. Long may they continue to work there and I hope that they are still there when I get back. The point I make is that I left them without any requirement to enforce any form of regulatory environment because my house, being a domestic premise, is excluded from the arrangements. However, it occurred to me as I left that, after 6 April, the situation will have changed.

Will the situation have changed or will it not? I think that it will have changed. Persons who are currently excluded under the regulations will be included; for example, all householders and anybody involving themselves with domestic work on their premises. The reason it may not have an impact, as I am sure the Minister will come on to, is that the approach taken by the HSE in dealing with the very large number of additional persons concerned with the CDM regulations is that they will be deemed to have had a process undertaken under which the responsibilities that they would have accepted under the regulations have been deemed to have been passed to the contractor. Whether the contractor knows that or not is another matter. The issue—one should be quite open about this—is that the requirements on the client which apply in commercial situations are mainly ones of organisation, notification and information, and therefore are not onerous. It would be, in ordinary parlance, quite acceptable to expect that a competent contractor would understand the issues that are raised by taking on a domestic contract and would be expected to undertake the deemed responsibilities that are going across. We arrive, as the Secondary Legislation Scrutiny Committee says, in a not unreasonable place.

I have a slight worry, however, and wonder whether the Minister might respond to this. Whereas before, 23 million or so households were excluded, they are now included, and I am not quite sure why that has happened and would be grateful if he could explain why we should not be concerned about that.

The second point I want to raise is a sector-specific concern. The Minister will be aware of the considerable concerns expressed by the creative industries and the entertainment sector. The argument is made that the creative industries engage in the construction of temporary demountable structures—for ease, I will call them TDS—which are a small but integrated part of their normal production processes and mainly involve the building of theatre and TV or film sets and the erection of marquee structures and stands within conference facilities. It is well understood within the sector that the construction of a new studio or a permanent production facility falls within the directive and should therefore be considered within the CDM 2015 regulations. However, the sector does not apply the CDM regulations to smaller scale, very temporary works and relies on a well understood risk management process and procedures that are deemed proportionate and suitable to manage the risks arising from these activities. The sector argues that it has a good safety track record and good risk management processes in place. The point at issue is that the HSE, on reviewing the situation, has decided that the CDM regulations must be applied to the construction of all temporary dismountable structures, regardless of size, scope or scale. The HSE has argued that it has no discretion on this because the UK has obligations under the EU directive. That directive is the 1992 EU directive and has not changed, so why is this happening? It would be interesting if the Minister could explain why there has been an alteration in this.

I would like to end by saying that the Minister is, I think, aware that the sector has been in quite detailed correspondence and meetings with the HSE. Indeed, I have a copy of a letter, dated 19 March, from the chairman to Pact, one of the leading bodies in the sector, acting on behalf of many of the companies involved. In the letter, the chairman says that she understands the sector’s concerns and the strength of feeling that underpins them—she certainly would not be able to miss it because there has been quite vigorous correspondence, I understand. She goes on to say, and this is the point that I want the Minister to respond to, that she shares the sector’s,

“unease about how this Directive, which fits well with mainstream construction work, is interpreted by those for whom construction work is only a small and occasional part of their business”.

In other words, she seems to be saying that she rather agrees with the sector that maybe it is not proportionate to require the CDM regulations in their full force to be applied to temporary structures, particularly film sets and the like.

We are in a bit of an odd situation here. On the one hand, the HSE is certain that it has no discretion and that the regulations have to be applied. On the other hand, it says that it sympathises with those who are concerned about having to implement the full process. They cannot both be right, so I hope that the Minister will give his interpretation. We have uncertainty looming on 6 April. Uncertainty is clearly not good for safety, and it would be great if the Minister could make a statement which reassured all the sectors concerned. I beg to move.

[The Lord Bishop of Chester]

My Lords, I have just one brief question for the Minister on the regulations. Paragraph 20 of the impact assessment refers to financial impact. It states that the deemed approach—which is much the better one, I am sure—will cost £1.3 million to homeowners and £4.6 million to contractors. All my experience is that costs to contractors get handed on to the people for whom they are providing their services, so how do we know that the £4.6 million will not simply be handed on to the homeowners to whom the services are being provided? How can one make that distinction?