Gas Work Notification Scheme
The next item of business is a members' business debate on motion S2M-3698, in the name of Andrew Welsh, on the gas work notification scheme.
Motion debated,
That the Parliament notes with concern the introduction by CORGI of a mandatory notification scheme for all new gas installations in April of this year; further notes that, whilst supporting all measures which genuinely improve gas safety standards, the Gas Work Notification Scheme does not serve to improve standards or to tackle cowboy traders, that it was conceived around the requirements of the Home Information Pack which will apply only in England and Wales and that it places a wholly unnecessary time and cost burden on Scottish registered gas installers, which in turn places an additional cost burden on their major customers, such as Scottish housing associations and local authorities, with no benefit to the Scottish customer; is concerned at the implications of the scheme for gas installers and consumers in Angus; is further concerned that the scheme was introduced by CORGI without due consultation with Scottish member organisations, and considers that the Scottish Executive should ensure that this scheme is withdrawn from Scotland.
I appreciate the opportunity to debate this motion, which has generated support from members of all parliamentary parties. It addresses an issue that affects small and medium businesses and their customers throughout Scotland. At first glance, the issue may seem relatively minor or esoteric, but the reality is that it highlights both general problems concerning devolution functions and what happens when United Kingdom quangos fail to take account of the reality of present-day devolved government.
In April this year, the Confederation for the Registration of Gas Installers, which is the UK gas safety quango, introduced a new gas safety measure throughout the UK as part of its mandate to regulate the gas industry. When gas work is done by a CORGI-registered installer, the customer receives a certificate from CORGI to say that the work was done by a registered gas installer. While that may seem straightforward, there are three problems with the system for Scotland.
Under the CORGI notification scheme, whenever gas work is done anywhere in the UK, CORGI has to be notified and receive the paperwork, along with a fee. CORGI in turn notifies the local council that the work has been done. That process is based on building regulations in England and Wales, but those regulations do not apply in Scotland. There has never been such a requirement in this country, nor has there been any indication that similar regulation will be forthcoming. The CORGI scheme also meets the requirements of the homeowner information pack, which requires certification of all gas works, but, once again, that is exclusively England and Wales legislation and it is not applicable in Scotland.
The gas notification scheme means that Scottish small and medium enterprises and their Scottish customers pay a heavy and unnecessary price in extra costs and bureaucracy for no gain in customer safety, based on regulations that do not apply in Scotland.
The first problem is obvious: CORGI is forcing English regulations and unnecessary cost burdens and bureaucracy on to Scottish small businesses and their customers. It is estimated that, to cover registration and the productivity time lost on registration, between £10 and £15 is added to the customer's bill for each gas appliance installed. Such an amount is a negligible proportion of the cost of a full central heating system, but when it is added to the cost of installing each gas cooker, fire or hob, it could, taking into account the additional VAT charged, increase the bill by as much as 30 per cent. That is especially the case if the firm provides only the labour element of the installation.
In short, Scottish small businesses are losing revenue through lost productivity time and Scottish customers are bearing additional costs due to the unnecessary implementation in Scotland of an England and Wales scheme. Local authorities and housing associations are also helping to meet the costs of implementing the scheme every time a gas appliance is installed. Over time, that will have a significant impact on the costs of and budgets for housing and other improvement schemes.
The second problem is that the method imposed by CORGI contradicts the views of the Health and Safety Executive. The HSE's fundamental review of gas safety in 2001 described CORGI's chosen approach as inefficient, cumbersome and costly. At a cost of £2.50 to £4.50 for each registration a gas fitter makes, and with an estimated 7 million to 8 million gas fittings a year, the scheme will cost between £17 million and £36 million to operate. That is money that for the most part will be taken out of small businesses; it will not add to public safety. The HSE believes
"this would be unduly bureaucratic and burdensome on industry, and would offer little safety advantages over the approach recommended."
According to the HSE report, a system in which individual installers issue the certification would be better, as it would be more cost-effective and easier to operate.
I commend the work done by the Scottish and Northern Ireland Plumbing Employers Federation and the Heating and Ventilation Contractors Association. SNIPEF, which represents the vast majority of CORGI-registered gas installers in Scotland, and the HVCA say that the scheme simply increases the cost to the consumer of any gas work and offers none of the safety benefits of a self-certification scheme. In short, the scheme has been identified at UK level and in Scotland as ineffective in increasing public safety and costly for consumers and tradesmen.
The third problem is the straightforward lack of consultation in Scotland. When I instructed my researcher to contact CORGI board members in Scotland to determine what level of consultation had taken place, he found that not one Scottish member of CORGI had been consulted prior to implementation. After that, I asked him to contact the other CORGI council members, as advertised on the CORGI website, to ask them what level of consultation took place. Out of the 16 responses he received, only four stated that they had been consulted. Of those four, only three were in favour of the scheme.
In addition, it was unclear from our research whether what was called consultation was genuine or was simply a fait accompli. The simple fact is that none of the bodies that represent Scottish interests were consulted prior to implementation. That clearly indicates that the scheme did not take the interests of Scotland into account.
To recap, I have three main concerns: the scheme flies in the face of HSE recommendations; it is based, in part, on legislation that is not applicable in Scotland; and there was a complete lack of consultation north of the border.
What can be done? I look forward to hearing positive proposals—and to action—from the minister today. First, I recommend that the scheme be withdrawn from Scotland in its entirety and replaced with something that is more amenable to the industry, which has recommended another approach. Secondly, proper consultation should be undertaken in Scotland to determine the needs and desires of all of the stakeholders in the gas industry in Scotland, from the consumer to the tradesman. Thirdly, the HSE's recommendations should be followed. Fourthly, there should be greater involvement by ministers and elected representatives, to ensure that unelected UK quangos are aware of the reality of devolved government and the needs of Scottish businesses and consumers.
My speech is not anti-CORGI; CORGI does a tremendous public service. I want only to correct an existing and obvious problem: we need a scheme that is less bureaucratic, meets HSE standards and is of less cost to small businesses and the consumer. The sooner such a scheme is introduced with the agreement of the industry and its representatives, the better.
I am happy to speak in this debate, just as I was happy to sign Andrew Welsh's motion when he explained the issue to me. As he said, the issue is fairly esoteric, but I understood it at the time and felt that it needed to be addressed. Nevertheless, I do not think that I could have written an essay on the subject after signing the motion, so I am grateful to SNIPEF and the HVCA for giving me a briefing on the subject, which means that I now know a lot more about it.
As Andrew Welsh said, the charge was introduced without any consultation. It is not clear to me what purpose it serves in Scotland. For example, I would be interested to learn what Scottish local authorities do if they are notified. It seems to me that notification serves no purpose other than to add to bureaucracy and the bits of paper that are flying around.
The charges do not seem to be much, but the industry assures me that, when staff time and so on is factored in, they can amount to £16 to £20. In the context of an entire heating system, that might not seem much, but it is quite a lot to pay if only a cooker is being installed. Further, of course, the charge is levied not only on private companies but on bodies that are funded from the public purse, such as local authorities and registered social landlords. There is an issue about what we are paying this money for and why we are paying it at all.
It is clear that the scheme was devised with the situation in England and Wales in mind. It dovetails reasonably well with the information pack, but it does not seem to dovetail at all with the seller's information in Scotland. Nor does it include any element of quality control. In fact, there is a danger that the scheme might act against quality control because only CORGI-registered firms will have to go through it. I hesitate to use the term "cowboy", but outfits that are less well regulated and are of lesser quality will not be obliged to go through the process, which means that they will be able to charge less. I would hate standards to be driven down as a result of the scheme.
As Andrew Welsh said, CORGI does a good job and it is important that firms are registered with it, but the charge is levied only on initial installation, not on service. It just does not seem to make any sense.
Our small firms in this area of work have enough difficulties. They have difficulties getting involved in the Government's central heating schemes, of which I am supportive. I would like small, local firms to be able to take part in those schemes a lot more. I do not think that they need any extra burdens.
There is an issue in the fact that the scheme was drafted at UK level. I do not fully understand the advantage of it even at the England and Wales level, but it clearly meshes in much better with the legislation there. In Scotland, the scheme is simply an extra bit—a blister on the side of other regulations that it does not relate to at all. It is pointless, punitive and illogical. If, through negotiations with Westminster and whatever the appropriate route is, we can get rid of the scheme, we will be doing our tradesmen and their customers a big service.
I was Scottish manager of the Gas Consumers Council for some 12 years. Driving up standards in the gas installation industry was key to our remit at that time. I do not intend to rehearse what Andrew Welsh said so eloquently.
The CORGI scheme is overbureaucratic and costly, and it is perhaps not the way forward. Self-certification of installations, such as is conducted in the electrical contracting industry, is probably the way forward, but it is not simple in this case. It is possible for someone to install an entire central heating system apart from one element—the connection to the gas supply—without being CORGI registered. The registration relates to the connection to the gas network. Who takes responsibility for the installation and who signs off the certificate is a key component. Often, the person who carries out the first maintenance check has to certify that the whole system is working correctly. Self-certification is the way forward, but it is not as simple as it might be in the electrical contracting industry.
The need for CORGI to take account of the Scottish dimension is one of the areas in which there needs to be some change. In my time, it used to do that. I do not know what has happened since, but there has probably been some misunderstanding of the situation in Scotland. The Gas Safety (Installation and Use) Regulations 1994 have always applied throughout the UK, but building standards have not. Appliance installation instructions and British standards have applied across the board. There is some difficulty because of building regulations, but CORGI should be aware of that and it should have consulted more widely than it appears to have done.
It is fair to say that Scottish consumers should perhaps have had a better deal. Energywatch lost the role of looking after gas appliances and customers' interests when the change from the Gas Consumers Council took place. If I am wrong about that, I apologise, but I believe that that is the case. If it is the case, it is something that energywatch should be given the authority and resources to take up again. We used to apply considerable pressure to the industry by pursuing court cases when there had been negligent installation.
Does the member accept that, when a United Kingdom quango deals directly with an English ministry, there is a danger that it forgets the reality of devolution? I have found that our small businesses in other aspects of industry have been affected, too. This is a wake-up call to say that the reality of devolution is such that Scotland should be consulted automatically.
I accept what Andrew Welsh says. I do not understand what happened within CORGI, but there is a lesson to be learned.
Appliance installation is vital. A gas installation is a safe and efficient installation if it is properly installed. If it is not properly installed, the consequences can range from some cost and inconvenience to the consumer to a potentially lethal situation in a domestic dwelling.
Having seen the results of carbon monoxide poisoning—whether prolonged illness with no explanation, someone being overcome and taken to hospital on two or three occasions before being correctly diagnosed as having carbon monoxide poisoning, or a fatality—I understand very clearly the need for the highest of standards.
Although I accept what Andrew Welsh said, I do not know whether there is a ready solution to hand. There is a solution, but gas installations must be safe and efficient.
I congratulate Andrew Welsh on securing the debate. I was happy to sign the motion, for which he obtained cross-party support before lodging it with the chamber desk. Although it refers specifically to Mr Welsh's Angus constituency, I believe that that was a device to get the motion through the chamber desk; the issue is relevant to all Scotland. I congratulate him also on the comprehensive case that he made for the change mentioned in the motion. In fact, he addressed the issue so comprehensively that he has not left me much to say.
The issue might seem to be esoteric and of little interest—the chamber is not exactly packed this afternoon—but it is important for the people who are involved and so seems to be an appropriate subject for a members' business debate. I will be interested to hear what the minister has to say in response. Given that we are about to go into our Christmas recess, it is also appropriate to be discussing issues about the heating of our homes.
The introduction of the gas work notification scheme has placed more administration on registered gas installers, and that means more costs for local authorities, housing associations, customers and people right across the country. I am sure that everyone in the chamber would agree that the last thing that Scottish gas consumers need is higher, unnecessary administration costs, especially when there has been such a rise in energy prices across the board.
The scheme was introduced by CORGI in April 2005. It seems ludicrous that a scheme based on building regulations in England and Wales and aimed at installers there has been imposed on registered installers across Scotland. I would be interested to hear whether the minister thinks that that is right when Scottish building regulations do not require such a notification scheme. The gas work notification scheme does nothing to improve the safety standards for gas installation in Scotland, as is stated in the motion.
It would be interesting to hear about the Scottish Executive's contribution to any consultation in advance of the scheme's introduction and whether it expressed any views to CORGI. What action does the minister propose to take to try to resolve the issue? To be fair to the minister, I am not sure what locus the Executive has in this particular matter. As far as I am aware, CORGI is not a statutory body; it is a confederation of gas installers. However, I would expect the Deputy Minister for Enterprise and Lifelong Learning, as someone who is concerned about the impact of regulation on business, to be able to make representations to a private body and to express the concerns of Scottish businesses. The Parliament is about promoting the Scottish economy and that is a stated aim of the Executive. If the scheme is inappropriate and unnecessary, the Executive should be doing what it can to have it removed. There is no need to put additional costs on gas installers north of the border or their customers in the public and private sectors.
There is genuine cross-party agreement that the gas work notification scheme is inappropriate and should be withdrawn from Scotland. We must have high standards, but contractors and consumers are being unfairly penalised by the application of a scheme designed to meet requirements in England and Wales. With the evidence that is before us, it seems to be folly to continue with the scheme.
Christmas is coming. Would it not be a nice present for the gas installers of Scotland, and their customers, if the Executive was to ensure that the scheme is removed?
I join Murdo Fraser in congratulating Andrew Welsh on succeeding in getting the issue debated. I accept that it is probably not of major interest to everyone, but it is obviously of considerable importance to the people who are affected—but more of that later.
I have listened with interest to and noted the views of those who have taken part in the debate. I am also aware that four employer representative organisations that are CORGI council members—including the Scottish and Northern Ireland Plumbing Employers Federation, to which several members referred—were not content with the way in which CORGI introduced the gas work notification scheme. Such was their discontent that one of the four organisations submitted a claim for a judicial review of CORGI's decision, but the judge rejected the submission on the basis that CORGI had the vires to promulgate the scheme. Although the judge thought that—as Andrew Welsh mentioned—CORGI's consultation could have been more detailed, the judge also decided that the consultation was not sufficiently inadequate.
I do not agree with Andrew Welsh's fundamental analysis, but he is to be commended for his tenacity in keeping the issue alive through his parliamentary questions and today's debate.
The case to which the minister referred took place in the English courts. Is he not concerned that the fundamental problem is that United Kingdom quangos have not understood what devolved government means? If they continue to deal directly only with English ministries and ministers, there will be a problem. Is the minister happy to allow English building regulations to determine what happens in Scotland? Was he consulted?
That question was also asked by Murdo Fraser. We had no input to the consultation process. I will deal in due course with the other two issues that Mr Welsh has raised.
The message that I am trying to convey is that my officials have tried to be supportive throughout. They have kept in regular contact with the Health and Safety Executive in an attempt to gain a satisfactory solution. I hope that Andrew Welsh will accept that.
We are all keen to support measures that improve gas safety standards. That should go without contradiction. However, if I may answer the question that Murdo Fraser asked, the Scottish Executive does not have the legal competence to take action directly by withdrawing the scheme from Scotland in the way that the motion suggests.
Putting those matters to one side, we need to consider the detail of the scheme—as ever, the devil is in the detail—before we consider the differences of opinion between CORGI and some gas installer organisations. The Greens suggested that the scheme was a pointless punitive measure, but Euan Robson took a more measured approach. It is fair to say that CORGI believes that, thanks to five factors, the scheme will help to tackle the problem of work being done by non-registered installers and will increase the credibility of registered installers.
First, the tightening up of the inspection process for registered installers will enable CORGI independently to select work for inspection rather than rely on installers identifying inspection sites. Secondly, the scheme will make it more difficult for illegal, non-registered installers to practise. The declaration of safety will enable CORGI to reinforce key safety messages and to increase consumer awareness of the need to use a CORGI-registered installer. Fourthly, the scheme will aid product recall and ensure that comprehensive, accurate information on installations and replacement work is available. Finally, it will assist with the identification and rectification of risk factors, such as common problems with installing a particular product, and will ensure that a comprehensive, accurate and centralised record of the work that has been undertaken is available. I put it to members, as reasonable men and women, that those are potential advantages to both the Scottish consumer and the industry.
UK installer bodies, including SNIPEF, believe that the scheme is flawed such that it will have no impact on the extent to which non-registered installers operate—as Andrew Welsh mentioned—and have expressed their concerns directly to CORGI, of which they are members.
CORGI is approved by the Health and Safety Executive to operate the statutory registration scheme for gas installers under the gas safety regulations to which Euan Robson referred. The HSE sets broad criteria under which the registration body—which, in this instance, is CORGI—should function, but it is open to the registration body to determine the detailed arrangements under which it operates its registration scheme.
That is how it should be. The criteria require CORGI to be constituted with a board of directors that is accountable to a "principal representative body"—the CORGI council. That arrangement was put in place specifically to give organisations the opportunity to play a significant role in furthering gas safety and in representing their individual members. As a consequence, CORGI may carry out its activities free of control or interference from the HSE, subject to the criteria and its public law obligations. To respond to the specific point that Andrew Welsh made, most of us agree that that is how it should be.
The Health and Safety Commission summed up its view on CORGI's completion certificate scheme as follows:
"We believe that this would be unduly bureaucratic and burdensome on the industry and would offer little safety advantage."
Those comments strike me as pretty straightforward. Is the minister placing no weight on the Health and Safety Commission's views? Although he has no legal powers to intervene, he has the ability to gather together those involved in the industry in Scotland to try to thrash out a solution that is more suited to the Scottish situation.
Minister, you are entering your last minute.
I crave your indulgence, Presiding Officer. Because of the complex nature of the debate, I would like to see it through to its conclusion. At the scheduled end of my speech, I will say something that relates specifically to the issue that Andrew Welsh has raised.
I have set out the relationship between CORGI, gas installers and the Health and Safety Executive. I take my relationship with all three very seriously. I have been advised that CORGI's core reason for introducing the gas work notification scheme is to enhance gas safety and that it was not solely conceived, as has been argued, around the requirements of the home information pack. As members have said, those requirements apply only in England and Wales, under the terms of the Housing Act 2004.
Irrespective of the position that one takes on the issue, the Housing (Scotland) Bill contained provisions, which we recently approved, that will allow ministers to make regulations prescribing documents that will have to be provided to potential buyers when a house is marketed in Scotland. The precise nature of the documents to go into purchaser information packs has yet to be developed.
Even if there is still a difference of opinion on the core reason for the introduction of the scheme, we need to accept that, in practice, all home owners can be pressed to provide information about gas installations in their homes when they offer them for sale. That is a salient point. In my view, it suggests that the gas work notification scheme is of benefit to all home owners, irrespective of whether they are located in Scotland, England or Wales.
It is not for me, other ministers or the Health and Safety Executive to intervene. The HSE says that the introduction of the complete safety initiative and the gas work notification scheme is a matter for CORGI, its council members and members of the registration scheme. As I mentioned earlier, SNIPEF is a member of the CORGI council.
I thank Andrew Welsh for raising the matter for debate. I welcome the recent announcement by the HSE that it will undertake a new gas safety review and sincerely hope that all those who have an interest in the issue will have an opportunity to feed their views into the process. Recently I met Lord Hunt in London to discuss the matter. I spoke to him again only yesterday. He will be happy to consider, in conjunction with the review, the views that members and I have expressed in the debate.
The review will examine whether the current regulatory arrangements continue to provide an appropriate and—to respond to a point made by Murdo Fraser—cost-effective means of securing gas safety. A cost-benefit analysis will be carried out. The work will be taken forward through three research projects, one of which will review CORGI, focusing on the part of the organisation with which the HSE is concerned—the registration scheme for gas installers.
I hope that the review, the process and the research that has been instigated will address all members' concerns. They will have the opportunity to feed into the process. My officials and I will keep in close contact with the HSE in Scotland as that work progresses. I encourage everyone else to do likewise.
Meeting suspended until14:15.
On resuming—