The Health and Safety Executive (HSE) has inserted a service concession agreement (SCA) or clause into the contract for the new provider of the gas installer registration scheme preventing it from “taking undue commercial advantage from its position”.
The greater oversight mechanism was revealed to H&V News by the HSE after it declined to comment on the industry suggestion that it establish an ethics committee to stop the current or any future scheme provider exploiting its monopolistic position.
By selling products like CO alarms to consumers or by introducing schemes which ostensibly ape those of trade bodies, detractors have accused CORGI, the incumbent, of using its captive audience to create additional revenue streams and compete directly with gas installation businesses and trade associations.
Instead, an HSE spokesperson said: “The HSE recognises the industry has concern over a possible commercial advantage for the new scheme provider and is addressing this through the arrangements for the new scheme.
“In the competition for the new scheme, the HSE has already asked bidders to identify perceived and actual conflicts of interest and how these will be managed or avoided.
“The SCA for the new scheme [includes] a whole range of measures being proposed to prevent the new provider taking undue commercial advantage of its position.”
Under the SCA, the new scheme provider will now have to seek HSE approval before introducing any additional revenue-generating services onto the market. Authorised services would be subjected to regular benchmarking reviews to ensure that they provide installers with value for money, the HSE said.
The safety watchdog has introduced a gainsharing initiative which would ensure that any excess profits generated via the additional services are returned to installers.
|‘This is a significant move forward’|
Blane Judd, chief executive and secretary of the Institute of Plumbing and Heating Engineering (IPHE) said: “This is massive. I am pleased that the Health and Safety Executive (HSE) has decided that, in the future, the new gas registration body should concentrate on its core business of gas registration.
“It is reassuring to know that the HSE has apparently taken on board the criticisms that the IPHE, and the rest of the sector, has had in relation to CORGI working outside of its remit. This is a significant step forward.
“It is also refreshing to know that the continued concerns of the installers has been addressed, and that in the future, the gas registration body will not be able to discriminate between different registrants solely on the basis that one group has paid a fee [for a meritless service] and the other has not.
“It is our hope that as a consequence of these reforms the gas registration body, the HSE and the industry will begin to work more closely so that together we can provide a stronger registration process for the installer and hence a safer environment for the consumer.
“We believe that we now have the basic structure of a registration body that is fit for purpose. One which has the focus on ensuring that competent installers are registered rather than looking at alternative methods of increasing the financial state of the charity. These changes should also go some way towards encouraging installers who have chosen to de-register through sheer frustration and disenchantment with CORGI to come back onto the register.
“We have been asking for these changes for a very long time. I am thrilled that finally industry concerns have been heard and that we now appear to be moving in the right direction. It is time the industry had a gas registration body which is both robust and fit for purpose. This is a significant move forward.”
The new register is required to act as if it were subject to the Competition Act (1998), the HSE said, and any future provider found to be acting in an anti-competitive way could find their activities referred to the Competition Commission.
The sector applauded the reforms. Bob Towse, HVCA head of technical and safety, said: “This is great news. I’m really looking forward to this new regime to come into force. I can’t wait. We are pleased to see that the HSE has taken on board the concerns that we, and the rest of the industry, has had about the way that CORGI has been operating over the years.
“For the next five years the HVCA will be doing its utmost to ensure that the new registration body adheres to the new rules laid out by the HSE. This is a significant step forward.”
Allan Vickers, secretary of the Association of Registered Gas Installers (ARGI), said: “This sounds like a vast improvement on the old regime; the HSE appears to be taking to scheme back to basics.”
“I have a number of reservations, however. The new provider will need prior HSE approval before it can introduce additional services. How effective this measure is depends on whether the HSE will consult with industry before it makes its decision or whether it will take its own advice. The entire industry must be involved in this decision-making process for this provision to work effectively.”