Westminster Comment
Sir Robert Smith MP
Last week I used Prime Minister's Question Time to highlight the threat posed to our offshore safety regime from draft regulations proposed by the European Commission. I pointed out that our regime had been built on the lessons learnt when 167 lives were lost in the Piper Alpha tragedy.
I still remember that night tucked up cosy in bed whilst helicopters flew out and back to the disaster over my flat in Aberdeen. Out of that tragedy came the Cullen Report. Lord Cullen's report made dramatic changes to the way safety was dealt with which has lead to a regime that is respected around the world.
In the light of the Gulf of Mexico blowout the European Commission took an interest in offshore oil and gas exploration and production. In the autumn they came up with their draft regulations. The big concern for the UK is not so much the principles behind their proposals but rather the method they want to use to bring them in to operation.
By using regulations there will be a lot of extra work for the HSE in redrafting all UK regulations to make sure they are compatible. This is time that will take them away from their frontline inspection and enforcement role.
If this were to lead to a long term improvement in safety it might be worth the disruption, but since we already have evolved a safety regime the Commission respects, this will be an upheaval for no gain.
What is worse it will break the feedback loop whereby regulations evolve as the HSE applies its experience of how they operate. The Commission will be a very remote body with many distracting agendas taking their eye off the ball of monitoring the application of the regulatory regime.
Those who lived through the implementation of the Cullen report remember the immense amount of investment and skilled staff that were needed for that task. It was at time of low oil prices when those extra skills could be recruited. Now there is a world shortage of experts in offshore operations.
The EU Commission say they are not worried about the UK regime but about other parts of the EU that are less developed. There is a process that could set a high standard for the EU as a whole whilst not causing unnecessary upheaval here. That could be achieved if the regulations were withdrawn and replaced with a directive.
Given the relatively few member states that will have a direct concern over these regulations the Government is going to have to work hard to build an alliance in the EU to get these regulations withdrawn.
At Treasury questions on Tuesday I highlighted the meetings between the Treasury and the oil and gas industry. These have been set up to improve understanding of the industry following the fallout caused by the sudden tax changes in the last budget.
It will be important that this budget shows that lessons have been learned if we are to maximise the investment that supports so many local jobs here in the North East as well as across the country.
This was a theme that was returned to when there was another debate on the industry at the request of Nicholas Soames the MP for Mid Sussex. I welcomed his debate as it was a chance to focus minds at Westminster on just how important what has been achieved in the North Sea is for the whole of the country. It makes sense at a time of economic hardship to build on those sectors where we have seen success.
3rd February 2012
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