Intelligence Briefing - 27 May 2011

Published: 27/05/2011

IN THIS ISSUE - Minister pressed on compensation culture - BIS lobbied on WEEE - EEF in the news - Weekly focus - invitation to focus groups on mandatory greenhouse gas reporting - Week in review - Week ahead


Minister pressed on compensation culture

In a constructive meeting with Chris Grayling MP, Minister for Employment, we welcomed the government’s work to reform health and safety law and take the profitability out of the compensation system, but warned it is missing a critical issue.

Health and safety paperwork requirements are now driven far more by the compensation system than by regulation. Unless documentation of systems is perfect, lawyers, insurers and the courts tend to settle compensation claims – regardless of the action taken to actually manage risks. Addressing this is essential in reducing the bureaucratic burden. Mr Grayling was receptive to the issue; both he and EEF will be pursuing the matter with the Ministry of Justice.

For further information, contact Steve Pointer, Head of Health and Safety Policy.

BIS lobbied on waste electrical and electronic equipment

We met with BIS officials this week to present a paper, backed by some of the UK’s major electrical and electronic equipment manufacturing trade associations, outlining our concerns and solutions on waste electrical and electronic equipment (WEEE). The meeting comes as officials prepare for the second reading of the so-called WEEE Directive in the European Parliament later this year. With the government committed to “copying out” Directives to avoid gold-plating it is more essential than ever that concerns are addressed in Europe before transposition into UK law.

EEF warned government about the pitfalls of an open scope without clear and concise exemptions, the implications of targets based on electrical and electronic equipment placed on the market and advised on the most cost-effective approach in meeting higher collection targets. The government has committed to work closely with EEF during second reading and we are now preparing to take our case directly to MEPs and the Commission later in June and again in the autumn.

For more information, or to feed into policy discussions and planning, please contact Susanne Baker, Senior Climate and Environment Policy Adviser.


The week began with the first official data on bank lending since the the Merlin Agreement where our response was picked up by the Daily Mail, Daily Telegraph and Guardian. Later in the week our response to the latest GDP figures was reported in the Daily Mail, Guardian, FT (registration required) and on the BBC website. The latter also featured news of a welcome boost from companies from a pick up in the US. Finally our Chief Economist, Lee Hopley, was interviewed on the BBC News Channel with along with Business Secretary Vince Cable MP on the Merlin bank lending story.


Invitation to focus groups on government plans for mandatory greenhouse gas reporting

As the government opens a consultation exploring the case for mandatory greenhouse gas reporting, EEF is inviting members to participate in focus groups to consider the ramifications. Under the Climate Change Act, the government has an obligation to introduce regulations mandating corporate reporting of greenhouse gas reporting or put before Parliament an explanation for not doing so.

In advance of this, the government has opened a consultation exploring options. It has put forward four possible scenarios:

  • Mandate under the Companies Act for all quoted companies. This would capture 1,100 companies.
  • Mandate under the Companies Act for all large companies - between 17,000 and 31,000 companies in total.
  • Mandate under the companies all those captured under the Carbon Reduction Commitment Energy Efficiency Scheme. This would cover 4,000 companies against a threshold of 6,000MWh of electricity use, but if the threshold was lowered could be expanded to cover 15,000 companies.
  • Stick with a voluntary reporting framework

If a mandatory approach is adopted, those manufacturers that are caught would have to report all greenhouse gas emissions that arise from production sites and those that arise as a result of the energy they buy. There will also be pressure to report on “significant” other sources of greenhouse gases – those that companies aren’t directly responsible for may have some control over, such as emissions resulting from employee travel to work, any emissions generated from the use of their products, from key suppliers or from third-party distributors. Third-party verification of the data is also likely to be required.

The consultation document acknowledges that many companies are already collecting data on their greenhouse gas emissions in order to comply with other policies. It seeks views on whether mandatory greenhouse gas reporting offers the opportunity to simplify the climate change policy landscape.

The consultation is just eight weeks long and the deadline for submission of comments to Defra is 5 July.

EEF will be responding to the consultation and we invite views and thoughts from members to help shape the response from the manufacturers’ community. If you wish your views to be reflected in our response please submit comments by 17 June. In order to distil responses and verify our position, EEF will be holding a focus group on 21 June.

If you would like to participate please contact Susanne Baker, Senior Climate and Environment Policy Adviser, by Friday 10 June.




Public Sector Finances

Public sector finances worsened in April, with borrowing significantly higher than had been expected as a result of stronger government spending, and slightly weaker tax receipts . T he deficit was the largest April deficit on record.




The figure for GDP growth in the first quarter of 2011 was unrevised, at 0.5%. Although household spending and business investment fell, net trade improved considerably.



Business investment

Business investment fell 7.1% in the first quarter of 2011. Manufacturing investment also fell, by 1.2%. However, investment by manufacturers was 14.8% higher than at the same point in 2010.



GfK NOP Consumer Confidence

The GfK NOP consumer confidence index jumped steeply in May, rising ten points to -21. This was the second-largest one-month rise in the survey’s history. There are several temporary factors such as the Royal wedding and bank holidays which could have contributed to this, so it remains to be seen whether this will be sustained.


Wednesday 1 June: Manufacturing PMI, lending to individuals

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Trade Body of the Year, Public Affairs Awards 2011; Best Rebrand by Sector - manufacturing and Best Implementation of a Rebrand