BCC QUARTERLY REPORT
AUGUST, 2006
ENVIRONMENT
Energy
The
need for reform of the European energy market to establish common contractual
conditions for industrial customers was raised by the BCC at the first meeting
of the Government’s Business Energy Forum in July. A formal note was subsequently submitted to
the Secretary of State for Trade and Industry.
The
Energy Intensive Users Group also submitted to the Energy Minister an analysis
of the impact on manufacturing industry of uncompetitive energy prices. Reform of the market was required to maximise
the use of import infrastructure, provide common contractual terms for all
customers within the European market, and increase UK gas storage facilities. A Parliamentary reception, attended by 50
industry representatives and some 40 MPs including the Energy Minister and the
Chairman of the Trade and Industry Select Committee, emphasised the gravity of
the current situation.
As a
consequence of these actions the Energy Minister has now committed the DTI to
seek a meeting with the European Commission to discuss the need for common
contractual terms, which the industry has identified as a key factor in
effective reform. In addition, the
Government’s Energy Review Report, published the day following the Parliamentary
reception, went some way towards addressing the need for additional gas storage
capacity.
A
limited number of BCC member companies are participating in a group gas
contract established through Utilyx to provide gas at a stable price. The objective of a price below 60p per therm
for the first year has been achieved.
Negotiations are continuing on a longer term arrangement. There will be opportunity for companies not
yet committed to the contract to participate in the New Year.
EU ETS / CCA
Most
ceramic sites will first participate in EU ETS from January 2008, having opted
out of Phase I. The BCC is continuing to
press the UK Government to exercise the option to exclude sites with an output
below 75 tonnes per day. There is some
indication that this objective may be achieved, thus removing some 40 sites
from the scope of the scheme.
Concern
remains about other aspects of the implementation of Phase II. The use of an inappropriate benchmarking
methodology would necessitate the purchase of trading allowances by most sites
to enable them to meet their CO2 cap. The
removal of allocations for closed sites replaced by more efficient plant would
deny companies an incentive to commit to such improvements. The parallel operation of EU ETS and climate
change agreements without relief from the main requirements of the latter is
unacceptable. Urgent discussions with
Defra on all of these issues are continuing.
The third milestone year for
climate change agreements ends on 30th September, 2006. All participating members must report their
performance for the year to the BCC by early January 2007.
IPPC
Permit
applications for up to 20 ceramic sites remain unresolved 27 months after the
closure of the application window. The
local authority unit at Defra is assisting authorities in addressing problems
by defining the intended scope of the ceramic industry guidance document. At the same time Defra is undertaking a
mid-term review of the guidance. Site
visits have been carried out and discussions are proceeding on the agreed
recommendations of the review.
Further
sections of the industry BREF document have been made available for comment in
anticipation of publication of the final document in the New Year. Discussions have opened with Defra and the
Environment Agency to prevent any disadvantage to UK ceramic companies that
could arise following the limited involvement by UK regulators in the BREF
negotiations in Seville.
Waste Management
The European Commission is
developing a communication giving examples of by-products that should be
regarded as waste under current European case law. At the same time a debate is taking place on
the inclusion in the proposed revised Waste Framework Directive of a definition
of by-product, and procedures for clarifying when a waste can cease to be
regarded as such. Defra will consult
shortly on the revision of the UK regulations providing exemptions from waste
management licensing. The consultation
will include consideration of the submission on this subject made by the BCC to
the Better Regulation Unit.
These developments should
provide opportunities to promote the case for the relaxation of waste
management licensing controls on the use of certain alternative materials in
production, which currently act as a barrier to recycling.
ROHS Regulations
The Restriction of Hazardous
Substances Regulations, effective from 1st July, 2006, may be interpreted in
such a way as to restrict unduly the permitted lead content of ceramic lamp
bases and clocks constituting part of electrical equipment. The need for a proportionate approach to
enforcement is being pursued with DTI.
In parallel an application to the European Commission is being prepared,
for submission through Cerame-Unie, for specific exemption from the Directive
for ceramics. A number of exemptions
have already been accepted, including one for lead in crystal glass.
Minerals Planning Guidance
MPS1 and its accompanying
annex on planning for brick clay are expected to be published in
September. The protracted delay appears
to stem totally from within DCLG, agreement on the content of the document
having been reached some considerable time ago.
The BCC has repeatedly stressed to DCLG and other parties that the
position is unacceptable.
Monitoring of Brick Clay
Agreement has been reached
within the Other Minerals Group of the SEERAWP on the format for collection of
the information required by the South East Regional Planning Authority from
companies on brick clay consumption and reserves. The agreed procedure should ensure the
provision of accurate information without the excessive demands on companies’
resources. It is hoped that the
precedent will be followed by any other region opting to undertake such an
exercise.
Mine Waste Directive
The Mine Waste Directive was
made in May for implementation within two years. All minerals operations will require a permit
under the Directive in due course.
Detailed discussions with the Government, the Planning Officers Society
and other parties on the implementation of the Directive are continuing. The main debate focuses on whether the
planning authority will be the competent body responsible for granting
permissions, or whether implementation should be part of the emerging
Environmental Permitting Programme.
Separate direct discussions
are being held with the UK representative on the CEN Technical Committee
responsible for producing a methodology for the characterisation of waste,
which will determine which materials are non-hazardous non-inert and subject to
lesser control.
EMPLOYMENT
Industrial Relations
Ceramic Joint Council
Following informal meetings,
resumed negotiations have resulted in agreement by Unity to ballot its members
on the employers’ offer and to recommend acceptance. The offer comprises a two stage increase, the
first taking effect on 7th August, 2006 and the second on 6th August,
2007. Rates will increase under the
respective stages by 2.6% and 2.9%. All
reference to basic rates will be replaced by a minimum average hourly earnings
figure of £5.43, increasing to £5.58 in 2007.
A separate overtime and guaranteed calculator rate has also been agreed.
In addition a working party
will aim to reach conclusions regarding incentive based schemes.
Agency Workers
For some years uncertainty has
existed over the status of agency workers who have worked at the same company
for a number of years. A recent Court of
Appeal hearing appears to have clarified that the contract of employment
normally exists between the individual and the client company. The fact that payment is made via the agency
is irrelevant.
Ceramic Industry Health and
Safety Pledge
This year’s Health and Safety
Pledge Conference will take place on Thursday, 12th October,2006 at the
Britannia Stadium, Stoke-on-Trent. The principal
guest speaker will be the Deputy
Director General of the Health and Safety Executive.
Health and Safety Awards
Many entries for this year’s
Health and Safety Awards have already been received from BCC member
companies The purpose of the awards is
to recognise achievement and promote an exchange of ideas on best
practice. Guidance on entries can be
provided by contact with Francis Morrall at the BCC.
Contractors Passport Scheme
The BCC is developing further
assistance for companies operating the Contractors Passport Scheme. It will include a list of contractors used by
the industry, indicating which of them has undertaken the training that has
been made available.
Competence and the Quarry
Manager
Further consideration is being
given to the proposal developed by the BCC for establishing the competence of
quarry managers, including appropriate training for employees with
responsibility for quarry operations.
The meaning of competence in this context requires careful definition to
avoid disproportionate commitments.
Consultation is taking place with the HSE to try to establish its
position, which to date appears to have been inconsistent.
Crystalline Silica
The HSE has announced the
implementation of a new workplace exposure level for crystalline silica of
0.1mg/m3 to become effective on 1st October, 2006. The BCC has also been informed that the HSE
will focus its attention on the brick industry from some point not yet
specified in 2007. A full employers’
brief is in preparation.
A BCC seminar dedicated to
crystalline silica will take place at CERAM Research on 28th September,
2006. It will deal principally with the
revised workplace exposure level and the European Partners Agreement. The Agreement will become effective on 25th
October, 2006, although precise instructions on its implementation are still
awaited. They will be circulated as soon
as they are available.
The article on silicosis in
the brick industry prepared by the Institute of Occupational Medicine for
publication in Occupational Hygiene was deemed to be unacceptable by the
publication. The article has therefore
been revised and resubmitted.
REACH
The issue of advice to
companies on the EU Regulatory Framework for Chemicals, following the seminar
held earlier this year, has been delayed due to the absence of definitive
guidance from the European Commission.
Penalties for Non-Compliance
As a result of the Hampton
Review, the Government is considering a full review of penalties for failure to
comply with legislation, including health and safety. The intention is the introduction of a system
which is more flexible and therefore more proportionate.
COMMERCIAL AND PUBLIC AFFAIRS
Liaison with MPs and MEPs
A meeting between the BCC and
North Staffordshire MPs and Midlands MEPs took place in July. The main agenda items included energy prices
and market reform, EU ETS and CCA, waste management regulation under PPC, and
the delay in publication of Minerals Planning Guidance.
There was also considerable
discussion on the apparent reluctance of the UK Government to support the
industry’s campaign for the origin marking of imports into the EU of tableware,
and on the continuing need for action to address counterfeiting and copying of
domesticware products.
Planning Gain Supplement
A detailed case is being
prepared to demonstrate the adverse and disproportionate impact on the industry
and market that Government proposals for planning gain supplement would have if
applied to permissions for mineral extraction.
The BCC is working with other trade organisations through the CBI
Minerals Group to oppose the Government proposals.
Rating Revaluation
The Valuation Office Agency
has agreed to a BCC request for postponement of the listings of brick, clay
tile and pipe works to allow agreement on the cost tones used in the
revaluation to be reached. A programme
has been established aimed at achieving early conclusion of the negotiations.
Federation House,