22
Examination of witnesses
Graham Russell and Duncan Johnson.
Q97 The Chair: Good morning. This is the Industry and Regulators Committee of the House of Lords. We are looking at building safety regulation. Our witnesses in this session are Graham Russell, who is the chief executive officer of the Office for Product Safety and Standards, and Duncan Johnson, who is the deputy director for construction products in that office. Welcome to you both. Could we start by asking you to describe your actual role—how you deal with construction products and what your main areas of activity and interest are in the issues that we are looking at?
Graham Russell: Thank you for the introduction and the opportunity to come before the committee, which we are grateful for. I should like to start, as we always do— when we are thinking about these matters from an organisational point of view—by remembering those who are impacted directly and indirectly by the failures that contributed to the terrible tragedy at Grenfell Tower. We as an organisation keep that central in our thinking about these matters. I am sure you do so as a committee.
The OPSS was created in 2018 as a product regulator in response to issues particularly around consumer products. Prior to that, both consumer products and construction products were regulated solely by local authorities, where I had spent 20 years. Duncan also has a history in local authority regulation. It was recognised by Government at that point that solely local authority regulation was not adequate to deal with some of the consumer issues. That followed on from the Grenfell Tower fire in 2017. At that point, our interest was in consumer products and specifically the Grenfell Tower fire starting, or appearing to start, in and around a fridge-freezer. So we looked specifically at that issue. Was that fridge-freezer safe? Were similar products safe and how do we ensure the safety of such products in consumers’ homes? There was at that point a significant recall of Whirlpool tumble dryers, which was being overseen by a local authority and was seen to be failing as a process. Upwards of 2 million people had these products in their homes and were not having them safely rectified and were left in a position of being very concerned about the safety of their homes, particularly the most vulnerable people.
That was why the OPSS was created, and I was asked to set that up. Since that time, we have built a body of around 600 people who give advice to Ministers on product safety matters, directly regulate product safety, working with local authorities, but also enforcing other matters for other parts of Government, including environmental matters related to products. Our mission is to ensure that people and places are protected from product-related harm. If you think about a product like a washing machine, there is a safety issue but there is also an environmental issue in terms of use of energy and use of water. There is also an interconnected products issue in terms of the cybersecurity of having these products connected in people’s homes. There are issues about electromagnetic compatibility—all sorts of issues. What we try and do is ensure that the producer, manufacturer and importer of that product do not face 10 different parts of Government, all saying, “Could you do this? Could you do that?” Actually, we can have a dialogue with them about the totality of that product.
That led to a recognition, following, first, Dame Judith Hackitt’s review, that in the events that led up to Grenfell Tower there were a number of failures. Obviously, you have just heard about building control. However, one of the things identified was that the products used in that renovation did not comply either with requirements or with statements about those products. So the recommendation there was that a regulator should look at the products themselves, as opposed to the buildings, the way in which professionals inputted into those buildings and the other things that you have touched upon. We were asked at that point to take an extension to our role around consumer products, machinery and other things that we regulate to construction products. Hitherto, prior to that point, there was not a construction products regulator in the UK. Local authorities had a responsibility. We can perhaps come back to how that was being discharged but we were asked to build that capability.
There are two things I should like to say about the way in which the UK approaches product regulation. They apply to construction products as they do to consumer products and, indeed, many other products. The first is that we have a permissive regime. In other words, you do not need to apply to somebody to say, “Can I sell this product?” There are exceptions to that. Medicines are the most obvious area but there are other exceptions. However, in the areas that we regulate, the producer or the importer does not need to come to us and say, “Please may I sell this?”, and we then give them a licence. It is their responsibility to put the product on the market safely, and we deal with the regulation of it. My second but linked point is that we are building on European legislation but taking forward since then our new Product Regulation and Metrology Act, passed this summer. We put the responsibility on the person who creates the risk to ensure that they manage that risk. That is normally the manufacturer; if it is manufactured overseas, it will be the importer. It is their responsibility to think about the safety and the compliance of that product, as well as to carry out any necessary risk assessment before they put that product on the market. Those two principles are common between all of the products that we regulate in the OPSS.
Having been regulating in this area for four years now, we would say—Duncan will come on to some examples as we go forward—that a lot of the features of regulating products are common, whatever that product is. It is about making sure that the manufacturer takes responsibility, thinking about the design and thinking about how standards work. For example, are there appropriate standards for that product that they can use? Can those standards be designated—in other words, can we give the manufacturer or importer an assumption of conformity that, if they do this, they will be doing the right thing? Is there a testing regime that they can avail themselves of and use as necessary? Are we sure that, when they put that product on the market, it is properly produced, it is properly manufactured, it is properly labelled and the information for the consumer or end-user is available?
Those are the systems that bring safe products to market; they are common between different sorts of products. In that sense, that is a product regulatory activity. As the OPSS, we have that responsibility for my department—the Department for Business and Trade—but we deliver this particular part of the work for the MHCLG, which is responsible for building safety. We also work on behalf of other parts of Government, including the Department for Environment, Food and Rural Affairs; the Foreign Office; the Department for Transport; the Department for Science, Innovation and Technology; and lots more acronyms that you, I am sure, know better than me.
There are lots of parts of Government that want things regulated. What we do not want is a proliferation of lots of different people all doing that, so we seek to bring all of that together as a whole. What we have discovered—we will perhaps go into this in more detail—is that, in an unregulated market, you do not have cultures of compliance and behaviour. So the big part of our work has been to shift that forward, really.
Construction products are a sector in themselves. There are something like 27,000 manufacturing businesses in the UK, employing 400,000 people and with a turnover of £68 billion. There are 6,000 companies that sell and distribute those products, and 70% of the products that we regulate are made in the UK. Designated standards, which cover the way in which products have been regulated in the past—and will not be in future, under the Green Paper approach—cover only around a third of the products used in construction, so a lot of products were not covered by that previous regime.
That is quite a long answer to your introductory question, but I hope that it sets the scene for you.
The Chair: It certainly does set the scene. It means that you have the most tremendous remit. You have said all sorts of things that I would want to follow up on, although they are not necessarily relevant to this particular report—such as the product recalls that we see all the time—but we need to concentrate on the construction industry.
Q98 Lord Gilbert of Panteg: You have described a very broad and growing remit, and it is likely to expand further. How are you preparing for the Government’s Green Paper on construction product reform? Are you doing any pathfinder work on it? Are you expecting it to proceed at a reasonable pace? What kind of changes will you require in your organisation if this comes about? Will you need some cultural changes? Will you need to become more muscular and aggressive as regulators in order to enforce this new regime?
Duncan Johnson: I will certainly come to the question of the future role in a moment but perhaps I could just say a bit more about what we are doing right now on construction products before I then go on to the future-looking piece.
Graham set the scene in terms of the OPSS as a regulator. In 2021, he asked me to move across from the consumer product side and set up the new division, if you will, for construction products. Taking what we have learned from there and applying it here, our model for construction products is based around find, fix and tell. In essence, we regulate a vast market just within construction products—everything from nails and glazing to timber, masonry and all the rest of it—so we need to look at that vast market and hone in on those areas where we think there may be product types whose risk is elevated. To do that, we work with partner organisations, other regulators, the BSR, London Fire Brigade and Building Control, but also with trade bodies and across Government. We hone in on the particular product of concern—let us say fire doors—and we will then need to come up with an intervention strategy to probe fire doors and understand the actual performance. Where we find problems, we need to tackle them using the legal tools available and advice to business, and then we need to play back to industry what we found to bring that to life. I am conscious that I need to come to your question on the Green Paper, but it is just useful to understand the context in which we work.
To bring that to life, we did a piece of work on plywood. This was an issue raised with us by the London Fire Brigade. It felt that the performance of certain grades of plywood—the real-world performance of this plywood, which has enhanced performance in terms of reaction to fire—was not actually performing to the necessary standard in reality. So we took that intelligence, we developed it further ourselves, and we went out and tested some of these higher grades of plywood. They typically cost two to three times the cost of a regular plywood product because of the fire treatment. We found a product which failed to deliver its claimed elevated performance, and we were able to intervene there. It had been imported from a Polish company, placed on the UK market, and we were able to get the four importers to take that product off the market and to notify the people supplied of the true performance.
But your question was of course about the future and how this might change. The reason I wanted to get into that is because, over the four and a half years we have been regulating construction products, we have built a significant amount of capability to regulate this new and different market. We have hired, steadily growing the numbers of staff in regulatory design, engineering, analysis and testing science, and we have grown our engagement with industry, proactively building relationships with other regulators and with the industry. So we are engaging with the complexity of this market. We do not think there is a big step change between here and where we might be in the future. We have built the capacity in the current role ready for the future. We are of course working very closely with MHCLG policy teams to input into the Green Paper, and we have had a long history of that. I do not know whether that provides the answer you require.
Lord Gilbert of Panteg: I think it does. I just wanted to come back briefly to something that Graham said in his introductory remarks. He said that in unregulated markets there tends to be bad behaviour. Is that your general view of unregulated markets, or is it specific to conduct in some sectors that you are responsible for?
Graham Russell: Just to be clear what I meant, and apologies if I was not clear, there was legislation but there was not active enforcement, so by “unregulated” I meant non-active. My view and my experience is that commercial pressures will tend to lead businesses to make choices, and if they do not see a regulatory regime, commercial pressures, even if they would like to do the right thing, will make them tend towards not investing in compliance. As a general principle, compliance costs money, whether that is testing, proper training of your staff or proper assurance of quality. That does not mean that everyone has evil intent, but it does mean that commercial pressures tend to degrade the compliance regimes where there is not an effective regulator. The other side of that is that even when businesses wish to comply, if they are not getting any advice because there is not a regulatory presence, then again they will have to make choices that will not necessarily be the best choices. So as a general principle, things will decline rather than advance in the absence of an active regulator.
The Chair: Does that mean you are always chasing the potential for things to go wrong? Are you always behind the curve, worried about what the next crisis is going to be?
Graham Russell: There is a lot of learning on that in the Grenfell Tower Inquiry. You can see that writ large in the way that behaviour developed in the period prior to 2017, and we can talk about what has happened since then. But yes, a good regulator is not always chasing; as Duncan says, a good regulator uses intelligence to get ahead of the market and to advise and to move the market forward. We can say more about that, but we have seen significant change in the culture of the construction products sector even in the few years we have been in existence. But I have been a regulator long enough to believe that, without any form of regulation, it would be miraculous if people all did the right thing.
The Chair: We have Baroness Valentine online, so I will bring her in next.
Q99 Baroness Valentine: My question follows from where we got to anyway. How has the construction industry responded to the introduction of the OPSS as a national regulator of construction products, working alongside the existing local enforcement through trading standards? Have you found it easy to engage with those who you regulate to support compliance, or have there been cultural or practical challenges in getting your messages across?
Duncan Johnson: Perhaps I can respond to that. Picking up where Graham left off, the industry has not historically been accustomed to proactive regulation. If you imagine a fire door manufacturer five years ago, they would have had an instinctive sense that they were regulated by HSE for worker safety. They would have just felt that, and they may have imagined that a health and safety inspector might knock on their factory door one day. But they will have had no such sense in relation to the quality of the products that they are making—that their products are meeting the required, designated technical standards. That has been a challenge, and we are tackling that. We are creating that sense of regulatory presence, that sense that somebody cares, and that there is a regulator there which may very well buy your product and test it or come to your factory and ensure that you are meeting the required standards.
The other thing that is unusual about this market, beyond the historical lack of regulation, is the lack of consumer influence over the construction products. If you think about the products that go to make up your home, it is unlikely that you had any say in their selection—there is no consumer lever here. There are many actors between the construction product manufacturer and the ultimate building user, the beneficiary. There is a manufacturer, but there may be an architect, and a subcontractor that buys the construction product on behalf of a principal contractor and then sells the building to the occupier. There is another problem in this market, which is that, historically, there was no regulatory lever and no consumer lever, so there was very little to hold the business to account.
As we go out there and deal with businesses, we are finding that they are not where other sectors might be found, so we are having to work very hard to support businesses in lots of different ways. We are very supportive of the industry-led Code for Construction Product Information, which is a way for manufacturers to ensure that they are doing the right thing and have the product information right.
It is very important to remember that it is not just about the product itself. The product itself has to meet the required standard, of course, because if it does not, then the buildings that are made from it are unlikely to meet their required performance. But the product information that accompanies the product also has to be right to allow it to be properly selected—for the correct product to be identified and properly installed. Of course, the marketing needs to be right as well. We saw in the Grenfell Tower Inquiry problems in all those areas.
This industry has started a long way back. It has made some progress since we have been engaging with it, and we have been working with trade bodies to develop generic guidance on things such as declarations of performance, which manufacturers are required to draw up before they place a product on the market. But there is still some way to go.
If I can give an example, going back to fire doors, a couple of years ago, OPSS inspected every UK manufacturer of external fire door sets. They were very surprised to hear from us because, typically, the conversation went, “Who are you? What do you do? Why do you need to come and see me?” There was no perception or sense of being regulated. We found technical failures at all 20 of the UK manufacturers for external fire door sets. Thankfully, in that particular project, we did not need to take enforcement action; it was merely advice. We were able to give advice, go back and recheck where necessary, and get them where they needed to be. These were not critical failures. But, in other programmes, we have found that we have needed to, for example, take products off the market and effectively shut down production lines until things can be done properly.
Baroness Valentine: I just had a follow-on question: has the disparate, complex nature of the sector caused you any problems as you have taken on your new role?
Duncan Johnson: I would not say that there is so much complexity here. It is a broad market, but we are used to broad markets with many thousands and millions of products—that is what we do. What is different is the historic lack of regulation and the lack of consumer influence. If we think about cosmetics, the buyers of cosmetics typically have strong interests in not buying cosmetics that will harm them, but the end-user of a construction product has no say in the chain. So it is very important for us to influence that whole supply chain so that all of the actors in that supply chain are properly incentivised and encouraged to be curious—that was the language of the Grenfell Tower Inquiry, which said that some of these parties are insufficiently curious about the products they use.
Graham Russell: The industry sector is not desperately complex compared with some sectors that we regulate elsewhere. There is not, for example, a high penetration of online marketplaces, which tends to make supply chains for some consumer goods very complex. What are complex are the products themselves and the future products. When we think about modern methods of manufacturing, we think about moving from products arriving on a lorry and being built on a site to construction in the factory and then modular construction or 3D printing of products on site. There is complexity in that. As the examples Duncan cited show, a fire door is a fire door—but it is not. There are different categories of fire door, different classes, different use constructs, different ways of installing them and different skills necessary to install them safely. So the complexity that you allude to is probably more in the products than in the sector, and that gives us genuine challenges. We might come back to this in a moment, but testing those products to ensure that they are what they say they are then becomes complex as well. We can perhaps come back to that.
Q100 Lord Teverson: Thank you for the introduction. You sound like you have a bigger responsibility than anybody else I have ever spoken to. It is so broad. There is a huge number of products in construction and, as you say, there are different grades for different situations and applications. So, going back to your point about Polish plywood, you said you persuaded the manufacturer to take it off the market or to recategorise it. What if they had not bothered to do that? What would happen then?
Duncan Johnson: Thank you for the question. I slightly rushed the answer. What we dealt with was four UK importers, and they act as the manufacturer in a legal sense when they place the imported product on the market.
Lord Teverson: So the importer is the person who is legally responsible.
Duncan Johnson: Yes, so that was easy. We were able to serve prohibition notices on them placing that product on the market. We were able to require them to recover the unused material from the supply chain and, critically, to notify all the people who had been supplied of the true performance of the plywood. This case was interesting for us because we were also able to engage with the Polish manufacturer. We have not got any jurisdiction, but we spoke to the Polish regulator. The manufacturer was actually very helpful. They confirmed our test results—they tested themselves and confirmed they had a production problem. They managed to find the root cause and remedy the problem. It is a nice case for us because the manufacturers—we have dealt with them more than once—have now reached a point where they are very pleased with the UK regulator because they are conquering new markets as their products are a lot better now. So it is quite a nice story—it is a shame it is a Polish manufacturer and not a British one, but this is a good news story. But we did get to the manufacturer in that case.
Lord Teverson: So if someone in your organisation wants to prohibit something, can they just make a prohibition order? Do they have to go through courts or tribunals?
Duncan Johnson: That is correct. I am authorised to issue the prohibition notice, which would go to a business, effectively telling it to take the product off the market. It can be appealed, of course.
Lord Teverson: One of the things that came out of the Grenfell inquiry was that it was “systematic” and a number of suppliers were almost dishonest in terms of the characteristics of their products. I am interested in your comments on that, but you are also suggesting, maybe through your fire door example, that there is a laziness, rather than necessarily an intent to have the wrong products applied to buildings. Can you talk us through that?
Graham Russell: I will say a couple of things about the system and then let Duncan talk about the specifics. I will maybe give a different example from fire doors, just to broaden out the conversation a fraction. There are two things. First, we are part of the Department for Business and Trade and, as a Government, we recognise the role that regulation has in supporting growth. Duncan’s point about the plywood companies is very interesting. People do not grow by cutting corners and breaking the law. In the long term, what is necessary for growth is confidence in markets. You need to know that what you are buying is what it is supposed to be and that you can buy and use it with confidence, whether you are a consumer or a supplier. We believe that good regulation supports growth by supplying confidence to markets. There are lots of examples of that, not just in construction products but elsewhere.
To emphasise the point in an earlier question about the word “muscular”, Duncan might look like a very amenable fellow, but that power to take products off the market is very significant and, although companies can appeal, at the first instance we can have that product suspended and prohibited. If people do not comply with that, we can go in and take the product ourselves and they face criminal prosecution for failing to comply with that notice, so there is a pretty hard edge to this. Obviously, we would far rather work with businesses where we can, but there is an iron glove within that—which way round is it?—or an iron fist within the velvet glove or whatever.
The Chair: Who do they appeal to?
Graham Russell: There is a separate appeals mechanism in the regulations. I am looking to Duncan for the detail here. We have used this on one occasion, have we not?
Duncan Johnson: The prohibition notice is served by OPSS. We often require manufacturers to notify those that have been supplied with the full details of what they have been supplied with. This is critical so that risks in buildings can be properly managed. There is a quite arcane and complicated process for that in the current regulations which involves appeal to the Secretary of State, but otherwise it is OPSS.
Can I pick up the point that was made about the different types of behaviour? We often use the language of carelessness, negligence and criminality to describe what I think you were pointing to. On the fire door manufacturer inspections, we were finding carelessness issues, such as measuring equipment that was not calibrated to the necessary standard—the kinds of things where, if nobody checks, things drift. That is what I would describe as carelessness.
On negligence, we found an interesting case recently to do with tubular fire door closers. These are a tubular piece of metal that goes into the side of a fire door, with a spring and a chain to the frame that pulls the door closed. This manufacturer was advertising these tubular products as suitable for use in fire doors. Indeed, it had the test certificates to show that, but the testing had been carried out using an intumescent sleeve over the metal product, the issue being that when fire doors heat up in a fire, the metal products on the door get very hot and can easily burn through the door, causing it to fail earlier than it should. It is a very important safety issue. The manufacturer tested its tubular product with an intumescent sleeve, which expands in heat and keeps the metal cool so it does not burn through the door, but its product information, which was supplied with the product, did not mention the need for an intumescent sleeve or whatever type of sleeve it was tested with. So whoever bought that product might well have seen that it was suitable for use in a fire door, used it unwittingly and created a risk. I would probably put that down to negligence. In that case, we required the business to take the product off the market, reform the product information and notify everybody supplied with the product. It has indicated that it is reviewing its product information. It is a very large manufacturer, with a very broad product range. I would describe that as negligence.
Then we get into criminality. We had a case recently where a steel fabricator, which is a manufacturer for the purposes of its work, was asked by a tier 1 contractor for the certification to ensure that the work had been done to standard and overseen by a conformity assessment body. The information that was supplied up the chain was entirely falsified. This is more of a criminal issue. You get the range of behaviours that we are seeking to deal with.
Lord Teverson: Let me just quickly ask: how did you come across that last example?
Duncan Johnson: The last one was reported to us. There is an irony here. One of the biggest problems in this market is that, as we heard at the Grenfell Tower Inquiry, people can just pass the next person on the chain almost anything, because they are not curious. I think that, anecdotally, we heard of somebody passing the designated standard to the next person in the chain and then saying, “Okay, those are the test results, they’re good”. Ironically, this person had the misfortune to pass the fraudulent documents to somebody who was vigilant, and therefore it was reported to us.
The Chair: It is all a bit hit and miss whether the right person sees the right document at the right time and understands what the problem is, is it not?
Q101 Viscount Trenchard: I would like to ask you about the National Quality Infrastructure, the NQI. You have already mentioned that there are a large number of acronyms around, and the NQI is one that I had to do some research to understand. My limited understanding of it is that it has five core components and it is a relatively new organisation but it comprises four much older institutions: the BSI, UKAS, the NPL and the OPSS. I would like to know how relevant and coherent it is. Are you satisfied that it will be able to adapt sufficiently to a stronger regulatory framework, given the potential it has for conflicts of interest between all these bodies? If you were given oversight of the NQI, how would you seek to manage it and its conflicts?
Graham Russell: Sometimes I think I should apologise for all these acronyms, and then sometimes I think, “Well, I’m just a victim of them too”. NQI is an international terminology that we have adopted in the UK. It stands for National Quality Infrastructure. Your introduction is exactly right: it is a set of existing bodies that come together to give confidence to a market. They give confidence to the construction products market just as they do to food, consumers or to any other area. So in that sense, the NQI is not topic specific.
We are responsible on behalf of the Government for the relationship with both the BSI, the standards body, and UKAS, the accreditation body, which for a number of years have supplied that confidence into the UK market. They are also part of international bodies that seek to do that both across Europe, regionally and across the world, through ISO in terms of standards and IAF in terms of accreditation.
They are important bodies because, any time you buy anything, you need to know that you are getting what you pay for in terms of quantity, quality, safety and compliance. If you do not know that, the whole basis of trade is undermined. If I have to go and test everything you sell me to see whether it is what you say it is then I am never going to buy anything from anybody, so we all rely on this thing all the time, but of course neither you nor the other 60 million people in the country ever thinks about that when you are purchasing items. As Duncan has said about construction products, the consumer does not even see the product; they just buy the house, flat or whatever it might be and move into it. So this is one of those unseen but vital parts of the UK economy, and we work on behalf of the UK Government with those two bodies in particular.
We also have a close relationship with NPL, the National Physical Laboratory, which is responsible for the science of metrology—if my memory serves me right, it recently redesignated the kilogram—and it is operating at that scientific level. We operate at the more legal end: how do you know if you go into a greengrocer’s that you are getting a kilogram of whatever it is you are paying for?
We also do market surveillance across the whole of Government as well, so we ensure that there is a system that means people can be sure of what they are getting. In terms of construction products, that is critical, and we saw some failures in the system in the Grenfell Tower public inquiry. Both BSI, the standards body, and UKAS, the accreditation body, have been under some scrutiny since then because of perceived failures, particularly in the accreditation of the businesses that did the testing prior to Grenfell Tower. What we have done through the OPSS, and what my Minister has done through holding them to account, is say to them, “Are you ready for a new regime? Can you do this properly going forward?” UKAS has had a project called Project PACE, which is solely to ensure that what happened leading up to Grenfell Tower does not happen again and people can have confidence in the testing system. The public inquiry’s final report into Grenfell Tower strongly emphasised the importance of robust testing, proper accreditation and proper systems.
I will say that UKAS is not a regulator. We are the regulator, and we have only been around since 2021 in this space, so quite a lot of change has happened in this period. UKAS is responsible for ensuring there is a cascading regime, if you will, that ensures that testing is done properly and to a standard, and that information that is passed up the system can be relied upon.
I am sure you have come across some of the phrases like “golden ticket” or “golden product”, meaning that people test and test until they find something that passes, and then they put it through the system. That has not given confidence to people that the system is actually giving end-users what they need, so we have been working with UKAS and it has already taken action in regard to certain schemes to suspend or partially suspend accreditation where that has been appropriate. This is happening now. It has been a hard road, because it is different; we have spoken about the culture of the industry, but there is also the culture of the regulatory state, if I might use that phrase, and we have had to see things differently.
I know there were failures at Grenfell Tower that really challenged regulators in the UK to ensure that does not happen again. That is quite a long answer, but it is quite a complicated topic. My apologies for going on at length, but my short answer is that a lot has changed. We are still on a road to getting that right. It is about ensuring that the trust is there and that people can believe the certificates, testing and standards that they see. It is not just a UK issue—it is a global issue—and the UK is actually a leader in this space.
The Chair: Baroness Drake is online.
Q102 Baroness Drake: My question is on enforcement. The 2020 review of the construction product testing regime found that enforcement of the regulations had been almost totally non-existent. It is difficult to find a lower bar than that for a regulatory regime. Can you tell us what tough actions you have undertaken to improve the level of enforcement in the sector? Secondly, you said in reply to a previous question that you have built capacity for the future, but what will you need, whether it is powers or resource, to further expand this enforcement from such a low base?
Duncan Johnson: Maybe I will go back to one of my previous themes around identifying those priority products where we think risk is elevated and they warrant further scrutiny. We call it moving markets. If we think about a particular market—I will talk in a moment about heat-soaked toughened glass—we cannot necessarily always engage with every single product. We need to identify a priority product and try to shift the market towards compliance, not just the manufacturers but the buyers, the specifiers and all the other people with an interest. So this is about identifying the right priority topics where change is needed and pushing whole submarkets in the right direction.
To bring that to life, heat-soaked toughened glass is an interesting product. We picked up intelligence from CROSS, Collaborative Reporting for Safer Structures, which is an independent body which any anyone in the construction industry can make an anonymous report to. It effectively verifies the report and then shares it anonymously with the rest of the system. It is like the anonymous reporting for the aviation industry: it is very powerful.
We picked up on industry concerns about heat-soaked toughened glass. This is toughened glass which, once it has been completed, is subjected to an additional quality control step. The glass is placed in an oven on a designated heating programme and, if the glass contains impurities, it will fail in that quality assurance process, and therefore glass which has been properly subjected to that is much more reliable.
CROSS identified a lack of confidence from industry, with glass panels shattering—falling glass is never good. But the glass is sometimes safety-critical in terms of people relying on it to avoid falling off a balcony or something like that. There was also a lack of confidence in specifying these products. They are often used in places where it is very expensive to replace a glazing panel, so you put a better product in.
We got that intelligence. The challenge is that there is no way for us or anyone else to be able to look at a piece of glass and know whether it went through the quality control process correctly or not—it is the same. This is where having a bespoke intervention is key. For that reason, we decided we needed to verify performance of this particular sector, so we carried out unannounced inspections. We think very carefully about whether to announce our visit to a business or to go unannounced. On this occasion, we went unannounced to all the UK manufacturers to look at what they were actually doing. It is a cost-additive step to take panes of glass and to heat them, and then some of them will fail, so there is an obvious incentive for people to cheat. We turned up unannounced to all the factories to look at their oven calibrations, their temperature profiles and whether they were complying with the designated standards—all of those things. There were around 30 companies in total. We prohibited six manufacturers until they could put all of those requirements under the designated standards in place. That is an example of the enforcement approach we are taking.
It became quite amusing because, by the end of that programme, our inspectors were arriving on the doorstep and the industry representative was saying, “Oh, we thought a woman would arrive”. They all knew that we were out there. The whole sector had its awareness raised, and that rippled out wider. I can assure you that the whole glazing industry knows that there is a regulator out there that is called the OPSS and which is interested in the quality of its products. So we really are doing this now for rigorous enforcement action and a more muscular approach.
Baroness Drake: In terms of the six that were barred from continuing to produce these glass windows or whatever, what did you do for the products that were already out on the market? Did you make them recall them all?
Duncan Johnson: It is based on risk. When we find a compliance issue, there is a risk-based triage as to how we deal with it. If it is minor—I talked about fire door manufacturers earlier—we will give advice to the business and make sure that it acts on it. If we think that the product is likely to be unreliable, we will typically serve a prohibition notice so that no more product goes on to the market until we are satisfied that it has been made properly. That usually gets rectification quite quickly.
Product that has gone into the supply chain is a challenge in any product market. Based on a risk-based decision, we would typically require all of the parties that have been supplied to be advised of what information is available on the product that was supplied, and we would share that information with the relevant regulators. Sometimes we might know exactly which site it has gone to but, most often, we will not know that so we will put a product alert out to the whole industry. Because of low traceability, we may not know exactly where it has gone through the distribution chain, but we always tell the BSR and, in most cases, the local authority building control.
Baroness Drake: What further resources and powers do you need to bring your compliance and enforcement regime up to the level that the UK needs?
Graham Russell: I want to add just one more thing on the previous question. Whether a product should then be taken out of a building depends on the use case for which it has been used. Just because something was specified in a certain category, it is not necessarily the case that it needs to be of that category. That is why it is the responsibility of the building safety regulator or the local authority building control, once they have that data, to work with the building owner.
The question of resources is difficult. “How much is enough?” is a difficult question in all of these areas. There is no doubt that we have had to be very active in trying to shift these markets, but, as Duncan said, once you get into the glazing industry and it sees the visible signs of people being active, a lot of people—I am a big believer in the 80:20 rule—will change their behaviour at that point, once they see that there is a consequence to not changing their behaviour. Although there is a cost saving in not testing the glass or not heat-proofing the glass in the factory, there is a much bigger cost to having all that glass to recall, having reputational issues and so on. So you can start to shift that dynamic.
The problem is that it is a very large industry. There is complexity in it. There are hidden pockets of criminality. There are big issues around intelligence and use of products. So what we are doing in the medium term is seeking to develop and train our own regulators. We have an apprenticeship programme and a graduate intern programme. In the medium term, it is about building those skills. There is not an ample supply of skilled regulators in the UK sitting around waiting for me to employ them. We have had to do that. We have built a team. A lot of people have come from local government or other regulators, but we have had to build that team. We are now investing for the future so that that team can be sustained going forward.
It is always about a combination of competence, capability and capacity, as well as the legal framework in which you operate. You have to have all those things working together. Great regulators cannot enforce law that does not work. Great law does not work if you do not have a regulator enforcing it. My job as the chief executive is to try and bring those things together in harmony and ensure that we can progress that forward. When we started in 2021, we did not have all the powers that we needed. Some new powers were given to us in 2022, and the Green Paper envisages further powers and responsibilities which we would take forward if and when those are granted.
Baroness Drake: How long until you are fighting fit on your compliance and enforcement regime?
Graham Russell: I hate that question. I think we are doing a good job today, and I think the world is a safer place because of what Duncan’s team is doing today. When will it be perfect? I was in trading standards for 20 years dealing with some long-standing legislation. The Weights and Measures Act has been around for a very long time. There is always a challenge. There are always people who will seek to exploit gaps in the market. You always have to have a robust response to that, and you have to be able to deal with businesses that need advice—those which want to get it right but need support. I think we are doing those things. I think we could do them better, but I would struggle to say, “On this date, we will be perfect”.
Q103 Baroness Nichols of Selby: Returning to the theme around question 15—you have just mentioned you worked in trading standards for a number of years—how do you work with local authority trading standards to provide enforcement in the construction products regulations? To what extent is the lack of enforcement activity due to the shortage of resources faced by local authorities and how do you try and work around this?
Graham Russell: This is an important question. As you have mentioned, I was in trading standards for 20 years. I was head of service for Staffordshire for a number of years, and one of my remits was construction products. Even then—and this is back before Grenfell Tower—we did not have an active capability around this topic, and resources are fewer now than they were then.
There are certain issues that trading standards locally can deal with. That is about local activity, local supply, relatively less complex products and being eyes and ears for intelligence locally. Those are all things that can happen. We are not only in construction products, but also in consumer products, metrology and hallmarking; there are other things that we do. We work to support local authority trading standards. We train them, provide them with scientific advice and provide them with budgets so that they can do testing. We resource them to do work at borders on imports. So, we definitely do work with trading standards to try and ensure they can do their job as well as possible.
But construction products, as we have mentioned in this conversation, are complex. Do we really think that trading standards are going to develop the skills that Duncan’s team had to develop to go into those glass manufacturers and do that assessment? I suspect we have three or four of the only people in the country who could do that, and there are 207 local authorities in trading standards.
I think we have to be reasonable about what is best done locally and what is best done nationally. When you are talking about complex global supply chains, cutting-edge products and highly technical testing regimes, I am not sure that it is reasonable to expect all those trading standards departments to have all of that capability.
I do not think it is just about resources. But, famously, trading standards have about half the resources now that they had in 2010. Even if you doubled that back again, I am not sure that you would develop 207 centres of excellence to do what Duncan’s team are doing, and I am not even sure you should.
Q104 Viscount Thurso: I am going to start with an apology, as in two minutes I have to go, so I am going to give you a question and I would ask if you would write in, because it is quite a big question. It is about what level of skills and resources will be needed to take on the role that is envisaged in the construction products reform Green Paper, including any guidance and enforcement in relation to all the construction products. On top of that, how easy will you find it to recruit the expertise that will be needed to do it? You have touched on that already, but rather than get into that and then have me leave in the middle, could I ask you to write to us on that?
Graham Russell: If the Chair is happy, then I am happy to do that.
The Chair: Yes, I think we would be happy. Indeed, if you want to follow up with more detail on any of the other topics, we would be more than happy to receive that.
Q105 Baroness Harding of Winscombe: You talked about the culture of the regulatory state. I want to explore the capacity of the overall regulatory state a bit. Does the broader system of National Quality Infrastructure have real capacity issues, which then create problems for you as you substantially expand your waterfront?
Graham Russell: There is a glib answer to that and there is a slightly deeper answer. The glib answer is that testing, test houses and accredited test houses respond to demand. The more that we as a regulator exercise our activity, the more that businesses, which need to have confidence that what they are doing is compliant, will submit products for testing, so the more demand will be sucked through the system. But that can sound quite glib because it assumes that it will fix itself in a sort of Panglossian way.
I do not think that it is quite that simple. There are some structural barriers in the market and some reasons why there is less testing capacity than there perhaps could be. One of the answers is that, because we have regulated—and the Government have expressed their intention to continue to regulate—for the acceptance of CE marks along alongside UKCA marks, it means that people can use test houses outside of the UK in Europe to build wider capacity. That is certainly part of the answer. But a lot of our conversation with the BSI and UKAS is about ensuring that they have the capability and capacity, and that they oversee that in the wider UK NQI world to do exactly what you described.
It is a little bit chicken and egg: there is no point having a test house if no one is sending any products for testing. We are seeing an incremental change, rather than a sort of step change.
Baroness Harding of Winscombe: What is the quantitative scale increase in products that you are going to be regulating and the amount of additional testing capacity that doing this properly in the construction sector is likely to bring? If you do not have the number to hand, it would be interesting if you could write in.
Graham Russell: I think we have some numbers on the distinction between the current regime and the general requirements.
Duncan Johnson: Working in line with the Green Paper, the numbers, which Paul Morrell’s report quotes anecdotally, are that only 30% of construction products are currently regulated. So another 70% would be covered.
Baroness Harding of Winscombe: If you compare what you currently regulate outside of construction, how much extra workload are you putting into this system? Rather than percentages, I am interested in absolutes.
Duncan Johnson: Perhaps I will go back to the 30%. Paul Morrell’s report said that only 30% of construction projects are covered by designated standards. That is what we currently enforce. But the Green Paper envisaged it would be only a general safety requirement for the additional 70%, which would not necessarily require accredited testing. That is for the designated standards, so there would not be an expansion in the need for accredited testing.
From OPSS’s perspective, it would be very helpful to have some controls over the wider products that are not currently covered by designated standards. For example, we sometimes encounter products where we feel that there is an issue, but there is no designated standard with which they have to comply; therefore, we are limited in what we can do on a safety basis. So that would be helpful.
It does not automatically follow that our work increases, because we do not have to do the same work for the wider piece. So it does not scale up that we would need triple the resource because three times as many products are covered.
Baroness Harding of Winscombe: That is helpful. How worried are you about capacity issues in the overall ecosystem?
Graham Russell: I do not think that we are worried. It is important that the resources are there to do the work that is necessary, but I would not say that we are worried about that. Regulators always have to scale their resources according to what is available. For what it is worth, in a different world, I am not sure that I would ever give regulators all that they ask for, because there is a lot of evidence that says that, if regulators do too much checking, you create a moral hazard for the people who should be taking responsibility. I share that view.
However, in the way that Duncan has been describing, we do see that there is a need to create a difference in the industry. As you create that difference, it is not appropriate that you then follow them around checking everything. If we are still going to every glass manufacturer once a year every year, that will not be a success in five years’ time.
Q106 Lord Udny-Lister: I should just declare my interest as a director of a property company and a housing association. They are in my entry in the register of interests. But my question is about the OPSS’s co-operation with the BSR. How do you co-operate with the BSR? To what extent do you share information? Tell us a little bit about your relationship.
Duncan Johnson: I could come in on this one. We have a very strong connection to BSR. As you know by now, we were set up in 2021 to take on construction products. BSR was then in shadow form, but we have been collaborating with BSR since then. There is an overarching memorandum of understanding between the organisations that sets out the principles for that collaboration with strategic quarterly meetings and fortnightly operational meetings. We have a number of key documents that underpin our collaboration, such as a joint protocol between BSR, HSE and the National Fire Chiefs Council about how we would respond to a high-rise building issue involving products, and we have a communications protocol about how we share information with them.
Just to bring that to life a bit, our engineers meet their engineers to exchange insights into what is happening with products and buildings and what is happening with products in the market as we are seeing it, and our intelligence is very tightly connected as well, so we have a very close connection with BSR.
Going back to glazing again, we had a case where we discovered a building where glazing units were failing and falling out. We were able to provide the exact details, we worked with the manufacturer and dealt with the problem at manufacturing level, and then we were able to share the details of that with BSR, which worked with local authorities and building owners to get those defective units taken out of buildings and replaced. We have a very good relationship with BSR.
Graham Russell: If you were to put that in very simple terms, because Duncan gets involved in the detail and I am at a slightly more simple level, we need to make sure that what turns up on the lorry at the building site is what it says it is. BSR is then responsible for whether that is properly specified, properly used and properly installed and whether the building is safe. But if what is on the lorry is not what it says it is, then it is impossible for it to do its part right. We have to exchange data at that point. If we come across a problem, it needs to know about it and then it implements that.
Q107 Lord Best: I want to ask something slightly different. The Building Research Establishment used to do an awful lot of the testing and you could rely on that organisation. Its credibility has been rather reduced post-Grenfell. Is there a lacuna there? Is there a gap that needs to be filled in terms of the testing that everyone is going to rely on, or can we see a revival of the good work that the BRE used to do?
Graham Russell: There are two aspects to what BRE and BBA have historically done in this space. One is testing and the other is scientific understanding of the industry. Those are two vital responsibilities. There were big questions asked through the Grenfell Tower public inquiry about those bodies—I am sure you have looked into that in detail—and there are real challenges there, but those responsibilities are still necessary. Whether they are delivered by those bodies or by others is a matter for us supervising UKAS to ensure. This comes back to the question I was asked earlier about capacity and capability, but it is not a static science. Having a test house that can carry out a test is great, and being sure that they do it properly and having them properly accredited is really important, but you also need a feedback loop so that you are learning whether the test is adequate, is doing what you want it to do and delivering a product that will be safe in use. That is what those bodies were bringing to the market. I think a lot of our conversation with UKAS and others is around ensuring that we have that continued scientific understanding. One of the consequences of the Grenfell Tower event and the public inquiry has been a lot more focus on this through academics and so on, so there has been quite a lot of research into this area, which we continue to promote and which MHCLG has taken responsibility for. But you are right, it is not as simple as, “Is there testing capability?”. It is also whether there is that contribution to the wider understanding of the results of testing.
Lord Best: Do you have anything extra?
Duncan Johnson: I think part of your question was around our use of testing. I am just perhaps stating the obvious, but we go through a procurement process and use the entire market. We do not have one or two test houses that we use. We test internationally quite a lot as well. There is a global market for testing that we can access for our work.
Q108 Viscount Chandos: You talked about how you work with the BSR. How do you think that will change as you are brought into the single construction regulator? Would that make any difference?
Graham Russell: I think it is imperative that the connection between the regulation of the products and the regulation of the buildings is very closely knit together. As you have heard, I see those as being different functions with different skills, working with different industries effectively. There is not much crossover between the people who make products and the people who build buildings, but we have to work together, whether that is currently a separate function, separate organisations or in whatever the Government decide to do in future to take forward the recommendations of the public inquiry, which the Government have accepted.
The department is intending to create and publish a prospectus in the autumn. I and other witnesses whom you have heard from, including Dame Judith Hackitt, are contributing to those conversations about how those skills and capacities work together. What we can say from our perspective is that, whatever decisions are made about structures, we will continue to ensure that the information flow is maintained.
As I said in my introductory remarks, we work across a number of different product areas. We work with other regulators in all sorts of ways. On PPE—personal protective equipment—we work with HSE and MHRA. We have different functions and different responsibilities, but it is imperative that the regulatory state works together for two reasons: to ensure that we do good protection, so that the data flows; and to ensure that we do not put excess burdens on business by making them run round the houses and deal with different people who are saying slightly different things.
The point that you are making, I think, is that, whatever the structures and whatever the future, we have to make sure that we work effectively together.
Viscount Chandos: You feel that a single construction regulator ought to ensure that the two stages of the process for which you and the BSR are responsible are as well co-ordinated as possible, but do you think that there is a risk? In the commercial world, for example, more than 50% of mergers or takeovers are found not to be positive in their outcome. What should we be looking for to ensure that it is at least as good as it currently is—preferably even better?
Graham Russell: As I say, the Government have committed to publishing a prospectus on how that will be organised. I do not think that it would be appropriate for me to second-guess what that might be other than to say that, whatever structures are created, we must make them work.
There are no structures that solve problems with data exchange and data flow. That comes from a culture of people wanting to share data; from having legal systems that allow you to share data; and from technology that enables the data to flow. You can have a single body or a thousand bodies, but you still have to solve those problems. The Government will publish this prospectus, which will set out how they intend to take forward the single construction regulator.
Q109 The Chair: You mentioned Polish plywood earlier. It raised in my mind the level of international co-operation on some of these issues and dangers. You described the structure that we have; presumably other countries have their own. There will be some levels of European co-operation, but is there sufficient international co-operation on alerting people to some of these problems that are coming up?
Duncan Johnson: We clearly regulate products that are sold on international markets, and we typically use notification systems to share information with international partners. We are active in a wider sense in product regulation on the international stage.
The Chair: Do other countries give you notification of problems?
Duncan Johnson: We are part of the same international notification databases so, yes, that is possible. I can think of a couple of occasions. We co-operated with the regulator in the Republic of Ireland in relation to an insulation case, where it was manufactured there, and we also co-operated in relation to Poland. We have a team that is very good at securing co-operation where we need it, on a case-by-case basis, but it is often an electronic notification approach.
Graham Russell: I was just looking for the data on how many notifications we have made to the international system; Duncan can probably find them quicker than me.
Partly because of Grenfell Tower, the UK has taken this matter very seriously in recent years. We are probably at the forefront in making international notifications. What we find is that, in Europe and more broadly across the world, people are very grateful for that. There is an investment in this in the UK, which means that we can provide some of that data into the system.
However, everyone has to solve this problem. Dame Hackitt might have given you evidence on this; she certainly did a lot of work with the Australians’ comparative systems. Things like that are really helpful because we do not solve all the problems just here in the UK; other parts of the world are tackling the same thing.
Duncan, do you have that data there?
Duncan Johnson: I do not think that I have the exact number you wanted; I have only the approximate database number.
The Chair: That is fine; we do not need the precise numbers. It is the general approach that I was thinking of.
Graham Russell: To summarise, the UK is leading on this because we have created these systems. To go back to the question that I was just asked about data sharing with the BSR, when we find a problem, we make it widely known because we want other people to have the benefit of that. We are probably at the forefront there in terms of the amount of data we are providing, but we see lots of other countries that are seeking to move forward on this.
You will know as well as we do that there are, and have been, significant issues with building failures. I think that, in the UK, we have been particularly driven by fire, but other people have seen more failures in terms of construction and so on. It all comes down to the same problem: ensuring that what you put into the building is capable of doing the job it is specified for.
The Chair: Thank you very much indeed for your time and your patience. We have kept you later than you had perhaps anticipated. It is clearly an incredibly large field that you are dealing with, so thank you very much for coming along and talking about the construction aspects. You have alerted us to the fact that we must keep our eyes open for other aspects, because it is clearly extremely interesting and very important. Thank you very much for your time today. If you want to follow up on anything, please do so.
Graham Russell: Obviously, we will write in relation to that one question in particular.
The Chair: Indeed—thank you.
