page 1 Friday, 7th November 2008 (12.00 pm) MR MARTIN: My Lord, the proceedings this morning involve Mr Sylvester-Evans being asked to return to the witness box, first to give his views, having heard all of the evidence and response to his recommendations during the course of Phase 2 and then, secondly, to be examined by any core participants in light of all of the evidence that he has given. In order to assist that process, Mr Sylvester-Evans has produced a summary note of the parties' views of his recommendations. I am sorry that having regard to the relatively short time since the evidence concluded yesterday this has only become available this morning and certainly is no criticism of Mr Sylvester-Evans. It has been circulated to the parties although I accept a relatively short time ago. It is, however, intended to be of benefit, in effect, as an aide-memoire of the evidence he is now giving finally having taken account of all the evidence subsequent to his own. If my Lord is agreeable, I would invite him then to return to the witness box, I will take him through this document relatively briefly and then it will be a matter for my Lord to determine what questions there are to be asked. page 2 ROD SYLVESTER-EVANS (recalled) Further examined by MR MARTIN THE CHAIRMAN: Mr Sylvester-Evans it is very good of you to prepare this document at short notice. A. It was a slightly late finish last night, sir. THE CHAIRMAN: I suspect that was the case. So thank you for your trouble. MR MARTIN: Thank you very much, my Lord. Good morning again, Mr Sylvester-Evans. A. Good morning. Q. I think for my purposes what I would like you to have in front of you is the summary you have prepared. Perhaps it might be as well if you also have your report available. It begins at page 9674. It may not be necessary to look at it but obviously questions may require you to do that. As far as I am concerned the other evidence which has been led can be put to you if appropriate. I think it would be right for me to confirm at the outset that am I right that you have been present throughout Phase 2 since you gave evidence and you have heard if not absolutely all of the evidence that has been led in Phase 2 you have been present for virtually all of it? A. I have heard all the evidence. page 3 Q. So if we look at the summary note on parties' views of your recommendations and if I simply go through each of these and in certain cases you record that there does not appear to be any particular dispute remaining. The first and perhaps it is not necessary but these begin on page 9727 of the Inquiry bundle where your substantive recommendations in your report appear. The first is -- and I will try to summarise the recommendations -- is the reduction of the number of interfaces. I think you say there appears to be general agreement between the parties on that. You refer to the physical interfaces of responsibility which I take it means, as I discussed with Mrs Caldwell yesterday, the actual responsibility for the bits of the system? A. Precisely. Q. You say: "Further, parties agree that there is considerable merit in standardising the location of the interface for all LPG systems" and I think you deal with that again right at the end. The second is that each party has a clear account of who has title and various other elements of the characteristics and responsibilities of the system. You say there appears to be general agreement although Mrs Caldwell observed that if a verification page 4 system was introduced there may be a better alternative than to have this material lodged in a safety dossier. I may be wrong, Mr Sylvester-Evans, but in a sense the expressions "verification scheme" and "safety dossier" used in your original report I took to be for convenience, but ultimately are we talking about what is a single body of information related to each individual system and the various elements which will be part of that body of information? A. That is correct and the verification scheme is an independent review of that body of evidence and the certificate forms part of that document in that sense. Q. So whatever one calls it for the purposes of your explanation originally, one is not suggesting different documents in different places dealing with different things about the same system? A. That is correct. Q. At the bottom of the first page you refer to noting the UKLPG's written response -- and of course this came in the other day -- that their members did not consider that it was right to extend the responsibility of the LPG supplier and the safety responsibility of service pipework and the LPG system remains with the site operator and you deal with that in relation to recommendation 22 below. page 5 3: "The UKLPG or an equivalent body should prepare guidance on the general recommended practice." Again, general agreement although the HSE believes that it would be better placed to provide the guidance and I think in fact you support that not least because they can provide guidance to users rather than suppliers. A. Correct. Q. 4: "The LPG user (and if relevant the landowner/managing director) should be required to retain the relevant up-to-date information on the system." Again, with details provided. You say that it should be held on site in the safety dossier and you record the general agreement we have just talked about on the overall concept of that dossier? A. Correct. Q. Fifth: "Every party who is responsible for buried metallic LPG pipework should develop an inspection regime and take immediate measures such as cathodic protection." Again you record that there is general agreement with the need for an inspection maintenance strategy. page 6 You agree with the approach whereby the high risk pipework is identified and removed and then low risk pipework is removed progressively. May I take it from that you are supporting the approach which Calor have initiated and the work of Mr Tomlin, obviously subject to its scientific verification? A. Yes, indeed and also of course the work of J Gas as well. Q. Thank you for that. You also agree that the use of cathodic protection is one of a number of possible remedies that might be applied to certain systems pending replacement and again, I do not think I need to labour that. 6 deals with the certification or verification scheme to be introduced that requires an independent competent person to verify the integrity of the system. Verification would have to be renewed periodically at a prescribed frequency to be determined. You record Calor's concerns that verification is unnecessary and the issue is best handled by the safety dossier and extending the GSIUR to industrial premises. UKLPG expresses serious concern with the use of verification and you set out there what these are. You say that one of their concerns is that the verification scheme would externalise the accountability and page 7 responsibilities for the certification of system safety which remain with the duty holder. You say HSE does not object to the scheme in principle so long as it does not divert resources from the prioritised metallic pipework replacement programme. Then at the end of that section you say: "I proposed a verification scheme, within the overall package of recommendations, as an important means to encourage compliance by LPG users with their existing health and safety duties. Whilst there appears to be some merit in selective extension of the GSIUR to industrial premises to reinforce the issue of competency, it does not ensure the ongoing compliance of H&S duties where there is no change to the LPG system pipework or appliances." May I just confirm, Mr Sylvester-Evans, that is the critical point about the verification scheme, as I understand it, because however desirable and effective the extension of the GSIUR would be, it only takes effect if something has to be done to the system and does not provide the ongoing verification for a system that simply left undisturbed? A. That is correct and indeed things may be done, shall we say, which are not directly relevant to the system but, for example, changes in ventilation, changes in page 8 basically unventilated voids being created which actually can greatly increase the hazard and risk arising from a release. So I think it is important that the verification scheme looks at the system in the environment in which it is being operated. Q. Do I take it as one of the examples that is derived from the evidence in this case of where that precise circumstance might occur in a critical way was the raising of the level of the yard? A. Absolutely and also the creation of the basement. Q. You make it clear of course at the end that in no way should the introduction of such a scheme remove the primary health and safety duty from the LPG user and site occupier and that of course remains the position? A. That's absolutely right and I appreciate that UKLPG are concerned about the externalisation of, sort of, the duties but essentially the verification is for the LPG user to demonstrate that it has a safe design and operation and therefore that is the duty which the user has anyway. Q. It arises under the various regulations. A. Precisely and therefore in that sense the verifier who -- the importance of being independent -- can come in and say, "Yes, this ticks all the boxes; this is what I would expect", and hence it's the independence which page 9 is also a very important issue. The whole purpose being to attempt to improve and drive, encourage forward the compliance of the LPG user. Q. Of course it is the user who is responsible for obtaining the verification. A. That is correct. Q. So far as the supplier is concerned, all it does is introduce the obligation for the supplier to make sure that there is up-to-date verification before the supplier provides the LPG? A. That is the intent, yes. Q. 7 is the verification scheme should be developed jointly by UKLPG with its members and the HSE. I think again there is no dispute there. HSE believes that it should take a lead role, particularly if the scheme was to involve CORGI and their successors. By that of course we are talking about the reorganised accreditation scheme to be provided by Capita? A. Correct. Q. Do you take any exception to the HSE taking that lead, not least because of that new relationship with the Capita in relation to recommendation 7? A. No, it is a question of finding the best system and scheme which is perhaps the issue there. I realise it's page 10 very easy to say let's have a better verification scheme, it's trying to find the best process. Q. At 8 -- THE CHAIRMAN: Excuse me, Mr Martin, can I just ask: Mr Sylvester-Evans, obviously this verification scheme would have to be worked out by the usual process of consultation and discussion in the industry with HSE, but in your own mind at the moment how do you envisage it? How frequent would the follow-up inspections be? A. That is a difficult one, my Lord. I think certainly with, shall we say, during a transition period where you still have a considerable amount of metallic buried pipework, then those sites may well require an annual inspection. I mean, it is, as I've said, open for debate but if I were to put a figure on it would be annually. If, on the other hand, it's a completely PE system it may be then drawn out a little further as to the inspection frequency because -- but then it's still making sure that the environmental conditions are consistent, shall we say, and haven't eroded the safeguards and increased the level of risk on a site. I think that is something which needs debate with the industry and HSE. I think in that sense a lot depends, my Lord, on the real extent of the problem in these page 11 areas. We have seen that there's misunderstanding, there's a problem, there's a compelling need. The question is that's something that needs to be refined and I would not like to say, well, you know, it's five years or two years or three years. I think it's probably within that range but it may be extended for some systems. THE CHAIRMAN: The other matter I was wondering about is what sort of person do you envisage as the verifier? A. I would say that it is in that sense an engineer, a competent person who understands the requirements of the LPG industry, the hazards, risk assessment and also the ability to fit and change detailed pipework. So, in that sense someone who is CORGI registered for LPG but with the abilities to look at the wider issue of what can go wrong and say, "Well, hold on, are these safeguards adequate and are they being implemented". THE CHAIRMAN: That would be somebody who was not in any way connected with the particular supplier at that particular site? A. I believe it could be the supplier. You say, well, why is that then independent? Well, if the supplier has an accredited system, then that is a way around the issue, that there is an accredited system that is approved and the supplier then could provide this advice and provide page 12 independent advice. THE CHAIRMAN: So then it would be a matter for the industry to develop their own in-house systems of training and procedures? A. Indeed. THE CHAIRMAN: Thank you very much. MR MARTIN: I think it may be of assistance, my Lord, if I have page 9705 up on the screen, this is your report for phase 2 Mr Sylvester-Evans and I think you covered this in paragraphs 448 and 449 when you say: "Whilst the independent competent person is obviously responsible for providing competent and professional advice the responsibility of maintaining a safe workplace remains with the LPG user." That is the point we talked about. You then say: "Another issue that would need to be addressed would be the degree of independence required by the ICP. There may be good reason why an LPG supplier could fulfil that role if it is suitably accredited." In essence, I think that is what you just said to his Lordship. It is in the report. Thank you very much. Returning to your summary note, I think I dealt with 7. page 13 8: "All existing industrial commercial and industrial facilities are inspected and upgraded to ensure above ground entries into buildings and an ECV, pipework not routed through unventilated spaces and where not feasible acceptable alternatives are provided which must be verified by an independent competent person." You say: "There is broad agreement with this recommendation, whereby engineering solutions can be found to ensure that all existing installations are brought up to an equivalent standard of new installations." You express or you recognise that the HSE through Mrs Caldwell believes there might be some difficulty in implementing the first bullet point. What you then say is: "The important requirement is for the LPG user to demonstrate that any alternative solution provides an equivalent and acceptable level of safety which is subject to an independent review." Does that mean, if I understand it correctly, Mr Sylvester-Evans, that in a sense the achievement of the practical steps which are desirable would be an almost inevitable outcome of the verification process because either there would be no verification of a page 14 particular system if it lacked these particular characteristics, or there could be verification if the ICP was sufficiently satisfied that safety was not compromised because there were other arrangements? A. That is exactly right. It may be that because the arrangements of this particular existing situation, this existing facility, adequate and very suitable measures have been taken to run pipework through a void, through gas pipes, sleeves and so forth, and that is where verification would, in fact, say, yes, that's an acceptable alternative. Q. Because there may be in that particular situation no alternative to that if the supply is to be allowed to continue but, as you have said, particular practical steps could be taken and if the ICP verified them that would be a sufficient alternative? A. That is correct. Q. 9: "UKLPG prepares practical advice for industrial/commercial LPG users on how to fulfil their duties, particularly under DSEAR. This should be done in consultation with HSE." Again, general agreement the HSE believes it should take the lead. You emphasise the need for practical advice as it page 15 would assist any verification process. Again, am I right to understand that that is what we have just been talking about, the user who may not have any particular expertise in LPG needs to know what he has got to do, he has got to get an ICP to come along and look at his system and then create the dossier with the verification and so on? A. That is right and I have sort of alighted here on the issue of DSEAR because in my practical experience people can call for different engineering measures. There's quite a high degree of engineering judgment required and I think there is a need for practical advice and guidance, my Lord, in this area and there may be for other aspects of the regulations as well, that just prevent, shall we say, gross mismatch between requirements being said to be acceptable at one site which is of a similar nature to another site which an ICP takes a completely different view. It's really to make sure that there is practical guidance for all parties, that's the user, indeed the supplier and, in particular, also to help the verifier. Q. 10 is a process is put in place that identifies or defines for each LPG user site basically who is responsible. You refer to the fact that Mrs Caldwell yesterday, page 16 Health & Safety Executive, indicated that there is, to some extent at least, understood to be a regime exactly of that sort in existence but they are away to carry out the detailed examination and we await that and it may be entirely helpful and appears to support the recommendation but perhaps I should read you what you say finally: "In my opinion [that is to say the lack of transparency the lack of certainty] this fact only reinforces the need for the recommendation." A. That is right, specifically with that second bullet point which is who is actually responsible for the oversight of building and structural safety for existing buildings to make sure that they are suitable to meet, in this case, the LPG risks. Q. Of course we do know from my questions to Mrs Caldwell yesterday that under the Workplace Regulations, Regulation 4 (a), which you mentioned in your report, I think I am right in saying she accepted that that was in effect a health and safety requirement which was something that could be the subject of supervision by Health and Safety Inspectors irrespective of what building control officers might be required to do in a similar vein. A. That is correct. That particular amendment, I think page 17 it's in the footnote in my report was brought in under a requirement from the EU directive and there is risk of that being lost in the woodwork and, together with the fact that there's little guidance for duty holders and in particular LPG users on this fact, is I think the point that I really would like to suggest, my Lord, that there's clarity in who's responsible for what and we come on later to providing guidance in these matters. Q. 11 is: "The LPG supplier should be obliged to provide the user with a summary of its asset register." That is not a matter of dispute. 12: "The LPG user should be obliged to compile a safety dossier." Again, that is not in dispute and of course that is a straightforward statement of principle about all that we have talked about earlier, that it is under the existing regime that the occupier who has responsibility for the LPG system under the Health and Safety at Work regime has the responsibility to do the things that would bring about this safety dossier? A. That is correct. Q. 13 Guidance for the safety dossier developed by UKLPG in full consultation with HSE. page 18 There is agreement about that. You then say: "Some parties appear to suggest that the safety dossier might dispense with the need for a verification scheme. The intent of this recommendation is to provide, first, a convenient repository for data which encourages a continuity of knowledge on the user's LPG system and, secondly, a means whereby the LPG user can briefly demonstrate the safe design and operation of its system. In that sense the data contained in the safety dossier should facilitate the process of verification by an independent competent person, but it is not a substitute for verification which checks the quality of the safeguards." Let me just ask you to expand a little bit on the last sentence of that paragraph. Given that there is going to be this single body of material kept appropriately so that it is available for those who have an interest in the system and it would include things like the safety dossier elements, the design, the responsibilities, it will include the asset register and so on but it may also include the outcome of the periodic verification scheme by the ICP. Am I right in understanding that you are not suggesting there is any distinction between the ultimate page 19 outcome of these processes, it is nevertheless intended to be a single body of information kept in an appropriate way? A. Absolutely and what the verification scheme is designed to do is to look at the quality, essentially, of the arguments put into the safety dossier -- sorry, the material and the arguments that are there. Just a small point of reference, my Lord, that paragraph, it really refers to the previous recommendation (recommendation 12) and that is where we talked about earlier the need to compile a safety dossier. So it is a small point. I must have pressed the wrong button late last night. Q. 14 the Inquiry consider generally speaking communication between the LPG supplier and the LPG user and also the formation of an LPG suppliers and users forum. You recognise there is general agreement about this and you accept that it is recognised that already some LPG suppliers are providing a considerable volume of documentation. You then make the suggestion in relation to setting up the supplier and users forum, it will develop from consultations but there is also the possibility that UKLPG might wish to consider a web-based user/supplier forum? page 20 A. That's a possibility. I'm very familiar with one off-shore run by various organisations and it's called Step Change and it's a possibility of at least users, who are a very disparate group, being able to ask semi-technical and very technical questions of UKLPG and their members. The other thing is of course that there are, I think it was Mr Shuttleworth who made a very good point, that there will be certain types or classes of users who will have a particular issue or problem and then that's where perhaps a focus group or forum could be quite usefully held or set up to try and resolve those issues. Q. At 15: "HSE or whomever is responsible should publish more authoritative and detailed guidance", and you note that we are awaiting response from HSE as to who is responsible and see recommendation 10. The lack of authoritative guidance, again, I suspect reinforces the recommendation as you put it at the end of that paragraph. A. Indeed. Q. At 16: "Appropriate mechanisms are put in place to collate the existing and future data on LPG incidents for the supplier and user to actively learn lessons and identify page 21 trends, et cetera." You say: "While UKLPG has been collecting information on incidents in the past they note that this recommendation is supported fully by its members and would welcome an input from the HSE on this matter." I take that means nobody is querying that one. 17: "An appropriate mechanism to be put in place to establish, for industrial and commercial categories of bulk LPG sites ... Key statistics ..." and you note that work is being done by the UKLPG. 18: "During the transition phase, implement a basic ranking method to prioritise LPG user sites, particularly with buried metallic pipework which are deemed especially high risk." You note what we have heard about the risk-based strategy initiated by Calor and also the actions of J Gas. You accept that and agree that this must be the top priority. You also say that, in your view, assigning a top priority to the risk-based strategy should not mean that other initiatives should be put on hold. Many of the recommendations complement each other and encourage the page 22 LPG user to comply with its health and safety duties. By the other initiatives, are you alluding to the possibility that at some locations there might be cathodic protection applied in the meantime, there might be detection systems in one form or another, there are obviously all the other initiatives about the safety dossier and the provision of information. So it is all of these things, as long as they do not disrupt the replacement strategy, nevertheless, should be brought about? A. That is correct. I mean, in the broadest of senses setting one as a priority doesn't mean that it then is the first in the queue and it's a sequence. It should be done in parallel with obviously recognising the limitations of competent skilled resources initially until they are brought in and so forth. I suppose it's just a concern that I'm expressing that priorities aren't misinterpreted, my Lord. Q. 19: "The Inquiry considers a registration scheme to be introduced by LPG suppliers whereby bulk LPG could only be supplied to LPG users' sites by registered suppliers." You record Mr Shuttleworth's explanation that his members had mixed views, although both Calor and J Gas page 23 supported it. You state the UKLPG have a concern that the registration scheme should not be too onerous and should not represent a barrier to competition. You really refer to the evidence that you have given and state: "It is desirable to ensure that all the LPG suppliers are identified and, therefore, cannot operate beneath the radar. If there exists or is likely to exist in the future problems of the less safe LPG supplier who undercuts those LPG suppliers who are competing fairly and safely in the marketplace then this should be capable of speedy identification so that enforcement action can be taken." You talk about the degree of accreditation and so on being necessary. As I understand it, what is being proposed is actually potential protection to the responsible LPG supplier so that he is not undercut by somebody who is less scrupulous and prepared to supply to a potentially unsafe system. A. That's right indeed. Correct. Q. Likewise, of course, it addresses the safety of a supply to an unsafe system, whatever the effect may be on the individual supplier? A. That's right. Q. In the final paragraph there you make the point you are page 24 not envisaging a licensing regime. I think that is a matter that only came up as a suggestion in Mrs Caldwell's evidence and I think that remains your position; is that right? A. That is correct. A licensing scheme, as I note -- there are various licensing schemes for explosives and I will be corrected, no doubt, if I am wrong there, petroleum sites and nuclear installations, as well as the safety regimes, my Lord, for the railways, off-shore installations, COMAH, major hazard sites. Those represent pretty onerous requirements on both the duty holder and the HSE, the regulator. There is, in fact, a document that sets out those -- Q. I think that is what you referred to in the footnote in the main part of the Inquiry bundle but it is only for information. You are not relying upon it? A. Absolutely, just to set the background to what HSE call permissioning regimes, which is a very important document to understand HSE's approach on that. Therefore, I would say I am personally not suggesting a licensing scheme. That's probably the best way of saying it, I think. Q. What you are looking for is a register of people who can be recognised as appropriate when there is an issue over someone who has supplied LPG. page 25 A. That is correct. The degree of accreditation, I think, is there. I've made the point and that is something which needs to be, I think, addressed by the industry and HSE to work out the best form, because obviously there's one main association, UKLPG. It's a question that is a voluntary body. Some people will join and some people will elect not to and I have not had a chance to talk with those people who do not wish to join and the reasons why they do not with to join, so I'm wary of going much further at the moment. Q. I do understand that but bearing in mind that of course, as you have just said, the trade body, UKLPG, does not represent every single supplier. There has been no evidence at this Inquiry that membership of UKLPG imposes any particularly onerous obligations certainly not on Calor or J Gas who are and have been, as far as we know, always been members of the association; likewise, the other 95 per cent suppliers and, as I recall, 99 per cent of the market? A. Correct. Q. Without any in any sense suggesting directly that membership of UKLPG either should be made compulsory as the registration scheme or that by itself it is an equivalent of a registration scheme, nevertheless membership registration on the list of a body which has page 26 the activity of LPG supply as its core function does not appear to be something that is too onerous. A. Correct. THE CHAIRMAN: I think I understand the difference between the registration and licensing but I suspect there may be people here who do not. Maybe the families do not fully understand the distinction. Could you just, in a sentence or two, explain the difference between a licensing regime and a registration scheme. A. Certainly. From a licensing scheme, the HSE check and place conditions of operation, a job design and operation on a particular activity, storage of petrol, for example, or in nuclear installations. A lesser extent of that is the safety case where there is a formal demonstration by the duty holder (say, an off-shore installation owner) to explain why they believe their design is safe and their operation is safe and, under those conditions, HSE accept or otherwise reject those arguments. However, in neither way in no case does HSE take on responsibility and say yes, it is a safe installation. What it's saying is: we accept that if you operate as you say you intend to and as you are doing, then it will be safe. You have demonstrated adequately the level of safety can be achieved. So those are examples of a page 27 licensing and what would be called a permission regime. Registration really is one of making sure that there is knowledge of everyone who is supplying LPG and that there is a suitable level of accreditation so that, in essence, they are -- I will use the word loosely -- fit to supply LPG safely, managing the product and the supply of that product. Now, I appreciate that that is a very loose definition but I think that's where there is a debate that there needs to be around that, my Lord. MR MARTIN: Number 20 is the proposal to consider legislation to make it a criminal offence to supply or use an LPG system which did not have an up-to-date verification certificate. Again, you refer to the UKLPG members' concerns about this and you say that of course this recommendation is proposed in order to provide teeth to strengthen current legislation and to combat potential rogue LPG users and potential less scrupulous LPG suppliers. Again, it is the same as what we talked about a moment ago; it is intended to protect the legitimate, properly operating LPG supplier, not punish him. A. Correct. Q. 21: the Inquiry considers assigning target timescales for the implementation of its recommendations. Again, page 28 you say general agreement and indeed above that, as I recall, Mrs Caldwell's evidence yesterday was she would accept a recommendation that the developed risk-based strategy along with the timetable for it to be carried out would be in place by next June. If I recall the evidence. A. That's my recall as well. Q. I take it you entirely support that because it does seem a reasonably prompt timescale in the situation we are in at the moment? A. Yes, and certainly it is a question of rolling that strategy out as a fully working programme and monitoring its performance. Q. 22, of course, was slightly separate from the recommendation but it is the further matter which was the consideration of the option of responsibility for an LPG system as to whether or not it should be the responsibility of the LPG supplier either up to the first stage regulator or up to the emergency control valve, the options being set out in your original report. You say: "After hearing the evidence, [your] opinion remains that, for commercial and industrial premises, the preferred approach is for the LPG supplier to be page 29 responsible for tank and fittings and not for the service pipework. To be the responsible for the service pipe is (a) contrary to the Robens principle, (b) the supplier does not have management control over the day-to-day operations, and (c) has certain practical difficulties in assuming responsibility for existing pipework (such as insurance and risk assessment issues) and hence creates additional complexities. "The alternatives that the interface should be at the vapour/liquid offtake valve (Calor's current position) or at or just before the first stage regulator both have their merits. However, it is desirable for standardisation to be achieved." In that very last sentence, do I take it, Mr Sylvester-Evans, that perhaps with the exception of Calor, the industry appears to regard responsibility on its part up to the first stage regulator as the regime they adopt at the moment by and large under contract? A. That's my understanding, although it does vary as to whether it includes the first stage regulator or whether it doesn't. So there's a slight difference at that point. Q. But in any case, first your view is it should be up to the first stage regulator as a point and, as you said earlier, equally importantly perhaps there should be page 30 consistency throughout every installation? A. Yes. I mean, as I indicated there are merits in both ways. It could be to the vapour -- sorry, it's the vapour offtake in the case of ICL or it's the vapour/liquid offtake, which is Calor's current way. That is possible. It is clean and simple. It does leave high pressure piping between that point and the first stage regulator, which should be small, shouldn't really be part or form part of the -- well, it will be actually part of the PSSR regulations and that just adds a little bit of a complication to the user perhaps. But, in essence, there are merits in both ways. One is very simple, the other is pretty simple and there's just a little bit of toing and froing between the two. They would both normally be under the security hood and because in fact there's the code requirement that the first stage pressure regulator should be as close as possible to the output valve. Q. If I may just, if I can, pin you down because you have made it quite clear that the best approach, which is probably best in line with current practice anyway, is that the LPG supplier should be responsible up to the first stage regulator. Can I just ask you is it your view that the supplier should be responsible for the first stage regulator or not as part of that overall page 31 responsibility? A. The problem with the first stage ... there is an element of the use at a commercial installation of adjusting the pressure regulation and it may be, therefore, for some installations useful for that to be a user situation. So I can see up to the first stage regulator is sensible. I will be quite honest: so long as there's clarity, that is the key point. Let's not try to duck the issue. I think there will be, as I say, minor merits in all directions. So long as it is simple and clear is the key thing and I think it's really for the industry to say that's our preferred view, go for standardisation. Q. You would certainly say responsibility on the supplier should be up to the first stage regulator because thereafter there are various permutations we have heard about. There may normally be a first stage and a second stage regulator but, as I recall the evidence, in some cases there may be only a single regulator and indeed in others I think there might be three regulators. So at the very least if the pipework up to the first stage regulator was the point at which the interface existed, that would apply to every system, however many regulators it had? A. Yes, I think in the vast majority of installations, as page 32 we see in front of us, it makes little difference, to be quite honest, because the length of pipe is very short. But of course there will be those incidents where the first stage regulator for some reason or other, because perhaps there were dual tanks or multiple tanks and it is still sitting out as it was in ICL, a little remote from the tank, under those conditions I would ... well, again I go back to my original point or original sort of view. It's for there to be clarity, I think, is the key thing. If I were to choose, I would choose up to the first stage regulator but I think it's an industry decision. MR MARTIN: Thank you very much indeed, Mr Sylvester-Evans. My Lord, I have no further questions. Examined by MR MCBREARTY Q. Mr Sylvester-Evans, I have a number of questions on behalf of Mrs Ferguson and Mrs Smith. You may have touched upon some of them already this morning but, just for the sake of clarity, firstly in relation to verification schemes, can I take it from your answers this morning that you do not see the verification scheme as being merely of use in the period during which the replacement of metallic pipes is ongoing/ A. No. No, I see this extending into the future after the replacement programme has finished. page 33 Q. You have mentioned that there may be an issue as to the frequency of the verification scheme hereafter but you do see it as being of some utility, even in relation to polyethylene pipes? A. Indeed because, as we have seen, environments can be changed in which the system is being operated, let alone changes to the actual system. From my own experience and experience I know of many companies and indeed the HSE, it is the lack of control and change and modifications that often erode perfectly good safety safeguards that were in originally but they are eroded over time; so hence the need to independently verify that those safeguards are adequate. Rather like an MOT in that sense. It obviously shows at that point in time the safeguards are adequate. You can't be there all the time but at least it is a check. Q. In this phase obviously there has been quite a bit of evidence heard about replacement strategies and some emphasis has been placed upon that as being of great significance. No doubt it will be appreciated that those who are most affected by the ICL explosion will be anxious to know that there are no problems with existing installations in the meantime while the replacement strategy is ongoing. I wonder perhaps could you just for the sake of page 34 clarity confirm in your view what the most important issues are in ensuring that there are no problems in the meantime and perhaps just confirming how you believe there can be clarification of the problems which exist? A. Well, essentially as I was reviewing the findings of fact, shall we say, that were presented and compiled after Phase 1 and looking then to the existing duties, I in that sense compiled and generated or created the suite of recommendations that we have as proposals before us. I think that is the key point, that it is an integrated set which I have tried to make sure is there for good purpose so that they encourage clarity of who is responsible for what; they encourage the ownership of the problem of checking the integrity and so forth by those who need to (ie, in particular the LPG user); they encourage the knowledge and use of competent people to do the work and there is a verification, there is an independent check, to monitor how this is going on. So this is why I said that a key issue is to have these being rolled out not in series but in parallel with the ongoing, very important work of prioritising and replacing high risk buried pipework. So the general question, I hope that answers the point. page 35 Q. Just picking up two particular points, I assume that you see there being some significance in the importance of getting as much information out to the users of LPG as possible? A. Absolutely. It's part of one of the recommendations or several of the recommendations are encouraging just that. Q. And on the second particular issue, I know that you mentioned gas detection systems this morning but, again, could you perhaps just reiterate where you see that as fitting in the general scheme? A. Well, gas detection systems have their place. They are important in certain cases and, for example, if there were identified at a site an unventilated void where an escape was reasonably foreseeable and the gas detection system could be put in there as a temporary measure before, shall we say, a better engineering solution is found. That's not to say that gas detection is not a good engineering solution. It is, I will call, a secondary solution. The primary solution must always be there to prevent and contain a release (ie, loss of containment is the problem, the integrity of the pipework or valve on the system is crucial). However, gas detection is a very useful technique and can be applied particularly where page 36 you have multiple valves and points of potential release, where you can then install your detectors at a suitable level (typically low level in a sump) and that can be a permanent engineering safeguard so that it registers an alarm and provides a warning and then, if necessary, shuts down the supply of LPG wrecks. But that is quite a sophisticated system but may well be warranted for various industrial sites. So that's the approach. It's there in the, I would say, using Dr Keynes words, the tool box for the application as a good credible safeguard. But it is in that sense secondary. Q. Would it be correct to say that when you speak about a "suite of recommendations and requirements", that in a sense that ties in in that if there is a need in a particular installation for a gas detection system one would expect that to come out perhaps as part of the verification scheme? A. Undoubtedly. It would be part of the justification by the LPG user that this is why we believe we are operating safely to the design and the verifier will make sure that yes, the system in that sense is being contained and is fit for purpose, ie if it's trying to detect direct a leak, it's not up in the roof space somewhere when it's supposed to be detecting an LPG leak page 37 at ground level. Q. Lastly, just on the question of timescales, obviously we have heard evidence yesterday from Mrs Caldwell that it would be possible to put together a replacement strategy by next June. Do you have any view on possible timescales for your other recommendations and, in particular, if I could mention the safety dossier and also verification scheme? A. A trite answer would be as soon as practicably possible which is not helpful if you, my Lord, and I appreciate that. In principle, what I've said in the report already is that there's consultation with the various stakeholders, HSE included, and the suppliers and the users. But this has to be motored through. I think this is the point. It has to be driven actively, managed, performance and activity monitored because I've mentioned the term paralysis by analysis. You can get heavily bogged down in some of these areas and there may be people who will say "What about this, what about that" and there are lots of different parties who have a view. But that is why there is need to be a definite lead and a definite programme to drive it through. MR McBREARTY: Thank you, my Lord. THE CHAIRMAN: Mr Macauley, do you wish to ask any questions? page 38 MR MACAULEY: No thank you. THE CHAIRMAN: Mr McBride? MR MCBRIDE: No, my Lord. THE CHAIRMAN: Mr Gray? MR GRAY: Thank you, my Lord. THE CHAIRMAN: It is three minutes to one. Do you want to wait until after lunch. MR GRAY: Yes, that might perhaps be convenient. THE CHAIRMAN: We will start at 2.00, please. (12.57 pm) (Luncheon Adjournment) (2.02 pm) Examined by MR GRAY MR GRAY: Thank you, my Lord. Mr Sylvester-Evans, good afternoon. You have obviously recommended a number of measures in your report and as I understand your evidence from your own perspective it is important that those recommendations should not be seen in isolation but looked at together. Is that correct? A. That is absolutely correct. To start cherry-picking shall we say creates the possible imbalance between the sort of package that I am suggesting the Inquiry considers. Q. By that do you mean that if there were any one page 39 particular measure which was not adopted that there would be the risk that the overall effectiveness of the package of measures could be reduced? A. That is correct. Again, it all depends on the overall need but from the evidence that I have seen, for example, if verification wasn't adopted by an independent party then question, rhetorical question, would one be achieving the degree of compliance by the LPG user that is being sought? Q. Let us just take the verification scheme as you raise it. As I understand from your evidence this morning, one of the most important benefits of the verification scheme is that it would check the quality of the safety dossiers? A. Precisely. Q. Would you agree with me that if even some of the measures which you recommended were introduced that there would be the potential that, however conscientious the efforts were, that the quality of the safety dossiers initially may not be of the standard that one would wish? A. I think that is quite possible and until the system beds down and the users gain the confidence and the knowledge and indeed the experience that they should have and perhaps were lacking to start with or currently, then page 40 there are likely to be aspects where the quality is lacking. Q. Would that lack of quality also arise because if there is, as there appears to be, general agreement a programme for replacement of pipes which are at risk that there is at the very least going to be a resource the problem and the need to recruit a number of appropriately qualified engineers who, whilst they may all be CORGI registered engineers, would not necessarily have particularly great practical experience of working with LPG? A. That is absolutely correct. Q. Does it follow from that that whilst initially in any replacement programme replacement of pipework would be carried out by CORGI registered engineers but who may be new to LPG, that equally if safety dossiers were introduced the compilation of those safety dossiers in the early years may be by CORGI registered engineers who would not have the same degree of experience as, say, for example, engineers employed directly by J Gas just now who are engaged in LPG installations every day of their working life? A. Yes, I agree. Q. Would you agree with me that the concept of the safety dossier is only really of value if the contents are of a page 41 requisite quality to ensure that risk is reduced? A. That is the optimum position. Obviously, as the information is gathered the knowledge is being gained by the user but if the quality is poor, the understanding is poor it is, therefore, suboptimal. Q. Therefore, to ensure the quality, if one has the verification scheme in place, does that provide that assurance? A. That is what it's intended to do. Q. You spoke this morning about the relative merits or otherwise of the registration scheme for gas suppliers as opposed to a licensing scheme. As I understand your evidence, one of the principal reservations you have about a licensing scheme is that it would represent an onerous burden on the industry and on the safety regulator, the Health & Safety Executive? A. That is correct. Q. Insofar as the registration scheme is concerned, if the registration scheme were reinforced by, as you suggest, another measure, namely accreditation, and further reinforced by another measure which you recommend, namely that it be a criminal offence for any accredited or registered supplier to supply LPG where there is not an up-to-date verified safety dossier, if those package of measures were taken together, do they give you the page 42 comfort of taking the view that a registration scheme would be preferable to a licensing scheme in all the circumstances? A. It would, yes. Q. The only other matter that I wish to ask you some questions about is the issue of the last thing that we dealt with today, namely the responsibilities of suppliers for pipework and where it would end. My recollection of your evidence is that your final view was that as long as there is clarity, that was the most important thing. I just want to try and achieve some clarity for my own purposes. Can I be clear about this: is it your opinion that for commercial industrial premises the preferred approach from your view is for the LPG supplier to be responsible to the tank and fittings and not for the service pipework? A. Correct. Q. So the only area where you yourself have not reached a final conclusion is as to whether that responsibility should extend up to the first stage regulator but not including it or whether it should extend up to the first stage regulator and including it? A. There is also the other alternative which is just at the exit of the vapour offtake valve. page 43 Q. Very well. So the Calor position? A. The Calor position. As I say, there are benefits or merits in each and I think it really is an industry decision. That's my personal view of exactly where you draw the line. The simplistic view is at the offtake. It's the easiest but there is also good merit that you have the high pressure piping up to the inlet of the first stage regulator. So I think it's -- well, I think that is probably best left to the industry without sort of trying to dodge the issue, if I may. Q. Very well. But you are clear that you are not inviting anybody to take it that it is your view that that responsibility should extend beyond the first stage regulator? A. Oh absolutely. Q. Very well. One other matter is do you have it in mind that that responsibility, whether it be to the offtake valve or to the first stage regulator or whatever point, that it should only apply to suppliers who own the tank which they have supplied? A. Oh absolutely, precisely. Sorry, yes. There are situations, my Lord, where the customer, the LPG user, perhaps because of historic conditions and reasons, own page 44 the tank themselves and under those situations -- and I think I'm not sure of the actual number of installations but they are very small that I am aware of but they do exist -- under those conditions, the LPG user effectively has the tank and is responsible for all aspects of the regulation of the tank and so forth, rather like, I suppose, any other bulk storage of solvents and everything else they will own a tank and the supplier comes in, hooks up to it under the control and management of the site and fills the right material into the right tank. MR GRAY: Thank you very much, Mr Sylvester-Evans. I have no further questions, my Lord. THE CHAIRMAN: Mr Gray, are you going to be putting forward a view about where the responsibilities of the supplier should end? MR GRAY: I certainly will in the course of my submissions. THE CHAIRMAN: Mr Sheldon? MR SHELDON: I have no questions for this witness, my Lord, thank you. THE CHAIRMAN: Mrs Stacey? Examined by MRS STACEY Q. Mr Sylvester-Evans, do I understand from what you have said at the Inquiry, both in writing and when you have given evidence, that you believe that the best way to page 45 implement the recommendations which you have made with no cherry-picking as just discussed with Mr Gray is to have the industry and the HSE, as a matter of urgency, sit down, talk, work out what is best and get on with it? A. Broadly, yes. Q. Is it necessary that the HSE and the industry do sit down and talk because they are the people who know about the way in which the industry actually works? A. Yes. Q. In thinking about a verification scheme, I take it that it would be necessary to work out what it is that you have to verify? A. Indeed. Q. That I suppose would give you a template for the safety dossier, would it not? A. Yes, indeed. Q. Because when you were speaking with Mr Martin earlier this morning I think you were confirming what I hoped I had understood correctly, which was that the safety dossier and the verification scheme are not two completely separate things. A. One supports the other and if I may just clarify, as I think I did in my written note which was circulated this morning, the safety dossier is basically the repository page 46 of information, data, certificates and so forth and also effectively a brief demonstration by the user of why their LPG system is safe by design and safe by operation. That package effectively forms -- sorry, would be examined by an independent competent person as part of the verification process. Q. Can I go then to that part that you have just spoken of, the examination by the independent competent person. If I understand you correctly, it will need to be worked out that that person will have to be knowledgeable about pipework, to take an example? A. Yes. Q. And he will also have to be knowledgeable about buildings, will he not? A. He would have to be knowledgeable about the formation and accumulation of or the potential formation and accumulation arising from gas leaks. Where it comes down to the building issues, then that's up to the user to be able to show that he has guarded against potential for an explosion and that he has considered the building issues. Now, from a verification point of view, that is an area which will need to be sorted out and I think that's where perhaps guidance is needed. page 47 Q. Yes. You see, I was wondering is it necessary to discuss, do you think, I do not mean between you and I this afternoon but the industry and the HSE, as to take an example that might have some relevance to what happened in the disaster here. We know that there was an unventilated basement created? A. Indeed. Q. Would the verifier, whoever he may be, ask the user, "Have you in the course of this year", or whatever the period is to be, "created any basement"? A. Well, has he changed or has the user changed any condition whereby the accumulation can enter into an unventilated void, the answer is, yes, that question should be asked. Q. What do you envisage, please, will the verifier take a note of the answer and then go and walk round the building and examine or will he take the user's word for it? A. There, I believe it's a question of extent. If there is said to be no change, you will have to -- there is a need to broadly walk the system to ensure that what is in the dossier is there in practice. That is a simple exercise or relatively simple on a small site. I appreciate that becomes more complex on a complex installation. page 48 Q. So is that a subject that you would expect to be part of the discussions that you envisage happening with the industry and HSE as to how exactly that is going to be done? A. Yes. Q. I think you have also indicated that the things that would be in the verification scheme and the safety dossier, so far as you are concerned, that would mostly be, if I have this right, part of the law already, if you like? A. Well, certainly laying out the responsibilities so there is a clear view as to who is responsible for what and in particular from the user's point of view setting out those responsibilities and how the user is in fact meeting them. Q. You will appreciate, I am sure, that for very small businesses, those who employ less than five people, the law at the moment has certain requirements that they do not have to write down some risk assessments that bigger companies do have to write down. You will understandably what I am talking about without going into detail. A. I fully appreciate that, yes. Q. So would I be right in thinking then that the position of these very small undertakings, small businesses, will page 49 have to be worked out also in detail? A. I agree. I mean, the burden must be made as light as possible but commensurate with the risk. Q. When we come to the idea of the registration scheme which has been described, I think, by his Lordship as registration schemes inevitably move in to becoming accreditation schemes. I think, when you first gave evidence, there was some questions from his Lordship about that. If that is correct and if the registration scheme is not just a matter of a company putting its name on a list as someone who wishes to be in the LPG industry, if there is more to it than that, who do you envisage doing the accreditation? A. That I think is again open for discussion. In a simpler form, it may be through -- well, I was about to say that it's part of UKLPG's perhaps function but then that's a problem with one trade association. It could be an independent group. Q. Perhaps I can say, Mr Sylvester-Evans, I know you have had the chance to not only be here and hear the evidence but I suspect you have read what has been submitted carefully also so you know that the HSE in Mrs Caldwell's statement has given an appendix which shows there are a variety of ways already existing of doing this, are there not? page 50 A. There are. Q. Again, would you regard it as reasonable that the exact way in which it is done is something that has to be worked out with the HSE and the industry together? A. I think it's preferable for it to be done together. I mean, the emphasis ... yes, the accreditation scheme I think is ... I'm not seeking or wouldn't necessarily suggest a hugely elaborate scheme. I think that's what I'm trying to get across really because the key thing is to ensure that, depending on the extent of the problem of potential small suppliers who are less scrupulous, if I may put it that way, if depending on that level of threat of risk then getting them on the radar is the key issue and then some form of soft accreditation to ensure that there is the way forward to start with. But I think that's something that may well can be strengthened depending on a review process, if it's needed to strengthen the accreditation because of the way the system, the regime is working. It must be dynamic enough to say, "I think we need a little bit more. We need to review this and apply a little heavier, slightly stronger touch to the accreditation". Q. Yes, because so far as the Inquiry has yet seen there is not any evidence of any rogue operator, small or otherwise, out there, is there? page 51 A. Not as far as the Inquiry has heard, no. Q. So that is something that would need to be considered. Again, the industry would need to work out with the HSE how much of a problem actually is that? A. That's right and that's how I framed it within the report. Q. Can I just make sure then that I have this right, that basically your view of the HSE, that the real important priority that has to be attended to, and you know the deadline or the suggested deadline that Mrs Caldwell gave, is a to get these pipes that may be out there identified and replaced? A. Oh absolutely. The identification is essential but it doesn't stop all these other people, other actions going forward. Indeed, we have the examples of J Gas who have got on and identified the pipes themselves without using a risk-based system. MRS STACEY: Thank you, Mr Sylvester-Evans. I have nothing further. THE CHAIRMAN: Just on that point about accreditation, Mr Sylvester-Evans, if all that were to happen was to introduce a simple registration scheme, then presumably you might as well just put a list of registered suppliers in the Yellow Pages. It would tell you nothing about the quality of what was being offered. page 52 Would you agree that registration is a necessary first step or a necessary concomitant of some form of accreditation? A. Yes, in simple reply. It is, I see -- once people are on the radar, once there is knowledge that there is the supplier supplying perhaps a small number then, sir, the request can go out so it's brought within the system of the risk-based prioritisation model. It is also brought into the awareness of the HSE and, in that sense, it provides knowledge to the industry that there are these groups of people out there. I think, as I say, some degree of accreditation would be desirable. I think that is the word I used when I first gave evidence, my Lord. THE CHAIRMAN: I think everyone has had an opportunity to ask questions. Re-examined by MR MARTIN Q. I wonder if I might just ask you, Mr Sylvester-Evans, probably just a few questions arising out of the questions you were asked by my learned friend Mrs Stacey. Supposing there is no evidence of a rogue operator who might ever have supplied into an unsafe LPG system before this Inquiry; is that a reason for you to depart from your proposal that the possibility be addressed page 53 either by a registration scheme or by the creation of the criminal offence that you have talked about? A. No. I know that there has in the past been concern about someone setting up, a couple of individuals, perhaps, just setting up a small business, which is not a problem. Their competence is the key issue. In essence, I suppose, with any new regime there is always -- we're in a very competitive market and I list some of the issues in the report in section 2 which the current regime faces and therefore I think I am aware that this is an issue that should be monitored and handled by the new regime to make sure that fair and safe LPG suppliers are not disadvantaged. Equally, there is no barrier for competition for people to enter. I think that's where I ... so the answer is there is still purpose in the recommendation. Q. Casting our mind back to Phase 1 of this Inquiry, and it has not been explored in any particular detail, but we know in circumstances unexplained that somebody connected two free-standing gas cylinders into the system in question. It had no contribution to the events which occurred but, on the face of it, that is a demonstration of the fact that it is relatively easy for somebody, should they want to do so, to connect LPG gas itself and feed it into a system when otherwise no page 54 official supplier or if there were a certification scheme, any verification existed for the scheme? A. That's correct. Q. So we are dealing with something that, in practical terms, is relatively straightforward for somebody motivated enough to want to do it? A. Unfortunately, that is the case. MR MARTIN: I have no further questions. My Lord, that concludes the evidence before the Inquiry. Although I am pretty certain I intimated previously perhaps I can just confirm that for the purposes of Phase 2 and with the agreement of parties and the provision of certain additional written information, the Inquiry statements of Mr McNab and Mr Pappard are to be taken as part of the Inquiry record. I think I did make that clear previously. My Lord, that now concludes the proceedings so far as the evidence is concerned. If your Lordship would wish me to do so, I can just say a very little about what I see as the proceedings which are to take place in accordance with the notice next Thursday. THE CHAIRMAN: Yes, please, Mr Martin. MR MARTIN: My Lord, the notice to core participants has indicated that closing submissions will be taken from core participants to be heard next Thursday, texts to be page 55 provided to the Inquiry and other core participants at the time of presentation. The order of closing submissions has been set other as Calor Gas, Johnson Oils, Health & Safety Executive, ICL Plastics and ICL Tech, Mrs Ferguson, Mrs Smith, Mrs Russell and Mrs O'Brien, should they choose to make a submission, and the Inquiry has offered any assistance that might be required, and Mr Macauley, finally, on behalf of injured survivors and the bereaved families whom he represents. In order to set the scene for that process, my Lord, it is my intention before the closing submissions are delivered to set out very briefly in oral submissions what counsel to the Inquiry see as the matters upon which it is likely that the Inquiry will need to reach conclusions. That will apply both to matters which occurred in relation to the evidence in Phase 1 and in Phase 2. I should emphasise, my Lord, that it is not intended or it is not like to be intended to be necessarily an exhaustive list of the issues which are before the Inquiry but the purpose is, at the very least, to give those who are making oral submissions an indication of any matter upon which they might not be covering themselves and, therefore, before the proceedings are page 56 closed an opportunity to say something about that. I should also say that the procedure is without prejudice to the possibility of warning letters being sent in accordance with Rule 12 of the Inquiries Rules. I should simply say I am not indicating that any warning letters will require to be sent but the procedure which I am proposing will be without prejudice to that possibility. I should emphasise that, as counsel to the Inquiry, it is not my intention to make any substantive submissions on any of the matters which I propose to identify because, ultimately, it will a matter for your Lordship to reach his conclusions based upon the evidence but assisted by the submissions which it is hoped will be provided by the core participants that I have referred to. So I emphasise it is not intended that what I shall be providing will be any more than a list of matters which Counsel to the Inquiry see as being appropriate for consideration in due course. I do not expect that to take particularly long, my Lord, and it is hoped that, as with the core participants' submissions, a written text can be provided at the time. If your Lordship is agreeable to that procedure, then that is what I suggest takes place when we resume next Thursday morning. page 57 THE CHAIRMAN: That seems an excellent suggestion, Mr Martin, and I think that would be very helpful to me. Are there any other matters that anyone wishes to raise in relation to next week? It should be a fairly straight forward process from here on in. Please do not prove me wrong. In that case then we will adjourn the Inquiry until Thursday next. (2.33 pm) (Adjourned until 10.30 am on Thursday, 13th November 2008)