Fire

The cost of getting it wrong.

Integrated Risk Management Planning has huge potential, however this potential will only be realised if it is translated into meaningful planning and actions which are based on a clear understanding of the principles and systems which underpin effective risk management. The outcomes anticipated as a result of the shift to integrated risk management planning are a reductions in loss of life and injuries as a result of fires and other emergency incidents, a reduction in the occurrence of these incidents, a reductions in the commercial, economic and social impact of these incidents, the safeguarding of the environment and the provision of a fire & rescue service that represents value for money for the community. Fire & rescue authorities now have a unique opportunity; and one which is quite simply too good to miss. However as with all opportunities, it must be embraced and developed to ensure that its full potential is realised.

Fire & Rescue Services in the UK are highly regarded amongst public and business alike. A survey of business leaders published in February 2004 found that overall there was widespread dissatisfaction with public services in general. Of eleven public services administered by central or local government, the Fire & Rescue Service was the only one to escape criticism, with 74% of employers rating it as good or very good. The Service remains universally well-regarded, however this current enviable position could change if mistakes are made in Integrated Risk Management Planning.

The Cost to the Community

Home Office research put the annual cost of fire in England and Wales at 6.9 billion [pounds sterling] in 2002. Fire material damage and related business interruption costs totalled 1.4 billion [pounds sterling] in the UK in this year, the third consecutive year these costs have risen. The cost of arson contributes 2.1 billion [pounds sterling] to the total cost of fire, and insurers estimate that arson results in insurance claims totalling 700 million [pounds sterling] each year in the UK.

The public sector estate gives rise to a significant proportion of fire and arson losses. According to Government statistics there were 2,284 fires in schools in 2001. There are 20 arson fires per week in the schools sector, or three every day across the UK. School arson represents 15-20% of the value of arson insurance claims, completely disproportionate to their representation in the building stock. Research carried out by the Association of British Insurers (ABI) shows that one third of these arson attacks now occur during school hours whilst pupils are in the buildings.

Public administration buildings, homes for the elderly and children's homes, recreational and cultural services accounted for 6,325 fires, or 5.6% of total fires in 2001. This places a triple burden on Council Tax payers. Firstly they lose the use of these public facilities; secondly they must fund rising insurance costs driven by these high incidence levels; and thirdly they have to support fire & rescue services who must be resourced to respond to heavy demand in this area in addition to being resourced to carry out their other preventative and emergency intervention activities.

In the same year there were 637 arson fires in hospitals in the UK. Many hospital fires are discovered and dealt with quickly, but the potential for tragedy is worrying, quite apart from the unnecessary drain on over-committed National Health Service budgets.

The insured cost of domestic fire claims was 351 million [pounds sterling] in 2002. This figure has risen by an average of 5.2% a year since 1988. These statistics demonstrate that little real impact has been made in reducing domestic fire property losses despite public and private sector fire safety campaigns. Whilst 81% of all homes have fitted smoke detectors, only 59% of homes suffering a fire in 2001 had smoke detectors fitted. Additionally around 25% of households (and 50% of households in the lowest income decile) have no household insurance.

The cost of fire falling on lower income households will therefore be under-represented in insurance claims figures. Government research suggests that socially deprived households are 31 times more likely to suffer fires than households in general, and these households are 16 times more likely to suffer a fire death than an 'average' household. The National Community Fire Safety Centre has shown that social classes D and E are less likely to own smoke detectors than other social classes.

Whilst life safety is the first priority of the fire & rescue service, protecting the economic assets and capacity of the nation must also be taken into account in local IRMPs. In drawing up IRMPs and risk maps as predictive tools for future fire and other emergency incidents it is important to accurately assess potential hazards rather than being driven by historic events. Risk assessment must take account of the wider impact or damage that will occur as well as the probability of something happening.

Many businesses never completely recover from large fires: as many as 90% of businesses fail within 12 months of a major crisis such as a catastrophic fire. Around 8 in 10 large fire losses occur in businesses with less than 100 million [pounds sterling] annual turnover. From an insurance perspective, the greater the probability of a claim, and the larger the likely size of that claim, the higher the insurance premium that must be paid. Businesses can directly benefit from reduced insurance costs by controlling both risk and impact, although it is unlikely that many of these businesses have in-house risk management expertise. This has clear implications for the promotion of preventative measures in businesses, particularly as the new 'risk-based' approach to statutory fire safety inspections will be a major factor in local Integrated Risk Management Plans.

There remain however elements of risk management which impact on insurance costs that can only be influenced by external agencies. These include social and economic policy, building regulation and control as well as adequate resourcing and deployment of police and fire & rescue services.

Business leaders have expressed concern over proposals in some first year IRMPs to alter fire & rescue service responses to emergency calls generated by Automatic Fire Alarm (AFA) systems. They fear that such changes would place business at greater risk from the damaging effects of fire.

The issue of unwanted fire signals generated by AFA systems is not new. There have been numerous studies, reports and proposals over the years into how best to deal with this problem. Integrated Risk Management Planning provides the opportunity to look at this issue again, not from the perspective of the effect of any strategy on the former Standards of Fire Cover response standards, but (more appropriately) from the perspective of wider risk management. Section 9 page 98 sets out such a risk-based approach for reducing the impact of unwanted fire signals.

For many areas of the UK, safeguarding the economic base of the community is a high priority. The social and environmental impact of business closures and re locations can be significant. For many businesses experiencing a significant fire, it may actually be cheaper to re locate to other areas of the UK rather than re-building in-situ. The increasing availability of local start-up grants, and the potential of lower insurance premiums as a result of, for instance, a more robust risk based legislative enforcement regime or better fire & rescue service emergency intervention response standards will be factors taken into account by these businesses when considering whether to re-build or relocate.

Considering both risk of fire death and risk of other fire losses it is clear that it is the most vulnerable in society who face the highest risk of fire, are the least prepared for fires, and have the least financial protection. They are also amongst the most likely to lose their jobs as a result of fires in commercial premises, and as the least skilled they will generally be less likely to find replacement employment quickly. The potential impact of these interrelated factors on a local community is enormous.

The Costs to Fire & Rescue Authorities

Until now, Section 1 of the Fire Services Act 1947 (as amended) has remained almost peripheral, acting as a preamble to the prescribed requirements of Section 19 of that Act. The implied requirements under Section 19 were that fire & rescue authority establishments must be capable of making emergency responses in line with the requirements of the former National Standards of Fire Cover. However, with the repeal of the majority of Section 19, Section 1 will become the primary control mechanism to enforce the new IRMP duties upon fire & rescue authorities.

It is clear that the fire & rescue service has no general immunity from third party proceedings. In the case of Capital and Counties Plc v Hampshire CC the Court of Appeal rejected the argument by Hampshire that there should be a general immunity based on public policy. That case concerned a claim brought alleging 'operational negligence' at incident level where a sprinkler system was judged to have been isolated in direct contravention of fire & rescue service Standard Operating Procedures, thereby creating or increasing the danger and consequential loss. It was established that Hampshire were liable in such circumstances.

Where a fire & rescue authority actively seeks to make savings under a local IRMP by establishing lower emergency intervention response standards as a basis for station closures, personnel cuts etc. then any challenge would be based on public law rather than specific liability. Section 1 of the Fire Services Act 1947 (as amended) refers to securing 'efficient arrangements'. Such a measure of 'efficiency' will undoubtedly include an analysis of how well emergency intervention response standards within local IRMPs compare with former National Standards of Fire Cover.

Where Section 1 is not complied with, the IRMP itself and the deployment of resources based upon that IRMP would properly be regarded as unlawful. Those members of the public and fire & rescue service personnel killed or seriously injured in consequence of an unlawful IRMP may then seek to pursue legal remedies in respect of their consequential losses.

An inadequate emergency intervention response, arriving at a later stage, will place operational personnel in a far more difficult position than an appropriate response arriving at an earlier stage. There will be a far greater likelihood of creating or increasing the risk of fatalities, serious injuries and avoidable property damage. The risk of legal liability, civil and potentially criminal, will correspondingly increase in such circumstances. Whilst criminal prosecutions, such as corporate manslaughter, will inevitably arise only in extreme circumstances, the removal of the 1985 Standards of Fire Cover will remove a layer of legal protection which formerly amounted to a form of partial immunity.

The transfer of responsibilities from central government to fire & rescue authorities and from fire & rescue authorities to principal officers will inevitably focus legal duties upon principal officers. The ODPM has not sought to provide an immunity in respect of these liabilities and duties. Indeed, it would be inconsistent with the policy of the ODPM, as evidenced by the Independent Review of the Fire Service, the 2003 White Paper, ODPM Guidance Notes on IRMP's, legislative amendments etc, to seek to do so. The law would regard responsibility as carrying with it the appropriate legal liability, and the fire & rescue service is not immune from this general principle.

The Management of Health & Safety at Work Regulations

Until very recently employees had no power where an employer failed to carry out a risk assessment. This position was changed when a new Section 22 was introduced to the 1999 Management of Health & Safety at Work Regulations by the 2003 MHSAW Regulations. The new Regulation 22 states:

"Breach of duty imposed on an employer by these Regulations shaft not confer a right of action in any civil proceedings insofar as that duty applies for the protection of persons not in his employment."

This means that where an employer fails to implement his duties under the 1999 Regulations this will give rise to civil liability insofar as it applies to protection of employees.

This has three very important implications:

1. Where an employer fails to carry out a risk assessment at all and the Health & Safety Executive (HSE) fails in its duty to enforce this requirement, and an employee suffers personal injury in circumstances where it can be established that had a risk assessment been carried out it would have highlighted the danger and the need to introduce control measures, the employee will have a right of action for damages against the employer. …

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