Increase in IPC, air pollution control fees

Most companies subject to integrated pollution control (IPC) face a sizeable hike in the fees they will have to pay to HM Inspectorate of Pollution (HMIP) this year despite last-minute reductions in the level of charges proposed by HMIP in January. Industries subject to local authority air pollution control face smaller increases in charges.

The cost-recovery charging scheme under IPC came into force last April. HMIP's proposals to raise the level of charges for 1992/3 - involving a 110% increase in the fee for an application for an authorisation, and a trebling of the annual "subsistence" charge - provoked heated protests from industry in February, even though it is obliged by law to recover its costs in determining applications for authorisations and monitoring compliance with them (ENDS Report 205, p 27 ).

Details of the final charge levels for 1992/3 were circulated to industry in mid-March, and subsequently confirmed in a parliamentary answer by Environment Minister David Trippier.1 The figures are shown in the table.

In most cases the charges are lower than those originally proposed. The reduction in the proposed application fee to £3,650 per process component reflects an efficiency target which HMIP, with curious timing, set itself after issuing the charging proposals. It is aiming to cut the time it takes to process applications by 12.5% in 1992/3.

Operators of processes which are already regulated by HMIP under existing air pollution control legislation will face a lower than anticipated increase in their application charge when they come under IPC. When the charging proposals were issued HMIP assumed that it would take about 20% less time to process their applications. However, with more applications now determined, it believes that these will take 33% less time.

The "clawback" charge will apply to those processes which received IPC authorisations in 1991/2. The cost of determining these was underestimated by HMIP, and since it is obliged to recover its costs in full it proposed that this should be done by an additional fee spread over two years. This will now be done over four years instead, with the charge level again being differentiated between processes new to HMIP and those it controlled under old legislation.

Announcing the new charge levels, Mr Trippier said that "for the longer term, we wish to consider the option of moving to a system of direct charging for IPC applications according to the time and costs incurred in dealing with each application."

In fact, according to Dr David Slater, HMIP's Director, the change is likely to be made next year. A time-recording system is now being introduced within HMIP to pave the way for the new system.

The switch may provide an additional financial incentive for companies to submit improved applications for IPC authorisations. The poor quality of many of the initial applications over the past 12 months has undoubtedly extended the time needed to determine them. However, Dr Slater was careful not to raise applicants' hopes too much. Application handling times are already "pretty close to the minimum," he says, and while better applications will help they are likely to make a difference only at the margin.

Companies may find HMIP more receptive to requests for inspectors to clarify what will be expected in their applications. Under Dr Slater's predecessor, inspectors were discouraged from talking to prospective applicants as part of the new "arms' length" philosophy of regulation. Dr Slater says there has been "no departure in principle" from this approach, but adds that he "wouldn't discourage a pre-application meeting", on the understanding that the outcome will be recorded in the public register. "At the end of the day we are interested in getting good authorisations written and out," he says, "and it doesn't serve anyone's purpose if we dance around each other for ever."

A new scale of charges was also announced by Mr Trippier for processes subject to the new air pollution control regime operated by local authorities.

Last year's fee for an application was £800, while the annual subsistence charge was £500. The local authority associations claim that these have proved insufficient to cover their members' costs. The fees for 1992/3 have been raised to £900 and £550, respectively.

Fees for applications for processes undergoing "substantial variation" and for processes which were previously regulated by HMIP have been raised from £530 to £580. Application and subsistence charges for small waste oil burners both remain unchanged, however, at £100.

Fees for processes regulated by HMIP under the Radioactive Substances Act 1960 will also rise in 1992/3. In most cases the fees for applications are slightly lower than those proposed in January by HMIP, reflecting its new efficiency target.

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