From next year, only businesses operating in "higher risk" areas such as construction, or those which have experienced a recent health and safety incident or have a track record of poor performance, will be subject to inspections from the Health and Safety Executive (HSE) or local authorities.
In addition, businesses will only be held liable for civil damages in health and safety cases if anyone making a claim can show that a business acted negligently. The Government said that it will introduce legislation next month to change the current 'strict liability' regime under which businesses can automatically be liable for damages even where they were not at fault.
The announcement came as the Government said that at least 3,000 of the existing 6,500 substantive regulations it had examined as part of its 'Red Tape Challenge' would be scrapped or overhauled. The Red Tape Challenge, which began last April, is intended to identify and remove outdated and overly burdensome regulations. The Government said that it would complete its identification of the regulations which will be scrapped or amended by December 2013.
"In these tough times, businesses need to focus all their energies on creating jobs and growth, not being tied up in unnecessary red tape," Business Secretary Vince Cable said. "I've listened to those concerns and we're determined to put common sense back into areas like health and safety, which will reduce costs and fear of burdensome inspections."
Under the current system, low-risk businesses including office-based businesses, shops, hotels, restaurants and leisure premises face "proactive" health and safety inspection from the local authority or HSE inspectors.
The Government intends to replace this system with a binding statutory code, to be consulted on later this month, ruling out proactive inspections of these businesses except where there has been a "genuine employee complaint or real incident flagged to HSE". Inspections will still be carried out proactively on businesses in high risk areas such as mining, construction, explosives, gas fitting and agricultural activities.
The Government has already announced a series of regulatory changes for businesses as a result of the Red Tape Challenge. Its employment tribunal reform programme, for example, is expected to deliver £40 million in savings per year to employers, it has claimed; while the qualifying period a worker must be employed for before becoming entitled to bring an unfair dismissal claim has increased from one to two years. It will also scrap regulations dictating the location and design of 'No Smoking' signs from next month, and will overturn certain regulatory burdens in the Equality Act.
A 'one in, one out' principle, which the Government had claimed is the first of its kind, has also been introduced with the intention that the cost imposed on businesses by any new domestic regulations is matched by an equivalent saving. Regulatory burdens on businesses have been reduced by over £850 million since 2011, according to the Government's latest Statement of New Regulation.
The changes to health and safety law were proposed in November last year by Professor Ragnar Löfstedt of King's College, London, in a wide-ranging report (110-page / 781KB PDF) on the existing law. In his report, Löfstedt said that the current regime went "beyond EU requirements" in certain areas, such as by including self-employed people within the ambit of the law.
The Government has already announced that it will free up around one million self-employed people whose work poses no harm to others from the burdens of the regime, and that it will scrap or improve around 85% of health and safety regulations.
Löfstedt also recommended removing the 'strict liability principle' from the Health and Safety at Work Act, which imposes civil liability for breaches of statutory duty in relation to health and safety regulations. The Government said that this principle would be removed for civil claims, "subject to the will of Parliament", by the end of the current Parliamentary session.
Industry figures welcomed the announcements, but called on the Government to ensure that they were "the beginning, not the end" of the deregulation story.
"Excessive regulation costs time and money, both of which businesses would rather spend on developing new products, hiring staff and building up British businesses both here and abroad," Alexander Ehmann at the Institute of Directors (IoD) said. "Removing the headache of health and safety inspections for low-risk businesses is a step change. Scrapping unnecessary and unpredictable inspections is a valuable piece of deregulation and the Government are to be congratulated for taking such bold and decisive action on behalf of Britain's businesses."