What are the digital and transparency implications of the FSA regulating the future agenda. I look at several in this months food issue of the CIEH environmental health news.

1. Practice
18 •Environmental Health News • December 2018/January 2019
business,
There are
many as yet
unanswered
questions
that the
FSA must
address and,
crucially,
get right
At one stage, it was suggested that specially
qualified and regulated ‘certified regulatory
auditors’ could bridge the divide, fulfilling
statutory monitoring requirements and
providing private assurance standards. The
FSA has rowed back on this proposal for very
good reasons, in my opinion. Nevertheless, it is
clear businesses will have to bear the costs of
statutory inspection one way or another.
To my mind, one of the striking features of
the current regulatory regime is that it is based
on evidencing risk using models created more
than 30 years ago. Salmonella was the primary
risks in eggs and chicken meat then, but new
pathogens of concern have since emerged,
such as campylobacter, that have quite
different implications for control measures.
The trend towards de-skilling the workforce
in favour of lower-cost, casual labour brings
obvious risk. The corollary — taking production
off-site to centralised locations — means that
food may be little more than ‘assembled’
in accordance with brand standards and
pictures. Rice, salads, sauces, dressings and
other high-risk ingredients are prepared and
manufactured off-site, moving the safety risks
back up the chain; if production safety fails, it
affects a far greater number of retail sites, but
few caterers have the technical resource to
independently inspect those suppliers.
Technology is changing the game and
presenting its own risks, too. Complicated
I
n September’s EHN, Michael
Jackson, who is leading on
Regulating Our Future (ROF), gave
us a comprehensive update on the
Food Standards Agency (FSA)’s
progress (EHN, September, page 18).
The plans are bold and recognise
the current system of regulation
is not sustainable as a financial model or fit
for purpose in a changing world. The FSA is
rightly proceeding with caution and adapting
its plans as it consults with industry and other
stakeholders, while staying on course for
implementation next year post-Brexit.
The bedrock of the plan are: a national
register of premises; a new ‘risk engine’
to assesses businesses and determine the
frequency and depth of inspection regimes; an
ambitious extension of the primary authority
(PA) scheme, in which one local authority
sets standards for a whole company’s sites,
wherever they are located and national
inspection strategies, combined with a use of
private assurance data in a way as yet decided
to help determine the nature, intensity and
frequency of local authority inspections.
In other words, businesses might be able
to reduce the number of local authority
inspections they undergo by sharing the results
of certificated assurance inspections, such as
those of the British Retail Consortium, second-
parties and even themselves.
Technology and risks are changing, food
production is de-skilling and sensitive
information can easily end up all over the
media. David Edwards asks some searching
questions about the future of food safety
machinery, such as coffee and pizza-making
machines with robotic functions, offer new
challenges in terms of hygiene and safe
operation, while innovative ingredient and
product formulations require new approaches
to assess their risks.
So, how can the FSA best design a
meaningful profile of a business’ risk? It’s
not clear how risk assessments of registered
premises will operate, at least in the first
instance, but it is likely they will be fairly basic
and based on the nature of the food produced
and any private assurances already in place.
This is a good place to start, given the huge
opportunities that now exist for detailed and
predictive analysis of safety records. However,
regulatory inspection records are fairly crude
compared to the wealth of granular data in
the private sector collected over many years
through various inspection schemes.
Big businesses are already exploring the
potential of big data and artificial intelligence
to provide predictive insights about their
own standards and risk. This is a clear area of
opportunity for partnership-working in a safe
and controlled way: sharing and exploring
anonymised industry data to inform policy.
Big
big data

2. Environmental Health News • December 2018/January 2019 • 19
of very confident, trusted large companies.
Under the proposed plan, participants
would not only have to demonstrate an
excellent record of compliance but also share
their private assurance data. That level of
transparency and trust goes well beyond
current practice. It is also unclear if companies
would be able to give broad, overarching,
statistical information or would have to make
available sensitive inspection reports, customer
complaints and internal management reports.
An important part of the role of a
professional private inspection body is to
tell its clients inconvenient truths. Would
that still happen under such a transparent
arrangement? Would punches be pulled and
the real discussion go ‘offline’?
FOI is again an issue here. With data in
the hands of the PAs, companies would be
open to requests from the public, journalists
and competitors to access to it. This is not
a comfortable position in which to be. The
FSA points out the distinction between the
regulators ‘holding’ and ‘accessing’ data, but
this needs public clarification because of the
potential impact of FOI.
I am unconvinced of the argument that a key
driver for the success of national inspection
strategies will be the financial benefits of
reduced inspection. Many large, multi-site
groups welcome local authority inspections
as a cost-effective way of validating their
own standards.
ROF proposes that all businesses will pay the
real costs of their inspection regime. Businesses
are already facing the considerable challenges
of funding the national living wage, elevated
high street rents and competition from smaller,
more nimble operators. Can they really absorb
another cost or will they be forced to pass it on
to the consumer?
Inspection charges need to reflect the real
costs of resourcing the programme, if the
taxpayer is not to be penalised. However, if
the charges are set too high, there’s the risk
of a parallel privatised inspection system
developing. Some local authorities are already
setting up arms-length operations that will
compete successfully with the private sector
inspection bodies on price.
So, in conclusion, there are many as yet
unanswered questions that the FSA must
address and, crucially, get right. What are
the right components and emphasis for an
effective risk assessment algorithm that is
consistent, workable and evidence-based?
How will the FSA create genuine incentives
and protections concerning information
sharing, when companies will rightly worry
that information shared becomes disclosable
under FOI? Are national inspection strategies
really going to take off as a consequence of
introducing regulatory inspection charging?
What is a sustainable funding model?
I for one will be closely following the
developments. E
IMAGE:ISTOCK
‘The plans are bold and recognise the current
system of regulation is not sustainable as a financial
model or fit for purpose in a changing world’
public, too, would certainly object to anything
that smacked of self-regulation.
On the other hand, private inspection
bodies saw little incentive in it for themselves.
Instead, they saw it could potentially raise their
costs while fatally damaging their confidential
relationship with paying customers. Businesses
were also wary of having their privately
captured audit data obtained through
Freedom of Information Act (FOI) requests and
published on social media and in the local and
national press.
The devil is, as always, in the detail.
Safeguards could, of course, be put in place
to protect commercial confidentiality, but
it seems to me that only a few very large
companies, which have already committed to
making their inspection records public, are
likely to be comfortable sharing them with
the regulator.
PA has been a resounding success and is
well liked by industry and regulators alike.
Enhanced PA arrangements could have a
significant impact on companies with multiple
sites and branded chains, and there are
ambitious targets to have 250,000 businesses
in a PA scheme by 2020.
H
owever, ROF contains a
clear change to one of
the key components of
PA — the FSA will now
have to approve national
inspection strategies.
This appears to be an
attempt to ‘calibrate’
arrangements and introduce some national
consistency, possibly in reaction to criticism
that PA arrangements can lead to ‘regulatory
capture’ — in other words, businesses and local
authorities may get too close, either because
the financial arrangements are too generous
or simply the human factor in a partnership
means it is harder to remain objective.
The proposal certainly has merit, but it
needs careful thought and much trust if it is to
work effectively for more than a small number
It also provides a potential avenue towards
lowering the burden of statutory inspection
while avoiding the vexed issue of commercial
confidentiality and the competitive sensitivities
that rear their heads every time public-private
data sharing is mentioned.
One of the key tenets of ROF is to exploit
the evidence of private assurance to inform
statutory inspection regimes. In theory, this
is an eminently common sense proposal. In
reality, many companies shy away from it, even
as a way to lower the overall costs of inspection.
There are two clear issues. On the one hand,
regulators cannot, by law, hand over their
responsibilities for public safety to private
bodies. Recognising this, the FSA has moved
from a starting position of ‘regulated self-
assurance’ to ‘regulated private assurance’.
This is not mere semantics — it is an
important distinction. Regulators and EHPs saw
the FSA’s certified regulatory auditor concept,
in which licensed inspectors working in the
private sector would also conduct statutory
work, as the ‘thin end of the wedge’ and it hit
opposition from all sides. They said it would
represent ‘privatising’ inspection (denied,
truthfully I think, by the FSA). The sceptical
▼ David Edwards
David Edwards MCIEH was co-founder in 1985 of
the food safety consultancy CMi plc, which was
sold in 2007 to NSF International. He has provided
advice to many leading companies. He
is a member of the government’s Better
Regulation panel and is a non-executive
director of four companies operating in the
fields of food technology and regulatory
software. David was awarded the
CIEH Lifetime Achievement Award in
2017. In his spare time, he is an active
supporter of Shelter, a local foodbank,
and the Samaritans.