Examination of Witnesses (Questions 320-339)|
21 OCTOBER 2003
Q320 Chairman: Gentlemen, good afternoon.
Thank you for coming. Our time is fairly short so perhaps you
could introduce yourselves and then we can start?
Mr Miller: I am head of risk management
for the service delivery business within the United Utilities
Mr West: I am an electrical engineer
and policy manager for Western Power Distribution which is the
licensed electricity distribution company serving South West England
and South Wales.
Mr Turner: I am head of network
continuity and emergency planning for BT.
Q321 Chairman: Several utility companies
have suggested that the definition of "emergency" in
the draft Bill is too wide and would include normal weather-related
events that utilities already deal with as a matter of course.
Can you explain why this might be a problem for your organisations?
Can you give some examples of the types of emergency that you
think would be most appropriately be covered by the Bill?
Mr Miller: If I can kick off by
attempting to frame the normal environment. Our emergencies span
events, of which we have about 6,000 per year in the north west
of England, through to crises, of which we have never had one
since we were formed or, prior to that, the water authorities
were formed in 1974. We typically have one or two major incidents
a year, and although individual members of the public in significant
numbers can be affected, we deal with them as a matter of course.
Quite often those incidents will flair up and be dealt with before
any external engagement or involvement would be either useful
or timely. We do involve what could be classed as category 1 or
category 2 responders as appropriate under existing arrangements,
and that works very satisfactorily for all parties.
Mr West: I regret this is the
least brief of my answers but I hope you will bear with me. We
believe the difficulty is twofold and interlinked with a perceived
ambiguity of the interpretation of the duties. It introduces a
parallel and potentially conflicting set of requirements to those
already governing electricity distribution network operators,
hindering consistency via the possibility of fragmented debates.
It significantly exacerbates the potential problems on ambiguity
of roles and duties of local authorities. As drafted, clauses
2(1)(a) to (e) place duties on category 1 responders to "assess
the risk", "maintain plans", etc, and in (d) to
plan to "prevent the emergency", reduce, control or
mitigate its effects or take other action. Paragraph 25 of the
accompanying explanatory notes states that, in order to perform
their duties under the Bill, category 1 responders may need to
obtain information from category 2 responders, for example about
electricity companies planning arrangements for restoring loss
of supply. Thus there may be a perception that local authorities,
for example, may have a role or duty to become heavily engaged
in the emergency planning measures of the utilities extending
to normal weather-related events. Electricity distribution network
operators are already subject to extensive statutory and licensed
requirements which deal with contingency planning, network resilience
and response to failures of electricity supplies. These are common
nationally set requirements, on which the DNOs 
are regulated, and are required to adhere to. Failure to meet
reliability standards face severe regulatory financial penalties
of up to 2% of companies' income. In light of this, and given
that a clear goal of the draft Bill is to achieve consistency,
the inclusion of "normal weather related" events within
the scope expands the potential ambiguity of the respective duties
between category 1 and 2 responders, and may frustrate achievement
of consistency rather than deliver it. There would, of course,
be no difficulty in sharing with category 1 responders how those
nationally set statutory and licence requirements were being met
by the DNO.
Mr Turner: For BT, the first thing
is the definition includes "electronic or other system of
communications". Firstly, we believe disruption of BT's network
on its own rather than as a by-product of a wider serious incident
which involves several category 1 and 2 responders is something
that we have the expertise and the process to deal with as BT,
regardless of the causes of disruption, be they weather or otherwise.
Government responders are unlikely to have the required knowledge,
skills or expertise to direct the details of a telecommunications
recovery, and we believe that the definition of "emergency"
in Part 2 should be amended accordingly. On the definition of
an emergency, or an example of an emergency, we believe it should
be those that involve several category 1 responders that require
high level co-ordination where the consequences are either life-impacting
or economic. If I give an example, looking at the telecoms industry,
if we have an exchange failure for technical reasons it could,
and does, impact on several thousand customers not having a telecommunication
service which we restore under normal processes. However, if that
failure was coupled with a wider incident which involved the same
number of customers but also impacted on the utilities and on
geography, that would be quite a high level of co-ordination.
However, that we would see as an example of an emergency.
Q322 Lord Condon:
Gentlemen, building on your answers to the Chairman and that you
have just given, is there any advice or observation you would
give us about the threshold that you think should be set for the
types of emergencies that would (a) trigger the requirement for
statutory plans and (b) trigger the actual use of emergency powers?
I know it is difficult to set generic thresholds, but is there
anything around thresholds that would trigger these two issues?
Mr Miller: It is important that
that dialogue occurs within sectors and is applied consistently,
and that that awareness is shared with the proposed category 1
responders. Our experience is that the level of significant emergencies
for a utility probably has a higher threshold than is perceived
by many members of the community. It is only really when we share
that threshold and that is backed by, perhaps, regulatory endorsement
at a national level that there is some credibility to that threshold.
Mr West: I share the comments
of my colleague here. In terms of the definition of "emergency"
we would support the view expressed by the Association of Chief
Police Officers in their written submission in August that the
definition contained in the Home Office Dealing With Disaster
document is an appropriate one for a threshold. As far as Western
Power is concerned, we might consider a threshold as being more
than X thousand customers being off supply for perhaps seven days.
Mr Turner: Again, this is a difficult
one on a definite threshold. We believe really, rather than specific
scenarios, there should be a flexible approach and also the statutory
duty should plan for resilience to a challenge rather than trying
to establish what a defined trigger is. Certainly, in talking
to the general resilience and emergency community, it might seem
a trite statement but you will know one when you see one, and
when you try to tie it down to words you end up with so many branches
feeding off it, so really we see it as part of a continuum which
goes from gas, fire and floods, for instance, to major incidents
further up, and it depends on who is involved in the level of
co-ordination. Like my previous example, you would have an exchange
failure which is not an emergency but the consequence of that
combined with other activities and incidents which are going on
would constitute an emergency.
Q323 Lord Brooke of Alverthorpe:
How do you respond to the view that utility companies should be
placed in category 1 because of the potential they have themselves
to cause emergencies and to aid response and recovery? I think
probably Mr Turner's first response to the Chairman was making
the case for you to be included as a category 1 respondent.
Mr Turner: Firstly, BT accepts
the definition in the lists as they stand and agrees that BT should
be a category 2. BT if you like carries phone calls and connectivity
so it is different to my colleagues who deal with water and gas.
If you cut a telecom cable you do not get the road congested with
telephone calls; it is connectivity you lose, so you will not
get a major flood or anything caused by the cutting of a telecoms
cable. Again, if a telephone exchange loses service, we have processes
with the blue lights and the police, etc, and our own processes
to restore service within that, so I cannot see if we were classed
as a category 1 responder for that how additional involvement
for the other category 1s, etc, outside BT would help.
Mr Miller: Expanding on that point,
I cannot speak for the water sector but United Utilities sees
little advantage in being a category 1 responder. In both the
water and the electricity sectors, the regulatory environments
require us to have the contingency plans and do the risk assessments
already that the requirements under the draft Bill and the emphasis
on category 1 responders' duties would bring. So a lot of that
proposed category 1 accountability exists already within those
two sectors. If there is something of sufficient scale where we
as a category 2 responder would step up and inform category 1
responders. That would occur anyway, and it occurs now in the
normal working relationships between the parties.
Mr West: On the electricity side,
because distribution companies already have legal duties on them
in respect of resilience and contingency planning flowing essentially
from section 96 of the Electricity Act 1998 as amended by the
Utilities Act 2000, to place them on a list of category 1 responders
would create some ambiguity of parallel and competing legislation.
Q324 Lord Brooke of Alverthorpe:
Coming back to Mr Turner, I rather got the impression that BT
felt they had greater knowledge in certain areas than the lead
departments might have if they were concerned with an emergency.
Can I press you on that again? For example, what would happen
if the City went down and there was total financial collapse in
the City? You would be right at the heart of it.
Mr Turner: We would be at the
heart along with all the other telecoms providers in the City,
because there is more than BT in the City of London. The way it
works at the minute, we would co-operate with other telecoms and
service providers in the industry and we would work together on
the restorationBT has restoration plans for its own aspect
of thatand then it would come really into the supply chain.
If the City went down, if it was because BT lost service, we have
our own contingency plans; if BT lost service and the City firms,
for instance, could not get into their offices, you are then looking
at BT backing up the contingency plans and fallback plans for
those institutions that are served in the City. So there are two
aspects: one is where BT loses service on its own and the second
one is where BT loses service as a result of a wider or catastrophic
incident; and then there is the other aspect where BT is required
to respond which is providing communication services to the category
Q325 Lord Brooke of Alverthorpe:
Who would you see in the instance I have just given you as being
the lead department?
Mr Turner: That is a question
at the moment which is resting with the civil contingencies community.
At the moment BT have stepped into the breach. We do not have
any implied authority to do that but BT are co-ordinating the
industry within an Oftel Committee.
Lord Brooke of Alverthorpe: It sounds a bit
like lead 1 responder to me, but anyway.
Q326 Kali Mountford:
I take Doug Turner's point that your businesses produce different
services and products between you but what you do have in common
is businesses over a large geographical area. There is some concern
about utility companies' ability to respond to every local authority
emergency planning team, but it is important, I think, if category
2 responders are properly involved in the process. Have you got
any solutions you would like to suggest to that particular problem?
Are you thinking of perhaps feeding in at a regional level, or
do you think a flexible model would be useful where you attend
a proportion of meetings, say a quarter of them, or any other
model you would like to propose?
Mr Turner: Currently BT supports
the local blue lights and the local authorities in their contingency
and emergency planning as it stands at the moment. Our recent
experience comes from actively supporting the London resilience
team, which brings a greater level of commitment because you are
really going right down from the detail of the response to an
emergency to the level of looking at the routing of circuits and
the resilience to category 1 responders. If you then want to replicate
that across the rest of the country, we would struggleit
is not just people on the ground but people with the relevant
skills. At the moment it is me that supports the London resilience
forum, and if I were to support another nine regional committees
all wanting to start at the same time there would be an issue
not just of who would do it but what is the skillset if you were
to put that under BT alone. However, it is something which is
on the telecoms industry, which I believe it should be, and exists
under the licence as it is at the moment, and would spread the
burden. On the question of regional assemblies, if we were called
in at a regional level and that replaced the need to liaise at
a local level, that would help, but the question would then be
whether you would be able to go into the detail required for local
authorities working at that level. The other aspect, if you look
at national co-ordination, looking at the Bill, is how many regional
incidents do you need before they become a national incident,
and where is the national co-ordination going to come from? What
happens if you have an incident which crosses boundaries? It is
not going to stay in the definition of a regional boundary or
a local authority boundary. What happens if half of it is in Scotland
or in England? What happens if we have an incident in London which
hits part of the telecoms infrastructure, bearing in mind the
telecoms infrastructure serves the whole of the United Kingdom?
It does not mean to say, because you have a switching capability
in London, that it serves London; there are international switching
gates based in London which are part of the United Kingdom infrastructure,
so when you look at telecommunications it is a national capability,
and BT does work and we co-operate and have done for a long time
with local authorities, assisting with their planning, but we
do need to work out what it is going to mean in the availability
of skills and resources should you want to expand that and introduce
Q327 Kali Mountford:
No suggestions then?
Mr Turner: We need to work through
the specifics, actually.
Mr Miller: Speaking on behalf
of a business that covers Crewe to Carlisle in terms of area and
about seven million population, we interface with six county level
forums. The 4.5 staff who are dedicated to that interaction would
struggle to interact at a local authority level, and it is not
necessarily an advantage to interact at that level because many
of the problems we might present to them for their resolution,
or contribution to the resolution, can be addressed at a generic
level. So whether it is 23 Acacia Avenue or 45 Smith Street, 200
miles apart, in essence the problem is the same and the response
is the same. The category 1 responders need to understand the
way in which we might present a problem to them and the implications
in terms of time scale, impact and likelihood, that is the important
exchange that needs to take place. We would certainly welcome
a regional forum because having that regional footprint, as you
say, particularly with our aqueduct network which stretches across
that region, we have the scope to affect fairly quickly from a
problem in Cumbria the citizens of Manchester, for instance. So
we would be far more comfortable with having that interaction
at a regional level than we are, with solely county level liaison.
Mr West: I would agree with Mr
Miller. In respect of our area we would interface with 45 local
authorities and, again, there would be the difficulties of consistency.
We believe that there would be difficulty in explaining to 45
different authorities that we are working to sets of nationally
set guidelines imposed by the DTI and Ofgem.
Q328 Lord Lucas of Crudwell and Dingwall:
Suppose a local authority wants to know what the consequences
for the powered network are of a particular incidentsay
Hounslow wants to know what happens to its telephone line facilities
if a plane crashes and under what circumstances would they have
problemsthey would have to go to their regional office
to answer that question?
Mr West: In respect of electricity
we already interface with the county councils quite happily and
successfully, and we would hope that they could take on the role
of co-ordinating the interface with the local authorities below
them. If the contingency planning arrangements already existing
and required of the electricity companies were somehow perceived
to be inadequate in terms of the format, I would see that as being
something best addressed by the DTI and the regulator who would
have wider knowledge of the environment in terms of the design
requirements, the network, the investment criteria, and the national
discussion on what was an appropriate level of resilience.
Q329 Lord Lucas of Crudwell and Dingwall:
And you would never find a problem with the nationally set criteria
meeting what was going to be required by the new systems emerging
at local level? You could get a complete difference between what
you are being required to do nationally if you were never having
to test that against the requirements of responding in terms of
the local plans? I am sure you would need a good interface there
to know whether national requirements being placed on you are
appropriate any more?
Mr West: Absolutely, and there
is nothing I would wish to suggest which would indicate that we
would not wish to share with the local authorities, through county
council level ideally, what those arrangements were, and if they
were sought to be inadequate to escalate those back up through
(Ofgem and DTI) for a nationally consistent set of arrangements.
Mr Miller: I would not want to
give the impression that in any way we are reluctant to answer
particular inquiries from local authorities. Virtually all the
local authorities are represented at county level and we do have
regular exchanges with them, but the implication of having more
detailed and more extensive exchanges, as is perhaps implied in
the proposals, would require additional resources on our part
to manage, but that testing and challenge of the preparedness
does go on at county council level.
Q330 Mr Allan: Clause
2 of the draft Bill has a requirement that category 2 respondersor
category 1 and category 2 but category 2 responders such as yourselvesmay
be required to provide information to the category 1 responders,
and concerns have been expressed about the potential data protection
implications of this and the commercial sensitivity of you handing
data overto local authorities, I guess in particular. How
significant a problem is that in your estimation, and do you think
the Bill requires amending or further definition in order to make
you feel comfortable about those implications.
Mr West: For Western Power we
have no particular concerns in terms of data protection. Information
reasonably requested by category 1 responders, is subject to confidentiality
agreements should the need arise in a regulation, made under clause
2(2). A theoretical area of concern is the situation where information
provided has not been subject to regulation under clause 2(2)
but which category 1 and 2 responders cannot agree should be published.
That scenario might be covered by adding a reference to section
2(1), into clause 3(1), the "Minister may issue guidance"
clause, so that if it became an issue there was a mechanism to
deal with it.
Mr Turner: BT does not have a
specific issue about, and recognises the importance of, sharing
information in an emergency. What we would like, though, is some
provision for restricting the use of it. We recommend that the
Bill be amended to ensure the confidentiality of it is respected,
and to prevent it being used in an anti competitive way or any
other way to secure a commercial advantage possibly with appropriate
penalties for infringement. So it is not providing the information;
it is how it is then secured once it is provided and used.
Mr Miller: I would echo my colleagues'
comments but there are two other areas: certainly a number of
our assets are of such strategic importance that the security
angle concerns us, but I am assuming that is taken as read. The
other is of a more practical nature in terms of the willingness
on both parties to share information, particularly about vulnerable
customers, whatever implication that designation has, where the
Data Protection Act at the moment makes one or both parties reluctant
to exchange that information but where there is probably a benefit
for both parties and the person whose data is being proposed for
exchange, but the parties are reluctant to test the Data Protection
Act in respect of that information provision.
Q331 Mr Allan: So
some specific guidance in that area where it is personal data,
and I guess we would be looking to summon up the Information Commissioner
to offer that, would be of assistance?
Mr Miller: It would.
Q332 David Wright:
Do you think central and regional tiers of government should be
included as category 1 or 2 responders? Are there any other organisations
that you think should be included in category 1 or 2? If so, why?
Mr West: From our point of view
they should only be included if they have a specific and defined
role to play. We would seek clarity in roles.
Mr Turner: From our perspective,
we would give a guarded "yes". We think that this should
be included but, again, that the role be defined because otherwise
we cannot see how you would end up with any national co-ordination
if an incident then became more than a regional incident.
Mr Miller: We would certainly
support regional government being involved as potentially a category
1 responder to provide that focus and co-ordination for regional
response. It was our experience in both the fuel crisis and the
foot and mouth outbreak, about 50 per cent of which occurred in
our region, that we would have benefited from that in the early
stages of the outbreak. In terms of central government's role,
I might suggest that there is maybe more value there in promoting
a rational debate on national risk appetite, because it is difficult
for industries or sectors to determine what their priorities and
what their thresholds are for risk exposure without a clear understanding
of what the public perception of risk acceptance is. We have seen
examples, for instance, in investment in rail safety where if
you transfer the debate on to investment in the NHS or junction
improvements on highways different people have different attitudes
to the value of that investment. So the sectors can make judgments
but without the national debate we are making it in isolation.
Q333 Lord Brooke of Alverthorpe:
Who would you define as regional government? Are you talking about
the government office in the regions as being the appropriate
body, or is it some separate body that you have in mind?
Mr Miller: No. That is who I have
in mind. We are beginning to see the development of that dialogue
now with that office within the north west, and the engagement
of external agencies like the North West Development Agency, for
instance, so there is a constructive dialogue developing.
Q334 Lord Brooke of Alverthorpe:
Would you see them as responder 1 or 2?
Mr Miller: I would see them as
Q335 Mr Bailey: In
the submission from United Utilities it points out that the only
gas utility identified is Transco and you point out that there
are other organisations, including yourselves, that hold a licence
for the operation of gas distribution networks. Which other organisations
would you like to see included?
Mr Miller: We hold an independent
gas transporters licence, admittedly a modest one for only about
3,000 customers. The largest of the other organisations that we
have an awareness of has about 100,000 customers. They tend to
be in discrete areas, so a new housing estate or a new industrial
development can be served by a separate gas utility other than
the one that had the previous monopoly in that area. To some extent
that represents a challenge for the draft Bill because as competition
embeds nationally the number and the fragmented nature of the
customer base of those organisations will grow. It is possible
to construct a form of words, I will offer some to the Committee,
as to how you might attempt to deal with that in the draft Bill,
but I will not weary you with it now.
Mr Bailey: That was my next question, but if
you are going to submit it that will be sufficient.
Q336 Chairman: We
will need a reply fairly quickly, of course.
Mr Miller: Fine.
Q337 Lord Bradshaw:
You have mentioned that the major body with whom you liaise is
the county councils, that was certainly said by somebody. What
added value is there in building up either a regional or a national
forum to deal with emergencies, or does the present system largely
work and can it be made to work without additional aid?
Mr Miller: Perhaps I can offer
a parallel experience of Y2K. I led the business continuity planning
approach for our business at Y2K. There was a body formed there
called the UKY2K utilities group which contained virtually all
the big players at national level among the utility companies.
It was amazing to see the lack of awareness there of the different
approaches, boundaries and risk appetites that existed. At the
end of that organisation's life of two or two and half years there
was a far greater shared understanding and informal network in
place and a greater ability to develop standards and common approaches
than existed at the start. If a national forum on emergency planning
backed by some debate on risk appetite and preparedness to accept
risk across the different sectors existed then I think there would
be a distinct benefit for UK plc.
Q338 Lord Bradshaw:
But you are saying that that research is basically in training
mode, risk appetite research, you are not actually doing anything,
Mr Miller: The sectors already
have quite extensive mutual aid arrangements. That has tended
to develop on a silo basis and so there is not that much of an
exchange of awareness or resources, but that is the kind of forum
that those questions and that debate could be held in.
Q339 Lord Bradshaw:
But if an emergency happened in Manchester or Cumbria tonight
the arrangements would work, would they?
Mr Miller: Yes.
2 Distribution Network Operators. Back