Environmental Standards and Public Values

7/29/2019 Environmental Standards and Public Values

1/91

Environmental

StandardsandPublicValuesSummary

A Summary of the Twenty-first Report of the

Royal Commission on Environmental Pollution

Environmental Standardsand Public Values

The Royal Commission on Environmental Pollution is an independent

body, appointed by the Queen and funded by the government, which

publishes in-depth reports on what it identifies as the crucial

environmental issues facing the UK and the world.

The Royal Commissions full report(Setting Environmental Standards)

is available from The Stationery Office (Cm 4053; ISBN 0 10 140532-4).

The summary report is available on the Royal Commissions website

(http://www.rcep.org.uk).

The Royal Commission on Environmental Pollution

5-8 The Sanctuary

Westminster

LondonSW1P 3JS

Email: [email protected].

Tel: 0207 799 8970


2/91

Environmental Standardsand Public Values

A Summary of the Twenty-first Report

of the Royal Commissionon Environmental Pollution


3/91


4/91

Contents

Foreword 6

About this version of theStandards Report 9

Why are environmental standards important? 10

Background to this study 10

Changing nature of environmentsl policies 11

The role of standards in environmental policies 12

Significant changes in the policy process 13

Box A Forms of Environmental Standard 14

Figure 1 relationships of forms of standard for

one substance (lead) 16

Scientific understanding 17

Introduction 17 Assessing toxicity and the effects on human health

and the environment 18

Environmental pathways and assimilative capacity 19

Output from scientific assessment 21

Box B Sources of error in assessing pathways and

exposures 22

Technological options 26Environmental standards based on technology 26

Taking into account the whole life cycle of products

and processes 27

Box C Life cycle assessment 28

Output from assessment of technological options 29

ENVIRONMENTAL STANDARDS AND PUBLIC VALUES 3


5/91

Risk and uncertainty 30

Risk assessments, statistical probabilities and their

limitations 30

Public acceptance of risks 32

The precautionary principle 32

Box D International expressions of tghe precautionary

principle 34

Assessment of risk and uncertainty and itsapplication to environmental standards 33

Economic appraisal 39

Economic appraisal and environmental standards 39

Best practice in economic appraisal 40

Box E Putting a monetary value on environmental

damage 40Valuing environmental policy options for which there

is no market price 42

Practical application of economic appraisal 42

Output for economic appraisal 43

Implementing environmental policies 45

Introduction 45

Geographical scope of standards 46 Direct regulation 46

Economic instruments 48

Self-regulation 49

Output from implementation analysis 50

Articulating values 52

Introduction 52

Established methods for seeking public views 53

4 ENVIRONMENTAL STANDARDS AND PUBLIC VALUES


6/91

More effective procedures for articulating values 54Scope for using new methods to articulat values 56

Box F Methods for articulating values 58

A robust basis for environmental standards 60

Figure 2 Environmental policy process 61

To conclude: the new challenges 66

Appendix A 69Members of the Royal Commission at the time of the

Standards Study 19951998 69

Appendix B 74

The Royal Commission seeks views on basis for

environmental standards 74

Appendix C 78Development in the field of public participation since

the Royal Commissions report 78

Note by the Institute for European Policy

Appendix D 81

Membership of the Commission (November 2004) 81

Reference and notes 87



7/91

ForewordIn September 1995 the Royal Commission, then under theChairmanship of Sir John Houghton, announced a study of theway standards for environmental protection were set, the termstandards being used in the widest sense. A report on thestudy, Setting Environmental Standards, was published inOctober 1998.1 It called for a new approach to decidingenvironmental policies. The key feature of this new approach

was that, as well as drawing on rigorous and dispassionateanalysis, there must be a greater sensitivity to peoples values.

At the launch of the report, Sir Tom Blundell (who becameChairman in July 1998) said that for environmental policies to besuccessful, people must have confidence in the way they werebeing protected against risks. That was best achieved if theywere involved at every stage. The controversies which have

occurred over the past ten years, and which continue to rage (forinstance over GM crop trials), have reinforced the Commissionsmessage that governments, industry, the public and scientistsneed to have a better understanding of the relationship betweenpolicies, science and values.

Sir John Houghton added: There must be a more robust basisfor setting environmental standards. This must recognise thatscientific assessments, and analyses of technology, economics

and risk, must inform policy decisions, but cannot pre-emptthem. Setting a standard or target is not only a scientific ortechnical matter, but a practical judgement which has to bemade in the light of all the relevant factors. Peoples values mustbe taken into account from the earliest stages of defining theproblem and framing the questions that need to be addressed.

The Commissions press release concluded with the hope that thereport would make a significant contribution to developing thisnew style of policy, which it sees as appropriate in facing the



8/91

environmental challenges of the new millennium. Those werebrave words, and might appear somewhat optimistic in thelight of the Governments broad-brush response to the report.2

But the Royal Commission has learnt, over its remarkably longlifetime of nearly 35 years, that seeds take time to germinate andthat a box-ticking comparison of its recommendations with thepost-publication government response tells us only a small partof the story.3

Lord Flowers, the Commissions second Chairman, believedthat much of its influence was through doing good by stealth.The Commission has built up an impressive institutionalmemory, which is why it is appropriate, when referring to pastCommission activities, to go on saying we when eight yearson there has been a virtually complete turnover of membership.

The Commission is prepared to wait in one extreme case

(integrated pollution control) it waited for seven years beforeit received a positive response from the government of the dayand another seven years for the implementing legislation. In thisinstance we shall look for opportunities to remind policy-makersof our published proposals and ideas and their relevance to thepresent day. We have done this in the three reports which haveemerged since the Standardsreport4 and will continue to doso in our current studies. At a convenient future date the

Commission will, in accordance with what is now standardpractice, conduct a full retrospective review of the report andits impact.

With those last three reports it has also become standard practicefor the Commission to produce a free-standing summary bookletalongside the main report itself. In this way we hope to makeour thinking more accessible to the wider public. We havedecided it is not too late and indeed would be timely to

do the same for Setting Environmental Standards. We do sofor several reasons:



9/91

Although the 21st Report may lack the catchy phraseswhich have become RCEP classics such as best practicableenvironmental option (BPEO) or duty of care its aims areentirely at one with those of the earlier reports which havedealt with environmental policy-making in a holistic (or, asBrussels policy-makers would put it, horizontal) manner.We believe readers of the Commissions subsequent reportswill find it convenient to have the conclusions of the Standards

report by them in a readily digestible form, for so long as theyremain valid.

The Governments response of four years ago contained asnapshot of what was being done or contemplated, eitheras direct responses to the Commissions suggestions or asinitiatives which were demonstrably consistent with theCommissions advice. We were happy to acknowledge thatsome positive progress was being made at the time.

With the emphasis given by the report to public participationand transparency in standard-setting, and in the light of recentexperience in applying models advocated in the report (suchas the UK Chemicals Stakeholder Forum), it is particularlyimportant to give the Commissions views wider currency.

The report made it clear (at the head of its Conclusionschapter) that the Commission was not primarily in the business

of making detailed recommendations:Our aim has been to indicate the broad directions in which we

believe protection of the environment should evolve, not to make

specific recommendations. There are nevertheless a number of

matters on which we have reached conclusions.

The Commissions task over the coming years will be todemonstrate how those conclusions can be put into practicaleffect and to assist with the evolutionary process. If this rsum

of the report helps to facilitate that task it will have servedits purpose.



10/91

About this version of the Standards Report

A report as wide-ranging as Setting Environmental Standardsdoes not lend itself easily to a brief summary. We have foundit necessary to retain a good deal of background material andanalysis in order that the reader can get a clear picture of howwe arrived at our conclusions. The result may therefore be seenmore as an abridged version of the report than as a summary.

It is about one-fifth of the length of the original.The final chapter (No. 9) of the report comprised a consolidatedlist, with cross-references, of the conclusions which hadappeared in bold type in the various preceding chapters. Forthis shorter version we have followed the order of the originalreport, and under each main heading we have reproduced (initalics) the snapshot summary which headed the correspondingchapter in the report, since we think it is useful to give the

flavour of how the issues were encapsulated at the time.

As we explained in the reports opening chapter, we have givenclose attention to the analytical stage of the policy process andthe outputs that should be expected from it. We proceeded toexamine the process under five separate but overlappingheadings science, technology, risk and uncertainty, economics,and practical implementation. As a result, much of the reportwas taken up with detailed discussion of scientific methodology,engineering solutions, economic models, etc; on this, werecommend interested readers to consult the full text. For presentpurposes this summary concentrates on the outputs i.e. thebroader principles which we believed should guide future policy.

Although this is essentially a rsum of the report as it stood inSeptember 1998, in preparing it we have taken the opportunityto note subsequent developments in the policy field and to

update references (e.g. to legislation) where these seem relevantor necessary.



11/91

Why are environmental standards important?

Environmental regulation, and environmental standards in

particular, have assumed much greater importance in the last

30 years. The nature of concerns about the environment has

changed. There have also been changes in the policy process.

Against that background, can a more consistent and robust basis

be found for setting standards for environmental protection?

Background to this study

The Royal Commissions membership during the period of thisstudy is in Appendix A (the current membership is in AppendixD). The Commission decided to do the study because thereseemed to be widespread confusion and misunderstanding aboutthe purpose and mechanisms of environmental regulation.The aim was to see whether a more consistent and robust

basis could be found for environmental standard-setting.

We approached the task by comparing the methods andprocedures adopted in arriving at the standards for controllingall types of pollution and for protecting all aspects of theenvironment. By standards we meant not only standardscontained in law (for example, emission limits or environmentalquality standards) but also non-statutory protocols, guidelinesand targets, and criteria used for deciding individual cases. Welooked at what was happening at the European level, in othermajor countries and in international organisations, as well as inthe United Kingdom.

We invited views from a wide range of organisations andindividuals (see Appendix B for the text of the invitation).Work on the study extended over nearly three years; writtensubmissions were received from nearly three hundred bodies

and individuals, of whom some fifty gave oral evidence or tookpart in discussions with the Commission and its Secretariat.



12/91

Opinion among those responding was divided. Some peoplefelt that present standards did not provide adequate protectionagainst chronic exposure to pollutants. Others suggestedthat standards were set inconsistently and that the cost andfeasibility of applying them could be out of proportion to theenvironmental benefits, arguing that unnecessary stringencycould be counter-productive. There was also disagreementover the scientific basis for many of the concerns raised about

environmental hazards.

Changing nature of environmental concerns

The nature of environmental concerns has changed significantlyin terms of the objectives of policy, the time-scales considered,the geographical scales considered, and the kinds ofenvironmental modification that are addressed.

Traditionally, environmental standards have been driven by theneed to protect human health from the obvious effects of localpollution of air and water e.g. smoke and noxious effluentfrom factory chimneys and pipes;

In the latter part of the 20th century, with the increasingsuccess (at least in the developed world) of measures tocontrol the more gross forms of pollution, the focus of concernshifted towards longer-term and less easily detectable forms,

particularly those which are associated with chronic healtheffects or irreversible modifications to the environment e.g. climate change and other problems which call for actionat a national or international level.

This progressive shift of emphasis has implications for the wayenvironmental standards are used and set. It also has implicationsfor the types of evidence, in particular the types of scientific

evidence, required to support decisions on policies and standards.



13/91

The role of standards in environmental policies

Environmental standards take diverse forms. They include notonly numerical and legally enforceable limits, but standardswhich are not mandatory but contained in guidelines, codesof practice or sets of criteria for deciding individual cases; andstandards not set by governments which carry authority for otherreasons, especially the scientific eminence or market power ofthose who set them.

Box A sets out, with examples, the terminology used in thereport for categorising the various types of environmentalstandard. The common characteristic is that a standard should be:

any judgement about the acceptability of environmentalmodifications resulting from human activities which fulfilsboth the following conditions:

it is formally stated after some consideration and intendedto apply generally to a defined class of cases;

because of its relationship to certain sanctions, rewards orvalues, it can be expected to exert an influence, direct orindirect, on activities that affect the environment.

(Report, paragraph 1.16)

The diversity of forms of standard corresponds to the many

different forms taken by measures to protect the environment.Figure 1 illustrates the complex inter-relationships of measuresand standards for a single substance, lead. Achieving a standardfor daily intake of lead, in order to limit the concentration of leadin human blood, involves setting and achieving standards forseveral aspects of environmental quality and an array of relatedemission, process, product and use standards.



14/91

Significant changes in the policy process

Standards are a crucial element in the environmental policyprocess. Numerical standards have come to occupy a centralposition in a much expanded system of environmental regulation.One reason for this has been advances in science and technology.Numerical standards are an obvious and convenient way ofcodifying scientific understanding of human impacts on theenvironment so that they can be managed and regulated.

The report noted other key changes in the policy process which hadoccurred over the last three decades of the twentieth century:

environmental policies and standards that apply in the UKwere now determined predominantly on a European scale(see Box A);

there had also been a great growth in the number and

importance of international conventions relating to theenvironment, at both global and regional scale: examples arethe United Nations Environment Programme (UNEP), theinternational conventions on Climate Change and Biodiversity,and multi-lateral environmental agreements (MEAs) interactingwith the requirements of the General Agreement on Tariffs andTrade (GATT) and the World Trade Organisation (WTO);

the 1990s in particular were marked by a growing use of

formal techniques to aid decision-making (risk analysis, lifecycle assessment, cost-benefit analysis, etc), driven by aconcern to take a broader and more comprehensive viewof the environmental impact of human activities;

the influence of environmental non-governmental organisations(NGOs) on policy development and decision-making had beengrowing steadily.



15/91

BOX A FORMS OF ENVIRONMENTAL STANDARD

Standards applying directly to a point on a pathway

biological standards defining the limits of physiologicalchanges or other impacts acceptable in an organism

example: European Community (EC) reference level forthe concentration of lead in blood

exposure standards defining acceptable exposures or dosesat the point of entry to an organism

examples: EC dose limits for external radiation; tolerabledaily intake of a substance from all routes determined underthe International Programme on Chemical Safety

quality standards defining acceptable concentrations of asubstance in air, water or soil

examples:World Health Organization guideline values for

air quality; EC quality standards for bathing waters; ECguidelines for heavy metals in agricultural soils to whichsewage sludge is applied

emission standards defining what releases of pollutants tothe environment are acceptable

examples: Protocols under the Convention on Long-RangeTransboundary Air Pollution of the United Nations EconomicCommission for Europe; EC limit values for emissions from

road vehicles

product standards specifying the composition of a product

examples: EC standards for motor fuels; EC limit and guidevalues for drinking water quality



16/91

Significant developments since the Commission reported in 1998are noted in the footnotes to this summary; a note on recent EUdevelopments in public participation in environmental policy-

making is in Appendix C.

Other forms of environmental standard

process standards identifying a set or sets of techniques fora specified industrial process in order to provide a criterionfor deciding what emissions to the environment should bepermitted from any given site

examples: Guidance Notes issued by the Environment Agencyfor processes subject to Integrated Pollution Control and bythe Secretary of State for processes which are regulated bylocal authorities for emissions to air

life cycle-based standards (see Box C) setting certain criteriathat the life cycle of a product should satisfy

example: EC ecolabelling scheme

use standards specifying conditions governing use of a

substance or product (or, in some circumstances, banningits use or establishing a programme for phasing it out)

examples: bans and restrictions under the EC Marketing andUse Directive; EC and UK procedures for authorising plantprotection, industrial chemicals, biocidal and veterinarymedicinal products

management standardswhich apply to the capability of acompany or other organisation to deal with the environmentaleffects of its operations

example: International Organization for Standardizationstandard ISO 14001 for environmental management systems



17/91

Figure 1Relationship of forms of standard for one substance (lead)

form

ofstandard

standardstoprotecthuma

nhealth

standardstoprotect

naturalenvironment

biological

exposure

quality

emission/process

product

use

*als

ofortheprotectionof

soilmicro-organisms

blood(work

ers)

air(workplace)

industrial

processes

dailyintake

air

motorfuel

blood(generalpublic)

agric

ultural

s

oil*

paint

food

solderin

cans

sew

age

slu

dge

drinking

water

pipes,

solder

inplumbing

sourcesof

drinkingwater

surfacewaters

indu

strial

processes,

sewage

effluent

gunshot



18/91

Scientific understanding

Scientific understanding is, and must remain, the essential basis

for environmental standards. Procedures have been developed

for assessing the effects of substances on human health and the

natural environment, and a wide range of data is used. The data

that would be most relevant, however, are often lacking, and the

available data are often subject to much uncertainty. In seeking

to base decisions about environmental issues on scientificevidence, there needs to be awareness of the nature of such

uncertainties, and their implications.

Introduction

As a predominantly scientific body, we focused in particularon different types of scientific evidence, the ways in which theseare used, and the potential for resolving present uncertainties

through further research. We believed that in setting anenvironmental standard, the starting-point must be scientificunderstanding of the cause of the problem or potential problemunder consideration.

To illustrate the general issues involved, we took as a case studythe procedures then current for assessing new and existingchemical substances under European Community (EC) legislation.These had the advantage of having been prescribed in somedetail. They sought to answer, in relation to each substancebeing assessed, three basic questions:

How intrinsically hazardous are the substances effects onhuman beings?

How intrinsically hazardous are the substances effects onthe natural environment?



19/91

How does the substance move through the environment,and what levels of exposure to it are likely to occur?

On the specific matter of chemicals legislation, and for an up-to-date account of developments in policy since the StandardsReport, readers should now refer to our Twenty-fourth Report,Chemicals in Products: Safeguarding the Environment and

Human Health, with its accompanying summary booklet,5

and the recent Government response.6

Assessing toxicity and the effects on human health andthe environment

Any substance is potentially toxic, in that it can cause injuryor death if exposure is sufficiently high. Most of the substancesto which biological systems are exposed in the environmentoccur naturally. In investigating the effects of substances on

biological systems certain methods and approaches are equallyapplicable, whether the objective is to protect human health orthe environment.

Much effort has been devoted to designing statistical models andmethods to describe and quantify the relationships betweensubstances and effects. In the human health context these areusually aimed at establishing a dose-effect relationship, fromwhich a threshold concentrationor threshold dosecan be

determined i.e. a numerical standard for exposure to thesubstance above which it is considered dangerous (or damaging)for people (or the natural environment) to be exposed.

Toxicology modelling is never straightforward. Applying differentmodels to the same data can give very different results. Westressed in the report that the use of any model of pollutant-effect relationships must be dependent on careful consideration

of the way it represents understanding of the development ofthe specific toxic effect under investigation. All exposure models



20/91

(and indeed all mathematical models used within scientificassessments) should be regarded with caution until they havebeen properly validated.

Nevertheless, despite all the difficulties involved, determiningdose-effect relationships for the effects of substances on thenatural environment is an essential exercise if appropriateenvironmental policies are to be adopted. When environmentalpolicies or standards are adopted, it should always be made clearin an explicit statement whether they are designed to protect thenatural environment, human health, or both, and the degree andnature of protection they are intended to afford.

Environmental pathways and assimilative capacity

Estimating the concentrations of a substance in the variouscompartments of the environment (water, air, soil etc) means

having to consider all potential sources of the substance e.g.manufacture, importation, transport, processing, use, disposal orrecycling. Estimating the doses of the substance to which peoplemay be exposed involves additionally considering all the routesby which they might be exposed, as workers, as consumers, andthrough environmental pathways. The nature and number ofpathways, and the rates at which substances move along them,will affect the extent and timing of exposure.

Whatever models are used to predict pathways and resultantexposures, they are at best only an approximation, given thecomplexity of the environment and the multiplicity of substancesbeing released into it. Unexpected effects may occur if asubstance is transformed into another substance by reactions inthe environment, is carried unexpectedly long distances, behavesdifferently in one location to another, or causes exposure throughseveral different pathways simultaneously. Box B gives examples



21/91

of adverse effects which, because of incomplete understandingof pathways and the behaviour of substances, were not foreseenat the time.

The ability of the environment to absorb substances withoutundergoing significant measurable change has been termedits assimilative capacity. In some cases potentially harmfulsubstances are broken down by natural processes into simplecompounds (e.g. water or carbon dioxide) or into less harmfulby-products. In others, substances can be retained in sinks(e.g. deep sediments), where if not actually destroyed theyare believed no longer to pose a hazard, so long as they remainundisturbed.

Scientific understanding has moved on from the simplisticdistinction that used to be drawn between pollution andcontamination (the latter being applied to substances which

are present at detectable levels but not believed to be potentiallyharmful at those levels). The environment is exposed to manydifferent stresses, and determining its assimilative capacity,particularly for simultaneous exposure to more than onesubstance, is difficult. As Box B demonstrates, there are gaps inunderstanding of whether particular quantities or concentrationsof substances, or combinations of substances, will cause harm.As a result, scientists assumptions about assimilative capacity

have tended to become more cautious.



22/91

It is reasonable to assume (e.g. in the context of chemicals7) thatscientific calculations of the impact of releasing substances indifferent quantities and permutations will gradually become moreprecise and robust; but there is also a more general point, towhich we devoted a chapter headed Articulating Values. Almostinvariably, decisions about what use to make of the environmentinvolve judgements and depend on questions of values.Criteria which depend on a distinction between significant

and insignificant are a case in point. The extent to whichenvironmental values can be a matter of contention is illustratedby the Brent Spar case8 and the even longer running sagaof permanent disposal of nuclear waste. Decisions do notnecessarily turn on who wins the scientific argument but canbe driven by ethical objections to the action proposed in thisinstance the use of the sea bed or deep underground repositoriesfor waste disposal. Unfortunately they can also be influenced

by bad logic or deliberate distortion.

Output from scientific assessment

From this review of the application of scientific assessmentto environmental decision-making we drew the followingmain conclusions:

The starting point, in setting an environmental standard, must

be scientific understanding of the cause of the problem orpotential problem. But, as the Brent Spar case demonstrated,environmental policies cannot be decided simply on thebasis of scientific evidence. For the majority of environmentalstandards, as well as for broader policies, there needs to be aprior stage of defining what the problem is, framing questionsand formulating policy aims.

Judgements over whether to release pollutants into the

environment raise questions of values which cannot beanswered simply by referring to the scientific evidence.



23/91

BOX B SOURCES OF ERROR IN ASSESSING PATHWAYS

AND EXPOSURES

The form in which a substance is released is not

necessarily that in which it remains. Substances releasedto the environment are subject to a wide range of possibletransformation processes, including biodegradation, hydrolysisand photodegradation, as a result of which they may be

transformed to more or less harmful products or more orless permanently immobilised by adsorption onto soils andsediments. One example of transformation leading to amore toxic substance is provided by mercury. Bacterialtransformation of insoluble, inorganic, biologically unavailablemercury salts in Minamata Bay, Japan, led to the formation ofsoluble, bioaccumulative and toxic methyl mercury, capable ofentering the aquatic ecosystem. Methyl mercury accumulated

in fish which were then eaten by the human population. Toxiceffects ensued, including the birth of handicapped children tomothers who themselves appeared unaffected.

The location in which a substance is released is not

necessarily that in which it has its most important

effect. Environmental transport mechanisms move substancesfrom their point of release to other locations or to otherenvironmental media. Processes such as volatilisation,

advection and adsorption determine the distribution of achemical in the environment in space and time, and havebeen responsible for the discovery of pollutants in unexpectedplaces. The presence of persistent organic pollutants, such aspolychlorinated biphenyls (PCBs), in otherwise unpollutedparts of the globe, for example the polar regions, and theirsubsequent bioaccumulation in the fat tissues of organisms,has been attributed to repeated volatilisation, condensation

and deposition cycles which transport them away from theirpoint of release.



24/91

Estimation of the assimilative capacity of the environment is ascientific procedure; but judgements on how far the assimilativecapacity should be used in particular circumstances, or thedegree of precaution required in taking policy decisions, are

part of a wider political process. A clear dividing line, therefore,should be drawn between analysis of scientific evidence and

Behaviour in one location does not guarantee the same

behaviour in another. The effects in Cumbria from theChernobyl nuclear accident illustrate the need to take intoaccount local conditions. The assumption that in Cumbriaradioactive caesium would quickly become immobilised insoils and would not pose a long-term threat to the sheepfeeding on local grass was based on the response of the claymineral soils of southern England to radioactive exposure. Thepeaty, acidic soils of Cumbria did not immobilise caesium asexpected. It remained available for root uptake into grass andfound its way into the bodies of sheep; exposure of lambs toradioactivity through grass consumption, which was predictedto last a few weeks only, has continued for much longer.

There may be simultaneous exposure to the same

substance from different media and sources. Exposure of

humans and animals can occur through inhalation of airbornepollutants, ingestion of pollutants in food and drinking water,and skin absorption. As another example, limit values havebeen set to protect agricultural soils from the adverse effectsof certain metals through the addition of sewage sludge. Othersources, including airborne deposition from industrial andtransport sources, deposition in other wastes or the presenceof natural metal deposits, which are not as well-characterised

or controlled as sewage sludge, may be more significant interms of overall concentrations and accumulation of metalsin soil.



25/91

consideration of ethical and social issues which are outside thescope of a scientific assessment.

In a scientific assessment of an environmental issue there arebound to be limitations and uncertainties associated with thedata at each stage. Standard-setting and other decision-makingprocedures should recognise that.

The requirement for sound science as the basis for

environmental policy is not a requirement for absoluteknowledge or certainty and should not be interpreted as such.

When considering the process of scientific assessment and itsoutput, two separate issues need to be addressed:

i. Is the science well done, and are uncertainties andlimitations in the data properly recognised?The answerto this question determines whether the assessment

represents good science.ii. Does the science provide a firm basis for policy decisions?

The answer to this question determines how useful theassessment will be to the policy-maker, whether decisionswill have to be taken in the face of uncertainty, andwhether further studies (perhaps including experimentalwork) should be carried out.

Scientific assessments should indicate clearly where theboundaries of knowledge lie. To be helpful to policy-makersthey should indicate clearly both what is known or consideredto be indisputable and what is considered to be speculative.

Scientific assessments should be presented in a transparentand even-handed way. A succinct narrative summary ofthe assessment presenting the underlying scientific basis,uncertainties in the scientific evidence and the rationale for

any methods used to cope with variability and uncertainties



26/91

(for example, any safety or uncertainty factors used) and theassumptions implicit in their use is essential.

A scientific assessment should present the range of possibleinterpretations of the available evidence, or the range ofscientific possibilities and options concerning a particularcourse of action, accompanied by acknowledgement of theassumptions and uncertainties implicit in the assessment.The output of a scientific assessment should not normallybe presented as a single option or statement; an assessmentyielding a single answer (especially a single number) maygive a spurious impression of accuracy.

We cannot emphasise too strongly the importance of maintainingoverall standards of impartiality in the procedures used forscientific assessment, especially in situations of high uncertainty.Judgements can be swayed, perhaps imperceptibly, by one or

another kind of vested interest. One much remarked upon, andcriticised, feature of regulatory science in the past has been theextent to which experts in an industry, the contract laboratoriescarrying out the standard tests for it, and the regulatory body itselfhave functioned in some instances as a largely closed community.

The reports conclusions have continuing implications for scientificresearch. First, review processes and the potential for revisionshould be built into standard-setting procedures. Scientific

knowledge can move rapidly and standards must be readilyadjustable and regularly reviewed, so that new insights can beincorporated. Secondly (and leading on from the point just made),to avoid any risk of development of knowledge and itsapplication being inhibited by established regulatory procedures,vested interests or small closed communities of experts, publiclyfunded programmes of environmental research should includeprovision for independent investigation and inquiry.



27/91

Technological options

Many environmental standards have been based on a view about

what was practicable in the context of a particular industrial

process or in the design or composition of a particular product.

Impact on the environment is now being analysed in a broader

way, covering whole companies or product chains. Effective

protection of the environment will depend increasingly on

taking environmental considerations fully into account whentechnologies are selected, developed and applied. Standards must

be set in ways that stimulate companies to adopt clean technology.

Environmental standards based on technology

Analysis of technological options is an essential component inthe analyses needed to underpin decisions about environmentalpolicies and standards. The environmental implications of

technological developments need to be thoroughly assessedbefore they are applied on a wide scale. But depending onthe type of standard involved (see Box A), technologicalconsiderations come into play in different ways. For example,biological standardsor exposure standardswill depend on theavailability of analytical techniques to confirm compliance withthe standards. Emission standards(e.g. for motor vehicles) areoften set at the level which it is known an available technology

can achieve; to encourage improvement, this may be morestringent than the level typically found in products currentlyin use. Process standardsare set by regulatory authorities(e.g., in England and Wales, the Environment Agency).

As we noted in the report, there has been a steady movementtowards taking a broader, more comprehensive and integratedview of environmental impacts and pathways across air, waterand land. This approach is necessary to avoid the pitfalls of toolimited an examination of technological options, which can resultin mere displacement rather than reduction of environmental



28/91

damage. The approach is enshrined in the 1996 EC Directive onIntegrated Pollution Prevention and Control (IPPC), reflectingpractices of certain Member States, notably the UKs concepts ofbest practicable environmental option(BPEO) pioneered bythe Royal Commission in the Fifth Report9 as long ago as 1976 and ofbest available techniques not entailing excessive cost(BATNEEC), both of which are embodied in UK legislation.10

Taking into account the whole life cycle of productsand processes

With the development of the IPPC approach, environmentalregulation has broadened from considering emissions to a singleenvironmental medium to considering emissions to all mediafrom a process. At the same time, analysis of environmentalperformance has been extended even further to cover thewhole material and energy supply chains associated with aproduct or service.

Taking account of life cycle considerations-otherwise knownas life cycle assessment or analysis (LCA) (see Box C)-is thepreferable way of managing the overall environmental impactof particular processes or particular industrial sectors becauseit directs attention to the points at which intervention to protectthe environment will be most effective and efficient. Whilst

recognising that LCA did not easily translate into measurableor enforceable standards, we proposed in the report that, toensure that the full ranges of options and repercussions wereconsidered, assessments of technological options carried out asinputs to decisions on environmental policies or standards shouldbe on a life cycle basis.



29/91

We noted that clearer policy guidance was needed on wherethe boundaries of LCA should be drawn, and that rigorousapplication of LCA would impose particular demands on theskills and qualifications of regulatory authority staff, not least tocounter-balance vested interests in the regulated industries. Toooften in the past, decisions about setting environmental standardshave been driven by considerations of practicability which wereproduced by those with a vested interest in avoiding change and

were unduly pessimistic about technological possibilities.

BOX C LIFE CYCLE ASSESSMENT

Building on methodological developments by the Societyof Environmental Toxicology and Chemistry (SETAe),International Organization for Standardization standard ISO14040 defines life cycle assessment (LCA) as follows:

LCA is a technique for assessing the environmental aspectsand potential impacts associated with a product, by

compiling an inventory of relevant inputs and outputs ofa product system;

evaluating the potential environmental impacts associatedwith those inputs and outputs;

interpreting the results of the inventory and impactassessment phases in relation to the objectives of the study.

LCA studies the environmental aspects and potential impactsthroughout a products life (i.e. cradle to grave), from rawmaterial acquisition through production, use and disposal.The general categories of environmental impacts needingconsideration include resource use, human health, andecological consequences.



30/91

Output from assessment of technological options

We concluded that:

the aim of assessments of technological options should be seenas widening the range of options considered, including thosethat involve technology forcingor commercialisation forcingstandards i.e. those which encourage beneficial advances intechnology or commercial exploitation of existing state-of-the-

art technology;

particular options should not be excluded from life cycleassessments on the ground that action required to implementthem falls outside the responsibilities of the immediateregulator;

to the extent that regulation of industrial activities continuesto use permits and forms of standard on lines similar to those

used at present, their use should in future be informed by a lifecycle perspective; if necessary, there should be changes inlegislation so that the full potential for that can be realised;

broadly based assessments of options on a life cycle basismust not be allowed to become an excuse for avoidingor delaying significant improvements available at particularstages in the cycle;

there should be scope for suppliers or users of improvedtechnologies to stimulate tightening of standards.

On whatever basis technological options are compared, thereremains a fundamental conceptual and methodological problem:how can different kinds of environmental impact, which are notdirectly commensurable with each other, be in included in anoverall assessment? Judgements have to be made about whichaspects of environmental impact are more important, and about

the acceptability of effects in different locations. Such judgementsdepend fundamentally on values.



31/91

Risk and uncertainty

Environmental issues are now frequently addressed through

risk assessments. It has been suggested that environmental

standards might be set by relating the probability of harm from

environmental causes to the probabilities of harm from other

causes. There are various problems about such an approach.

It is now generally accepted that environmental policies should

be based on the precautionary principle, properly interpreted.Appraisals of risk are an essential input to decisions about

environmental standards, but need to have several dimensions

and also cover the extent of uncertainty.

Risk assessments, statistical probabilities andtheir limitations

Systematic analyses of risk (risk assessments) are another aid to

decision-making on environmental policies and standards. Theconcept of risk assessment is derived from engineering, whereriskhas been defined by the British Standards Institution as acombination of the probability, or frequency, of occurrence ofa defined hazard and the magnitude of the consequences ofthe occurrence, and hazardas a property or situation that inparticular circumstances could lead to harm. Put more simply,hazard means anything that can cause harm and risk is the

chance, high or low, that somebody (or something) will beharmed by the hazard.11

Basic risk assessment can be used to compare the risks, based onstatistical probabilities, of different hazards occurring and to setboundaries of acceptability and unacceptability by analogy: forinstance, if the public in general is willing to accept a risk of1 in 10,000 of dying in a traffic accident in any one year, thenin principle a lower risk (e.g. 1 in 100,000 or 1 in a million) ofdying from an environmental hazard ought to be tolerable.



32/91

In practice the situation is more complex. As we have seen,scientific understanding leaves considerable uncertainties aboutthe environmental effects of activities such as the introductionof new substances or discharge of wastes. Calculating statisticalprobabilities can be problematical outside straightforward fieldslike traffic or industrial safety. Reliance on probability of death asa measure of severity excludes other effects e.g. chronic illnessor environmental damage; there is no accepted definition of

ecological health.

Although estimates of risk are often presented as the objectiveoutcome of a scientific assessment, they frequently go wellbeyond what could be justified in terms of rigorous use of thescientific evidence. At some points in the assessment, scientificevidence is likely to be inconclusive, at other points, entirelylacking. In the absence of data, working assumptions are usuallyneeded to cope with the variability of populations and exposures,weaknesses in toxicity assessments, uncertainty about responses,and lack of knowledge about other data, including the effects ofmixtures of chemicals. Inevitably the assumptions used are thoseof the practitioners making the assessment. These assumptionsmay be widely shared amongst the expert community but theycannot realistically be said to yield objective assessments. Otherpeople, making different but equally valid assumptions, mayproduce substantially different estimates of risk.

Even if it is possible to estimate accurately the statisticalprobability of a specified event, that probability may not byitself be an appropriate basis for reaching a judgement aboutthe tolerability of the human activities which give rise to it:

Risks arise out of different social contexts and thereforehave different social meanings. Risks incurred voluntarilyare generally regarded as being quite different from those

suffered involuntarily.



33/91

Peoples willingness to accept risks over which they have nocontrol will be strongly affected by whether they see benefitsflowing from the activities which give rise to the risk, and bytheir perception of who stands to benefit the most.

Risks themselves may be unevenly distributed: they may be, forexample, higher for children or pregnant women, or liable tofall on future generations.

Public acceptance of risks

Peoples perceptions of risks, and their relative importance,vary enormously and do not fall into any coherent pattern.Traditionally it has been assumed that perceptions can becorrected by provision of better information. But there is noevidence that giving people raw statistics is an effective wayof changing attitudes. Risk communication needs to be a subtler

and more interactive process, which takes into account thecircumstances in which information is presented to people. Whatis more, the credibility of communicators is critically dependenton the trust placed in them-which in turn depends on how thepublic perceives the competence and good faith of thoseresponsible for controlling the risks.

The precautionary principle

One of the ways in which environmental policy is able to reflectscientific uncertainty is through the so-called precautionaryprinciple in effect a reversal of the burden of proof wherethe potential for serious harm is suspected but cannot bedemonstrated conclusively. The principle is encapsulated inPrinciple 15 of the 1992 Rio Declaration on the Environmentand Development:

In order to protect the environment, the precautionaryapproach shall be widely applied by States according to their



34/91

capability. Where there are threats of serious or irreversibledamage, lack of full scientific certainty shall not be used asa reason for postponing cost-effective measures to preventenvironmental degradation.

The principle has been reflected in successive EC treatiessince Maastricht and has featured in various guises in manyinternational conventions and declarations. Examples, currentat the time of the report, of international expressions ofthe precautionary principle are set out in Box D.12 Overall,the picture remains one of intellectual confusion over theapplicability of the principle. As we commented, theprecautionary principle has been one of the most controversialprinciples of environmental protection, and there has been muchuncertainty about what it implies (paragraph 4.42).

Assessment of risk and uncertainty and its application toenvironmental standards

Although the aim of our report was to explore the scope forextending risk assessment from the traditional fields of health andsafety to the broader field of the environment, we were forced toconclude that no satisfactory way had been devised of measuringrisk to the natural environment, even in principle, let alone ofdefining what scale of risk should be regarded as tolerable.

The probability of a human death offers no guidance about theseverity of effects on the natural environment. The concept ofecological health can be given a wide range of meanings. It ispossible to measure risk in specified circumstances to specifiedcomponents of the environment, but this would not amount toa comprehensive assessment of ecological risk.

Nevertheless, we did attempt to set out in the report somegeneral principles which we felt should apply to the preparation

of environmental risk assessments. We saw the assessment of riskand uncertainty dealing with two important components:



35/91

BOX D INTERNATIONAL EXPRESSIONS OF THE

PRECAUTIONARY PRINCIPLE

Marine pollution

1984 Bremen Ministerial Declaration of the International Conference

on the Protection of the North Sea

States must not wait for proof of harmful effects before takingaction

1987 London Ministerial Declaration of the Second InternationalConference on the Protection of the North Sea

in order to protect the North Sea from possibly damaging effects ofthe most dangerous substances, a precautionary approach isnecessary

1992 OSPARConvention

preventive measures are to be taken when there are reasonablegrounds for concern ... even when there is no conclusive evidence

of a causal relationship between inputs and their alleged effectsAtmospheric pollution

1980 EC Council Decision 80/372 concerning chlorofluorocarbons

(CFCs) in the environment

... a significant reduction should, as a precautionary measure, beachieved in the next few years in the use of CFCs ... giving rise toemissions

1985 Vienna Convention for the Protection of the Ozone Layer

... mindful also of the precautionary measures for theprotection of the ozone layer which have already been taken at thenational and international levels

1987 Montreal Protocol

although aware that measures should be based on relevant

scientific knowledge, the Parties are Determined to protect the

ozone layer by taking precautionary measures to control equitably

total global emissions of substances that deplete it

cont.



36/91

1992 Climate Change Convention

Parties should take precautionary measures to anticipate, preventOt minimise the causes of climate change and mitigate its adverseeffects; Where there are threats of serious or irreversible damage,lack of full scientific certainty should not be used as a reason forpostponing such measures, taking into account that policies andmeasures to deal with climate change should be cost-effective so asto ensure global benefits at the lowest possible cost

Nature conservation

1992 Biodiversity Convention

where there is a threat of significant reduction or loss of biologicaldiversity, lack of full scientific certainty should not be used as areason for postponing measures to avoid or minimize such a threat

1994 Fort Lauderdale Resolution to the 1973 CITES Convention

when considering proposals for amending the lists of endangeredspecies within the Convention, Parties shall apply the precautionary

principle so that scientific uncertainty should not be used as a reasonfor failing to act in the best interest of the conservation of the species

General international law-making

1990 Bergen Ministerial Declaration on Sustainable Development in

the ECE Region

In order to achieve sustainable development, policies must be basedon the precautionary principle, Environmental measures mustanticipate, prevent and attack the causes of environmental

degradation. Where there are threats of serious or irreversibledamage, lack of full scientific certainty should not be used as areason for postponing measures to prevent environmentaldegradation

1992 Rio Declaration on Environment and Development (Principle 15)

In order to protect the environment, the precautionary approachshall be widely applied by States according to their capabilities.

Where there are threats of serious or irreversible damage, lack offull scientific certainty shall not be used as a reason for postponingcost-effective measures to prevent environmental degradation.



37/91

looking at broader uncertainties about the current issuewhich extended beyond the available scientific evidenceand considering a wider range of possibilities;

where sufficient data were available, quantifying and analysingthe risks associated with the issue under consideration.

The relative importance of these two aspects will vary accordingto the circumstances, and in any given case one of them may

predominate. We went on to set out a number of conclusions.

Risk assessments prepared in support of decisions onenvironmental policies or standards should start with informationabout the nature of the hazard which the policy or standardseeks to address and the extent and quality of the evidenceavailable for assessing the risks it poses. This part of the analysisshould indicate whether the hazard is of a relatively well-understood type; if it is unfamiliar, an attempt should be madeto identify the most nearly analogous hazards and the aspectswhich are not understood.

The limitations and uncertainties in any estimates of risk mustalways be made clear in ways which are meaningful to peoplewithout particular specialist knowledge. Risk assessments shouldidentify the uncertainties which have the largest implicationsand the actions that would need to be taken to reduce or

resolve them. However, it would be inappropriate andmisleading to attempt to incorporate into risk assessmentsestimated probabilities for the correctness of particular scientifictheories or interpretations.

Whatever action is taken in the name of precaution (from use ofworst-case scenarios and safety factors in assessments through toapplication of the precautionary principle in decision-making),it should be transparent and subject to review in the light of

development of understanding. Relevant data should be collected



38/91

and reviewed on a continuous basis; and if a standard has beenset, it should be revised up or down as necessary.

If there are sufficient data, and sufficient knowledge of theunderlying processes, quantitative risk assessments should covernot only risk of human deaths but risks of other harmfuloutcomes. For each estimate the assumptions made shouldbe explicit and clearly stated.

As well as distinguishing between different types of effect froma hazard, risk assessments should also:

indicate the distribution of risks (whether they are especiallyhigh for people in certain localities, age groups or occupations,or people with certain medical conditions or geneticpredispositions);

characterise as far as possible the respective perceptions of the

risks held by relevant groups, the meanings the risks will havefor them, and their views about the tolerability of the risks.

Quantitative information on these points should be providedwhere it is available, otherwise qualitative assessments shouldbe given.

For risks of the same general type, and where data are availableand the processes sufficiently understood, direct comparison

between options may be useful in informing decisions,for example:

between the risks from the hazard being addressed and otherrisks of the same general type affecting the same group ofpeople or compartment of the environment, so that estimatescan be made of the total risk of that type to which these willbe subject;

between the risks from the hazard being addressed and therisks from different sources or pathways for the same pollutant



39/91

or different pollutants from the same source, in order toidentify any options for risk reduction that might obtain alarger benefit for a similar cost.

However, making comparisons between risks which the publicdoes not perceive as comparable can undermine the credibilityof regulators and governments.13

Risk assessments cannot establish a relationship on any objective

basis between risks of different types or between risks imposedon different groups of people, because to do so raises valuequestions. It has been generally recognised that publicperceptions of risks which diverge from expert estimates arenot necessarily irrational but may well reflect different valuesfrom those underlying the expert assessments. To pursue andresolve these differences in perceptions and values we need tofind better methods of communicating information about risk and

better ways of interpreting it.Inevitably the report leaves unresolved the question whetherbetter communication can ever bring about a convergence ofviewpoints which rest upon diametrically opposed beliefs. Inextreme cases, reconciliation of opposing views (e.g. Darwinianevolutionary theory versus creationism) cannot be achievedunless the two sides enter dialogue with open minds. Theimpasse over the science and ethics of genetically modified

foods remains a topical example.



40/91

Economic appraisal

Economic appraisal aims to facilitate the choice between

alternative policies by providing an assessment of their respective

costs and benefits. Practical problems can arise when an attempt

is made to place valuations on some of the consequences

of environmental policies. Issues of principle may also be

raised. There are differing views on what assistance economic

appraisals can provide when decisions have to be made onenvironmental policies.

Economic appraisal and environmental standards

The role of economic appraisal in decisions on environmentalstandards has been much debated. At its simplest level, it canhelp in cases where, for instance, decisions have to be taken onwhere to set the limits for polluting emissions from industrial

plants. Application of cost-benefit analysis will reveal the trade-off between the benefits (to consumers and the nationaleconomy) of producing and using the products of the plant andthe disbenefits (to public health and the environment) arisingfrom pollution caused by the production process. The tighter thepollution controls, the greater the costs of production, which mayreach the point where the firm is impelled to seek alternativeproduction methods or to diversify into more profitable areas.

In classic economic theory, the best outcome is achieved ifthe controls are set at a level which, for a given productiontechnology, maximises peoples welfare. In practice, it is not amatter of straightforward calculation. Purchasers of the productsof the plant will not necessarily be the same as those exposed topollution from it; different groups of people are therefore likelyto have different views about the benefits of imposing limits onpollution and the effect on consumer prices.



41/91

Best practice in economic appraisal

The report summarised guidance issued by the Treasury andthe then Department of the Environment (DOE) on bestpractice in economic appraisal and on how to take account ofenvironmental effects during policy appraisal. We noted thatwhilst the guidance was useful in ensuring that policy optionswere looked at in a comprehensive and systematic way, thereusually remained a substantial degree of uncertainty about theconsequences of most policies, particularly standards relating tothe environment or to health and safety.

BOX E PUTTING A MONETARY VALUE ON

ENVIRONMENTAL DAMAGE

OUTPUT-BASED METHODS an example of an output lossis the money value of a reduction in crop, forestry or fishery

yield caused by environmental damage. A focus on outputeffects may disregard other impacts over which people areconcerned. In particular, ill health may stop people fromworking, but may also cause pain, grief and suffering.

PREFERENCE-BASED METHODS seek to take explicitaccount of the preferences, constrained by available income,of those people who will be affected by a particular policydecision. Broadly speaking, they are of two kinds:

revealed preference methods

preventive expenditure: the amount paid to preventor ameliorate unwanted effects, for example expenditureon insulation and double-glazing to keep out noise(sometimes a community valuation can be inferred, as whengovernments provide grants towards such expenditure)replacement/restoration cost: the amount individuals spend

on, for example, the restoration of damaged buildingsor landscapes



42/91

property valuation: differences in the market valueof similar properties that reflect differences in the localenvironment, for example the amount by which the priceof a house is lower because it is next to a busy road

compensating wage differentials: the premia in wagerates in occupations that are riskier or have above averagehealth hazards, from which money values for preventing

fatal and non-fatal health effects can be inferred

expressed preference methods

contingent valuation: asking people to say either howmuch money they would be willing to accept to compensatefor unwanted effects or(which tends to produce lowervaluations) how much money they would be willing to payto avoid unwanted effects (but the amount people say they

would be willing to pay may differ from the amount theywould be willing, or able, to pay in practice)

conjoint analysis: asking people to rate or rank alternativebundles of attributes of a good, service or policy option(for example, bundles comprising specified amounts ofenvironmental damage; health effects; effects on wildlife; etc.)and eliciting from their rankings or ratings the implied rates atwhich they trade off one attribute for another. If one of the

attributes is money, implicit money valuations can be inferred

relative valuation: determining the relativevalue peopleplace on a good or service by comparing it with anothergood or service for which a money value has already beenestablished, for example deriving money values for preventingnon-fatal road injuries of different severities from the moneyvalue previously determined for preventing road fatalities



43/91

Valuing environmental policy options for which there isno market price

Some of the consequences of a possible policy or standard are ofsuch a kind that they can be valued relatively easily in moneyterms for example the costs of installing and operatingpollution control equipment or the administrative costs ofregulation. But nearly all environmental policy options haveimportant consequences for which there is no market price.These may include implications for human health or theconservation value of particular areas of land. The appraisaleither has to use a method of valuing such consequences inmoney terms or simply to provide qualitative descriptions ofthem. Box E lists some of the techniques used to impute moneyvalues to non-marketed consequences of environmental policies.The purpose in doing so is not to estimate what the price of apolicy would be if it were to be traded but to communicateevidence (in the words of the DOE guidance) on the relativevalues which society places on different uses of resources.

Practical application of economic appraisal

Debate over the usefulness of economic appraisal in supportingdecisions on environmental policies has been at two levels. Onelevel is the practical difficulty of establishing numerical values on

the basis of inadequate or conflicting evidence and the uncertaintythat surrounds the effects of much environmental policy. Atanother level there is scepticism about the validity of cost-benefitanalysis in particular and about welfare economics in general.It is argued that that cost-benefit analysis does not properly takeaccount of values associated with the environment, and thatattempts to aggregate such values is objectionable in principle.

Cost-benefit analyses can give very wide ranges of money values

for the costs and benefits of environmental policies; moreover,different studies of the same issue have produced widely



44/91

different valuations, one example being the environmental andsocial costs of road transport. Changes in a critical assumptioncan also lead to markedly different implications for policy.

Output from economic appraisal

Our examination of the role of economic appraisal inenvironmental standard-setting led us into a complex debate,for an account of which we must refer readers to Chapter 5of the report. But the conclusions of our debate can be statedquite succinctly:

Economic appraisal should be regarded as an aid to makingdecisions which also take other factors into account. Formaltechniques such as multi-criteria analysis14 should likewise beregarded as aids (but not full answers) to decision-making.

An economic appraisal of an environmental policy or standardshould identify the objectives of the policy or standard andthe options to be considered; summarise and analyse all theconsequences of the options; and indicate what that analysisimplies for the decision that has to be made. It should coverconsequences which cannot easily be valued in money terms,as well as those that can be easily valued in money terms.

Where consequences are not valued in money terms, they

should be represented either qualitatively or in terms of otherquantities. It should indicate the timing of the costs and benefits.

When performing an economic appraisal it should be borne inmind that the relative values of the things under considerationmay change over time.

The report of the appraisal should describe the majoruncertainties. It should include a sensitivity analysis showing

the effects of changing key assumptions.



45/91

The report of an appraisal should normally incorporate adescription of the information that will need to be collected toenable a retrospective evaluation of the policy or standard tobe undertaken at a later date.

We stressed the point that economic appraisal is but one ofseveral complementary components in the analytical stage ofthe policy process. It is by no means value-free. It is in fact aform of value appraisal which assumes the validity of monetarystatements. Like scientific analysis, economics is able to addressonly some of the components of public value perception.

To the extent that peoples values as expressions offundamental commitments to the environment or to equity,whether within society or between present and futuregenerations are regarded as not answerable to economicappraisal, the question then arises whether there is any other

approach that could provide additional assistance to decision-making in that respect. We devoted Chapter 7 of the report toexploring novel approaches to obtaining information aboutpeoples values, as a component of environmental policy-making.These take into account the fact that peoples values are notnecessarily pre-formed and may be in conflict with each other.Such approaches are not intended to replace the need toconsider the economic implications of choices in relation

to standards. Like cost-benefit analysis, they will be moreappropriate in some cases than others, and will be givengreater prominence in some areas than others. What isimportant, however, is a recognition of the need to developnew approaches in a situation of increasing complexity.



46/91

Implementing environmental policies

The effectiveness of environmental standards in modifying the

actions of companies or individuals derives from the methods

used to implement them. One influence on the choice of method

is the geographical scope of standards. For the most familiar

forms of standard, compliance is supervised by a government

agency and failure to comply may be a criminal offence. Other

approaches to implementing environmental policies are receivingincreasing emphasis. Those approaches have both advantages

and limitations. In order to be effective and acceptable, they

may themselves require new forms of standard to be set.

Introduction

The purpose of environmental policies is to influence humanbehaviour in order to avoid or limit damage to the environment.

Human behaviour is determined by complex sets of individualand social factors. The values people hold are an importantdeterminant of behaviour, and ultimately shape environmentalpolicies. The adoption and implementation of policies based onparticular values have a powerful effect in reinforcing thosevalues, as well as ensuring that they are put into practical effect.

The tendency for more and more environmental standards to beprescribed by EC legislation or international conventions hasreinforced traditional practices of direct regulation-i.e. where thestate regulatory authorities restrict or ban potentially damagingactivities, or allow them subject to conditions, usually undersome form of licence or permit and with criminal sanctions fornon-compliance. But there has also been a trend towards otherways of influencing behaviour and encouraging environmentalawareness. These do not rely directly on legal compulsion butinclude the use of economic instruments (e.g. tax incentives andgrants), public education campaigns, and encouragement of goodpractice in industry through self-regulation.



47/91

Geographical scope of standards

The social factors influencing human behaviour vary from countryto country, and in some cases between communities withincountries. Some environmental problems are localised, but theresponse to other problems involves taking measures over muchwider areas. There is a relationship between the geographicalscope of an environmental standard and how it can beimplemented most effectively.

We expressed the view in the report that, as a general principle,environmental standards should be set for the smallest area forwhich it was sensible and effective to do so. Where a standardwas set at a European or international level, we considered itshould be set in a form that allowed as much discretion over themethods of implementing it as was feasible without underminingits effectiveness.15

Despite attempts to resolve the situation, we noted a need forgreater effort in drawing up an internationally agreed set ofprinciples to deal with the potential difficulties caused by theoverlap between the General Agreement on Tariffs and Trade(GATT) rules and trade provisions contained in multilateralenvironmental agreements (MEAs), and for ambiguities in theoperation of the GATT to be clarified.

Direct regulation

It is not practicable to make compliance with an environmentalstandard subject to legal sanctions if the standard is in sucha form that no company or person can sensibly be heldresponsible for breaches. Direct regulation in the UK has tendedto be more flexible, and more administrative than legal incharacter, compared with practice in some other countries

(notably the United States). Of the environmental standardsbased on pathways (the first category in Box A above), it is



48/91

only to emission standards or product standards that criminalsanctions can be applied in any straightforward way.

The report suggested the following guidelines for effectivestandard-setting in this area:

An essential condition for effective direct regulation is thatthere should be adequate inspection and adequate monitoringof compliance with limit values.

Numerical standards for concentrations of substances shouldalways incorporate protocols for sampling and the analyticaltechniques or methods by which compliance is to bemeasured, and should require analyses to be carried outin laboratories which are participating in appropriateaccreditation and proficiency testing schemes.

Every numerical standard should be specified in a way that

takes full account of the nature of the substance to which itrelates, the extent of statistical variation in the parameter towhich it relates and (where it is legally enforceable) therequirements for verification. Many current environmentalstandards are defective in terms of these criteria, most oftenin not being verifiable. Where that is the case, it should beremedied by setting a supplementary standard for verification,with the aim that environmental standards should be, wherever

possible, statistically verifiable ideal standards. Reviews ofexisting standards should pay particular attention to this aspect.

We noted a number of drawbacks in direct regulation. Forinstance, enforcement bodies may be subject to regulatorycapture by the industries they regulate; and whilst inspectorscould be as well informed as companies on technologicalaspects, they were less likely to be as well informed aboutother aspects of the business which might be relevant.



49/91

Such drawbacks of direct regulation and the tensions to whichit may give rise mean there are considerable attractions incomplementary approaches which seek to internaliseenvironmental considerations within the decision-makingprocedures of potential polluters, either in financial termsor in cultural terms.

Economic instruments

Environmental policy aims to discourage polluting activities. Oneway of doing that is to encourage producers and consumers tochoose less damaging processes and products by modifyingmarket prices. This might take the form of taxing products andservices which are to be discouraged on environmental groundsor subsidising those which are to be encouraged.

The report concluded that economic instruments were not a

panacea, and might need to be reinforced by administrativecontrols as well; nevertheless we saw merit in using economicor financial incentives wherever possible to reinforce the effectof direct regulation. We added:

Well-designed economic instruments should be capable ofachieving a better overall result for the environment, byproviding incentives for the introduction of clean technologyand other innovations, although improvements are likely to be

differently distributed and the environmental outcome in someareas might be inferior to that which would have been broughtabout by direct regulation.

Use of economic instruments should also limit the cost ofenvironmental protection, both in resources used and intransaction costs. They are especially valuable in controllingpollution from diffuse sources.



50/91

Use of economic instruments does not dispense with the needfor legislation, monitoring and criminal sanctions because alegal framework is required for their operation.

Self-regulation

The Commissions study coincided with widespread andaccelerating interest in self-regulationas an approach toenvironmental policy. Among other things, the term would cover(in companies) environmental management systems, productlabelling going beyond statutory requirements, negotiatedagreements entered into with governments or governmentagencies, and release of information to the public about theenvironmental impact of company operations. Under thisheading we concluded:

Many actions that benefit the environment are taken primarily

or exclusively because individuals, either on their own accountor as company managers, place a high value on protecting theenvironment.

One form of action that many people take is to buy productswhich they believe to have been produced in ways that areenvironmentally sustainable or to be less damaging to theenvironment than competing products.

Many environmental claims for products are made in veryvague terms, and may have only a flimsy basis. To be effective,standards for making environmental claims need to beestablished on a European or global scale.

There is a need for the relationship between labelling schemesand the GATT rules to be clarified. It is important to ensure thatecolabelling schemes do not disadvantage developing countries,for instance by being used as pretext for non-tariff barriers.



51/91

Firms should be strongly encouraged to install environmentalmanagement systems; in due course all firms above a certainsize might be required to operate such systems, in a formwhich involves regular publication of information about theirenvironmental performance.

Basic issues arise over how transparency and openness can beincreased, and accountability maintained, in a system in whichthere is a substantial measure of self-regulation. Accountabilityfor the state of the environment might become more difficultto locate and environmental protection systems might becomeless objective. Legislation on public access to environmentalinformation would need to be supplemented by publicationof much more information about companies emissions to theenvironment, backed by suitable sanctions.

New forms of standard, possibly with legal force in some cases,

can help to make self-regulation function more effectively.For instance, there could be a strong case for developingstandards for the application of methodologies such as lifecycle analysis and assessment of the total burden which acompanys activities place on the environment. These couldbe reflected in amendments to the Companies Acts.

Output from implementation analysis

Our overall conclusion was that self-regulation and the use ofeconomic instruments should be regarded not as alternativesto direct regulation but as complementary to it. In seeking todeploy the wide range of legal and quasi-legal instrumentsavailable in order to control pollution and enhance theenvironment, policy-makers should identify those strategieswhich would be most effective in influencing behaviour andthe legal status that will best complement those strategies.



52/91

To ensure transparency and openness, we recommended thatself-regulation and use of economic instruments should takeplace within the framework of clear published targets forenvironmental quality, set by government after taking intoaccount all relevant considerations, and with the wideparticipation of all relevant interests.

We suggested that use of a combination of approaches in settingand implementing environmental standards i.e. direct regulation,economic instruments and self-regulation was the best way offurthering general adoption of clean technology, whilst not puttingat risk compliance with numerical standards set to protect humanbeings and the natural environment against specific hazards.



53/91

Articulating values

Values are an essential element in decisions about environmental

policies and standards. Peoples environmental and social values

are the outcome of informed reflection and debate. To ensure that

such values are articulated and taken into account, less familiar

approaches need to be used to extend and complement present

procedures for consultation and participation.

Introduction

We come now to one of the key sections of the StandardsReport, in which we addressed how peoples values should bearticulated and taken into account in the policy-making process.To this end, we suggested that relatively new approaches, whichat the time of the report had hardly been tried in the UK, wereneeded alongside existing procedures for public participation

and consultation.

We explained that by values we meant beliefs, either individualor social, about what is important in life, and in turn about theends or objectives which should govern and shape publicpolicies. Once formed, such beliefs may be durable. It is alsocharacteristic that they may be both formed and modified as aresult of information and reflection. Environmental

Documents

Environmental Standards and Public Values