Managing risks to the public: appraisal guidance
HM Treasury - draft for consultation 2004
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Introduction
Principles
Intervention rationale
Assessing public concern
Creating intervention options
Precautionary action
Limits to Government intervention
Appraising costs and benfits
Public involvement
Developing options into solutions
Implementing solutions
Public concern assessment tool

 

This guidance is designed to help decision makers address the risks that the public faces, and also its perceptions of risk. Government has a role to protect and assure the public, which includes taking cost effective action to reduce risk, and to provide accurate and timely information about risk.

One objective of this guidance is to achieve greater consistency and transparency in government decision-making. It aims to achieve this by recommending greater use of evidenced based values of preventing fatalities, and other harms, and supports further studies to inform our understanding of the appropriate economic values to use given differences in context.

This guidance also recommends that, alongside the economic analysis of options available to reduce risk, decision makers should take explicit steps to involve the public: to understand what they are concerned about and why, and to communicate good information about risk, targeted to the needs of the audiences involved.

The guidance also contains a tool (see Appendix A) to help structure and make explicit the evaluation of concerns that may exist about risks of fatality and harm, which is a strand of decision-making where there is currently little extant cross-government guidance.

1.4 The Principles of Managing Risks to the Public:

  • Openness and transparency - Government will be open and transparent about its understanding of the nature of risks to the public and about the process it is following in handling them;
  • Involvement - Government will seek wide involvement of those concerned in the decision process;
  • Proportionality and Consistency - Government will act proportionately and consistently in dealing with risks to the public;
  • Evidence - Government will seek to base decisions on all relevant evidence;
  • Responsibility - Government will seek to allocate responsibility for managing risks to those best placed to control them.

2 Rationale for Government intervention

The first stages of the policy development process involve:

  • Understanding why government is required to intervene. It may appear to the policy maker self-evident why government action is required. However, in practice it is not always obvious. Understanding the fundamental reasons for intervention can later help to direct the policy response.
  • Assessing the level of risk and the nature of the hazard. If government is justified in taking action, the next step is to understand the degree of risk and scale of the hazard that needs to be addressed. This will often involve expert assessments of the scientific and medical evidence.
  • Assessing the level of public concern. Government has a role to reassure the public, to respond where public concerns are legitimate, and, in certain cases, to raise the profile of little understood or appreciated risks. Understanding why the public might be or is concerned can help frame the problem and direct the policy response. Frequently a key issue is the lack of effective communication. Building a two-way communication with the public from the start is vital to improve understanding of risks, and consequently the trust and acceptance of government actions.

3.1 If government action is justified, an expert risk assessment should be carried out. Such an assessment will generally require the exercise of judgement, in structuring the analysis, evaluating relevant data, conducting sensitivity analysis etc, and important judgements and assumptions should be explicitly stated.

3.2 Although assessment methods are specific to the nature of the risk being examined, a robust assessment should generally include the following stages:
- Hazard identification – where the hazard being examined is defined;
- Risk characterisation – where the potential effects of the hazard are identified;
- Risk estimation – where the probability and magnitude of effects are estimated;
- Risk evaluation – where the importance of the estimated risk is evaluated.

3.3 Risk assessments should also include an analysis of potential uncertainty surrounding the risk estimate, which may be substantial if risks are unpredictable or evidence is weak. Where uncertainty is very high there may be need to consider precautionary action (see section 4.10).

Assessing public concern [see Appendix A below]
3.5 Public, non-expert or lay perceptions of risk can differ greatly to those of experts because:
- They may have a different understanding of the nature and magnitude of the risk (and which may be less well informed);
- They have different and diverse views about the acceptability of risks, particularly if they are likely to suffer because of them.
3.6 Involving lay stakeholders in the decision-making process can assist the creation of policy choices and greatly improve the public’s acceptance of policy choices that affect them. It is therefore appropriate that their concerns are evaluated carefully.
3.7 Familiarity and experience of the risk
– in general, people are more concerned about risks which are new to them and about which they have only a little knowledge or experience.
3.9 Some concerns will be valid; others will be unsubstantiated by the scientific, or other, evidence; still others will be generated by uncertainties about which there is little evidence either way. It is important that understanding, reconciling and (where possible) resolving these different viewpoints should be an explicit objective, which is likely to require involving the public.

Creating options
4.1 Options should be created and appraised to help develop responses that meet the objectives and targets established. The Green Book provides advice on option appraisal, and the techniques that should be used, in terms of assessing option costs and benefits, both monetary and non-monetary.

Precautionary action
4.10 If ... the risks and hazards are currently unknown or the uncertainty about their likelihood and/or consequences is very high, but there is a potential for devastating impact, more limiting action may need to be taken (e.g. reflecting the precautionary principle) – to prevent the worst conceivable outcomes from having the chance to develop. Normally, precautionary approaches should be adopted alongside research and monitoring. Consequently, highly restrictive or expensive precautionary interventions should be reviewed on a regular basis in the light of research findings and new data.

Limits to government intervention
4.23
Policy makers should also be aware of the limits to government intervention. The paragraphs in this section are adapted from Securing Good Health for the Whole Population, Derek Wanless (February 2004).
4.24
Interventions to reduce risk have the potential to significantly reduce personal freedoms. This is most clear when government acts explicitly to prevent or restrict individuals from behaving in certain ways, or from consuming particular goods. Of course the impact will not inevitably be restrictive - providing people with information that they can use to protect themselves can increase personal freedom.
4.25
In general, if the freedom to be curtailed or limited is a significant one and valued highly by the individual, the state would need strong reasons to impose its will over the individual on public health or safety grounds. Usually, there should at least be a strong consensus that the measure is necessary to prevent harm to others. Government can of course legitimately intervene when one person’s freedom to act would infringe others’ human rights – for example, a person with a highly infectious disease may need to be quarantined without consent. In other cases, however, the mere fact of social or professional consensus may not provide sufficient justification for action.
4.26
Ideally, individual consent provides the strongest foundation for government action. However, in cases where it is only the individual’s health and safety that is at issue, the question of intervention without consent poses challenges. Nevertheless, there are examples where such measures have been enacted and have become accepted. First, individuals may already prefer not to be free to choose, and may accept restrictions (the banning of class A drugs, for example). Second, they may come to accept the reasons behind the restrictions and no longer see them as an imposition (legislation to require people to wear front seat safety belts, for instance). However, it is important to recognise that measures should be justifiable in the public interest and to individuals as a reasonable restriction of their freedom.

Appraising cost and benefits
5.1 Once a range of options has been created, they should be assessed by estimating their costs and benefits, and/or by their cost effectiveness. The Green Book provides more guidance on how proposals should be costed and adjusted (for instance, for optimism bias).
5.4 A basic principle in cost benefit analysis is that benefits should be valued wherever feasible, to ensure comparison with costs.

Involving the public
6.1 Involving the public is an important part of the policy development process. It is vital to understand how the public perceives issues and whether or not they are particularly concerned:
- Government, including elected politicians and their officials, is entrusted to manage risks to the public. This is one of its core roles and it is responsible to take into account the public’s views;
- ... more time and effort is required to communicate in ways that people can understand, to enable them to make informed choices and to enable them to trust those managing risks on their behalf;
- The public can reasonably expect to be consulted, and to have the chance to challenge ‘expert opinion’, not least because experts can sometimes be wrong, be at variance with each other and be concerned with issues which differ from the public’s concerns;
- The views of government and society can be changed for the better by good two-way communication – it is wrong to think that people’s views do not change and cannot be influenced; similarly, policies are more likely to be refined and improved through consulting the public.

Developing options into solutions
7.1 More widespread use of evidence-based values would lead to greater consistency in decision making, increasing (in certain areas) risk management activity, and preventing or curbing it in areas where the benefits are not justified by the costs.

Implementing policy
7.6 the specifics of managing public health and safety risks will involve in particular: The need for clear communication strategies (see Chapter 5); Monitoring of costs, risks and hazards, particularly where highly interventionist action has taken place, or where the evidence base is weak; and Continuing to listen to minority positions and being open to the possibility of adapting or changing responses in the light of new evidence.

 

Appendix A: Concern assessment tool

This Appendix sets out a framework for understanding people’s concerns in order that they can be considered in policy development and in the development of related consultation arrangements and communication strategies. A good understanding of relevant concerns is necessary for developing an effective risk management strategy although the effort expended should be proportionate to the risk in question. The information gained on relevant concerns should inform and assist the development and selection of policy options and the development of the associated communications strategy. For example, a public information programme can be implemented if it is discovered that public concern stems from a lack of understanding about the risk. Being responsive to public concerns and involving the public in decision-making, helps to improve the accountability and transparency of risk management.

Understanding the framework
The framework is based on the psychometric model of risk perception developed by Fischoff, Slovic and others, in which characteristics of a risk are correlated with its acceptance. For example, risks that are undertaken voluntarily are generally considered more acceptable than risks that are imposed without consent. Similarly, risks that cause dreaded forms of harm are also considered to be less acceptable (see Sections 4.24 – 4.28).

The assessment framework is based around six risk characteristics that research suggests are indicators of public concern. As explained earlier (section 3.7) These six indicators were chosen as being reasonably transparent, representative indicators of public concern which, from the available ‘psychometric paradigm’ research would correlate well with almost any other set that is likely to be proposed. A background note by Baruch Fischoff can be found at http://greenbook.treasury.gov.uk/documents/Fischhoff_Background.pdf

Two of the characteristics relate to the nature of the hazard (Awareness and Experience; and Understanding), two relate to the risk’s consequences (Fear or Dread and Equity) and two relate to risk management (Control and Trust). Research indicates that each characteristic is correlated with concern so, for example, risks that are perceived to be highly uncontrollable would be expected to associate with a high level of concern. By collecting evidence about these indicators, the framework can help understand the likely nature and strength of concern and its drivers.

Collecting evidence
Each indicator should be scored on a 5-point scale by reviewing relevant evidence. For example, two pieces of evidence to score the first indicator (Awareness and Experience) are:
How familiar are people with the hazard?What is the extent of their experience? For each piece of evidence a number of bulleted questions act as prompts to explore related issues. For example, the first piece of evidence under ‘Familiarity and Experience (How aware are people of the hazard?)’ has 3 prompt questions:
- How familiar is the public with the hazard?
- Are all sections of society familiar, or is familiarity confined to specific groups?
- Are those exposed to risk familiar with it?
These prompts are intended to give an indication of the range of issues that should be explored to collect enough relevant evidence to come to a decision on the extent of concern and not as literal questions to be asked (e.g. as a questionnaire). They are indicative and not prescriptive or exhaustive lists. Having reviewed these prompt questions, a summary of the evidence should be entered in the scoring table.

Scoring indicators
Once all the evidence has been collected, it should be considered as a whole to score the indicator on a 5-point scale, where Level 1 is associated with the lowest level of concern and Level 5 with the highest. The specific score should be taken as indicative rather than a determinant of a particular action and may be useful in identifying those risks requiring further consideration for action.

Identifying policy responses
Possible policy responses to each indicator should be entered into the scoring table. Suggested policy responses are discussed in Chapter 4, paragraphs 4.16 – 4.22. It is intended that the information on concerns should be used to inform but not constrain decisions on policy developments, options etc. and on consultation and communications strategies.

Using the framework
Measuring and evaluating public concern requires expertise and understanding of risk perception. Use of the framework should be proportionate to the scale of the policy initiative, the likelihood of high levels of public concern, the potential impact on the policy etc. Tools such as the Risk management ladder developed by Ortwin Renn may assist with this.
http://greenbook.treasury.gov.uk/documents/riskmanagementladder.pdf

General principles
The framework provides a structure for organising and evaluating evidence of actual or potential public concern but is not prescriptive about the methods by which such evidence should be collected. However, it is intended that the framework be used primarily as a guide for a facilitator to explore public concerns (e.g. through workshops or interviews) rather than be used as a questionnaire to elicit views directly.

In addition to evaluating evidence using the framework structure, facilitators should also ask the public about their overall level of concern about a risk to check that the framework’s output is reasonable. It is recommended that this be asked both before and after using the framework, as respondents may change their opinion after exploring the issue in detail. It may also be helpful to ask if there are any other important drivers of concern not already considered in the framework. For example, people may be concerned simply because friends or family are concerned.