What risk?

This edition of Consumer Policy Review deals

The way that risk is handled - including the way that it is assessed, managed and communicated goes to the heart of broader public policy debates. These include difficult decisions about the level of regulation that is appropriate and the role that government should play in people's lives. Decisions may involve balancing the key consumer principles of consumer choice versus consumer safety, restricting individual choice in order to protect the wider public, and determining what level of action is precautionary, while at the same time proportionate. Ultimately, debates about risk are about what kind of society we want to live in.

Much of the work that Which? does is related to risk, trying to ensure that national and international government policy fits with consumer expectations and needs. In recent years, the debates around risk have developed a new type of sophistication. Mishandling and mismanagement of key issues, including food risks such as Bovine Spongiform Encephalopathy (BSE) and genetically modified (GM) foods; financial risks such as pension and mortgage provision; and health risks, such as the long-term safety of some medicines or the competence of some professionals have demanded a fundamental re-examination by both the government and the private sector.

BSE, more than any other issue, highlighted the danger of making false assumptions and reassurances about safety, and an over-reliance on limited scientific evidence. It also highlighted the fact that the consequences of inadequate risk management may not be seen for many years to come. Greater emphasis has therefore been given to the need to adopt a precautionary approach, including greater openness, transparency and consumer involvement. Our campaign for the establishment of a new Food Standards Agency (FSA) aimed to put these principles at the heart of policy-making and, to a large extent, it has been successful. These core principles have not, however, been so readily adopted by other regulators.

Five years on from the establishment of the FSA, debates around the need for deregulation and the Prime Minister's commitment to 'roll back the tide of regulation'1 are also in danger of undermining what has been achieved. Rather than responding to short-term political pressures, it is essential that we develop a more robust framework for effective risk management, where risk communication is central. Consumer concerns should be fundamental to the way that we frame risk. A re-examination of the mechanisms for effective public engagement, dialogue and therefore a better understanding of how consumers understand and perceive different risks is called for.

Geoffrey Podger, in our first article, gives us an insight into the early challenges he faced as the first Chief Executive of the FSA, and then as the first Executive Director of the European Food Safety Authority (EFSA). He explains how BSE prompted a re-examination of risk analysis, including the way that scientific advice was provided, leading to much greater openness and ultimately, greater credibility. He highlights how important it is to hold policy discussions in public, involve a cross-section of stakeholders in policy development and stresses the importance of openly communicating risks to the public. Going forward, he draws attention to the challenges posed when risk assessment and management are dealt with by different bodies and to the broader issue of accountability of the new agencies that have been created - although he concludes that the reforms should ultimately strengthen the role of democratic institutions in food policy-making.

Sue Mayer, Director of Genewatch UK, picks up on the specific issue of GM foods and how we regulate the risks posed by new technologies. She argues that the current approach differs significantly from the way that the public evaluates risks as there is no broader contextualisation including for example, the wider effects on food security, farming practices or consideration of potential benefits. An approach based merely on trying to educate the public about the risk is an insufficient response to GM and other scientific controversies. Instead she reinforces the need for much greater public engagement in decision-making, drawing on her experience as a member of the stakeholder advisory group, the Agriculture and Environment Biotechnology Commission (AEBC), which was recently disbanded.

We then have two articles focusing on risk communication. Irish Langdon, Deputy Parliamentary and Health Service Ombudsman shares her experience of establishing a good practice guide for cardiac surgery teams to use when trying to explain the level of risk, and strengthen the role of patient consent. She also recognises the subjective nature of risk and the way that our perceptions are shaped by many factors including our previous experiences and cultural framing. The development of the guide aimed to ensure that the patient is at the centre of the process.

In our final article we have Alan Goodman, Chairman of the Actuarial Profession's Financial Consumer Support committee, who, in contrast, approaches the issue of risk in financial services from the point of view that consumers can be pushed into behaviour that will maximise their welfare. He explains how the actuarial profession has tried to gain a better understanding of the mismatches between the way consumers understand risk, their attitude to risk and the financial decisions that are ultimately made. He argues that people need to be given specific rules and simple heuristics on how to behave rationally in situations where financial choices are made, as improving financial literacy alone will not provide a solution.