Volume 15: Government and Public Administration
5. Risk analysis: an analytical approach to policy-making
The development of risk analysis in government

5.18 Government was interested in risk for a number of reasons:

1. traditional investment appraisal (for example, of new transport schemes and industrial sites);
2. assessing the need for regulation (for example, in respect of workplace safety, air and water quality, the handling of solid wastes and toxic substances, and food safety); and
3. assessing the effectiveness of enforcement.

5.19 The Risk Analysis Timeline in Annex 2 gives an idea of how thinking developed from the mid-1980s, and what guidance was available to policy-makers if they looked for it. There were two broad trends:

1. A growing recognition that the principles behind quantitative techniques for comparing costed projects could also provide a useful framework for thinking about options and problems that could not be costed or in which there were uncertainties. Successive editions of the Treasury Green Book ¹ increasingly addressed the issues of risk, uncertainty, elements that could not be valued in money terms, and equity. Guidance issued in 1991 by the then Department of the Environment ² was explicitly about appraising policy rather than capital investment proposals. However, in 1987, when MAFF officials were first considering the implications of BSE, such guidance was not readily available.
2. A move away from an approach based on trying to persuade the public that they should accept the 'scientific' or 'correct' answer, and towards trying to understand the values which individuals brought to decisions about risk. By 1996, Treasury advice on The Setting of Safety Standards explicitly recognised the place of ethical assumptions about the distribution of risks and benefits, and the importance of how the public perceived the 'quality' (nature) of risks. ³ But the fact that public perception of risks was often at variance with the scientific evidence was familiar within Whitehall long before then. For example, this discrepancy was discussed in a Health and Safety Executive (HSE) document in 1987, ⁴ and in the 1990 MAFF paper on risk assessment quoted earlier. ⁵