Companies have to pay HSE inspectors’ fees of up to £124-an-hour if they are found to be breaking safety laws.

The scheme has been running since October 2012 and has raised more than £5.5m in fines across all industries.

Concerns over the initiative were raised in the first triennial review of the HSE overseen by Martin Temple, chairman of the Engineering Employers Federation.

His report states: “A significant number of comments raised concern over the introduction of the Fee for Intervention regime and that this is having a negative effect on the relationship between HSE Inspectors and the businesses they inspect.

“In particular, the perception is that HSE Inspectors will no longer fulfill the function of providing advice to the businesses they inspect.”

Union Prospect deputy general secretary Garry Graham said: “The review rightly raises concerns about the new ‘fee for intervention’ (FFI) model, which links the regulator’s funding to its income from ‘fines’, calling it a ‘dangerous’ model that has potentially damaged the HSE’s reputation for acting impartially and independently.

“FFI was rushed in to fill gaps in HSE’s budget caused by government cuts. Prospect warned that the proposals would be perceived as a business burden and risked damaging the regulatory balance.

“We have been proved right. We strongly back the review’s call to remove the link between funding and fines. It is the wrong solution to funding. HSE has lost experienced inspectors because of the cuts and difficulties caused by FFI.”