PACC Committee Meeting

STANDING COMMITTEE ON PUBLIC ACCOUNTS

COMITÉ PERMANENT DES COMPTES PUBLICS

EVIDENCE

[Recorded by Electronic Apparatus]

Thursday, May 31, 2001

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[English]

The Vice-Chair (Ms. Marlene Jennings (Notre-Dame-de-Grâce—Lachine, Lib.)): I'd like to call this meeting to order.

[Translation]

Pursuant to Standing Order 108(3), we will now begin our consideration of Chapter 26 of the December 2000 Report of the Auditor General of Canada: Health Canada - Regulatory Regime of Biologics, and of Chapter 27 of the same report: Canadian Nuclear Safety Commission - Power Reactor Regulations.

[English]

Before I ask our witnesses to make their statements, I would like to introduce a delegation of Russian parliamentarians and officials: Mr. Valeriy Galchenko, chair of the Duma's subcommittee on relations with the Accounting Chamber; Mr. Aleksandr Leonovich Kushnar, who is the auditor; Mr. Yulii Ivanovich Savinov; Mr. Aleksandr Ivanovich Nozdrachev; Mr. Tatyana Nikolayevna Drozdova; and Mr. Oleg Anvarovich Dzhurayev. If I'm not pronouncing your names properly, I do apologize.

Welcome. I hope that your observation of this meeting will be of assistance to you. We look forward to having an informal meeting with you tomorrow.

Now I will introduce our witnesses: from Health Canada, Dr. Robert Peterson, director general, Therapeutic Products Directorate, and acting director general, Biologics and Genetic Therapies Directorate, Health Products and Foods Branch; Jean Peart, senior adviser, Quality Systems, Biologics and Genetic Therapies Directorate, Health Products and Foods Branch. From the Canadian Nuclear Safety Commission we have Linda J. Keen, president and chief executive officer; Mike Taylor, executive director, Office of Regulatory Affairs; Susan Clyne, director, Human Resources Division. Finally, from the Office of the Auditor General of Canada we have Sheila Fraser, Interim Auditor General of Canada; Crystal Pace, principal, Audit Operations Branch; and Ronald Campbell, principal, Audit Operations Branch.

We'll begin with you, Ms. Fraser.

Ms. Sheila Fraser (Interim Auditor General of Canada): Thank you, Madam Chair.

We thank you for the opportunity to present the results of our audit on biologics as reported in chapter 26 and our audit on power reactor regulation reported in chapter 27.

As you mentioned, with me today are Ronnie Campbell, who was responsible for the audit on biologics, and Crystal Pace, who was responsible for the audit on power reactor regulation.

These two chapters were part of a set of five audits on federal health and safety regulatory programs reported in our December 2000 report. Chapter 24 presented the results of a decade of audits of federal regulatory programs and our principal concerns.

In summary, we recommended that the government, first of all, explain to Canadians its priorities and the balance it has struck between protecting Canadians and addressing budget and economic objectives; ensure that reliable information on risk is available and that this information is used to determine priorities; allocate sufficient resources based on risk; and, finally, report annually to Parliament on the overall effectiveness of health and safety regulatory programs that require significant interdepartmental cooperation to work.

[Translation]

I will now present the key results of these two audits. Each audit addresses different aspects of our broader findings and each organization operates in quite different regulatory environments.

We found that Health Canada is taking a reasonable approach to developing and implementing frameworks and approaches for regulating different biologics. The responsible bureau works closely with others, both internally and externally. It maintains expert advisory committees, allowing it to be proactive, where necessary, in its interventions.

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However, while the Department has recognized that a variety of approaches are necessary to deal with a wide spectrum of risks, it has not developed the necessary guidance to help its officials decide on the most appropriate approach for a given situation.

Health Canada acknowledges that the Food and Drug Act and regulations have not kept pace with scientific and technological advances, and has begun to implement approaches based on standards, which it hopes will offer greater flexibility.

Under this concept, standards can be developed by recognized standards development organizations or professional bodies and can be referenced in regulations. The government remains accountable for the effectiveness of the regulatory regime.

Lessons learned from using this concept should be applied to future standards-based regimes as appropriate.

The Department has had difficulty in staffing important scientific positions. In addition, it has had difficulty in implementing sufficient databases to adequately process, analyze and disseminate information on adverse reactions and events.

[English]

I will now turn to the audit of power reactor regulation. The Canadian Nuclear Safety Commission reviews operations of power reactors on a continuous basis. Commission staff at each power reactor site, along with specialists from Ottawa, monitor compliance with regulations and licence conditions. Nevertheless, our audit found that improvements were needed to ensure that the commission continues to protect the health and safety of Canadians.

First, the commission's regulatory approach relies on the competence and professional judgment of knowledgeable staff. This pool of expertise will begin to disappear as staff retires. At the time of our audit there were a number of lengthy vacancies in important positions. As a separate employer, the commission has the flexibility to better manage its human resources.

We found that the commission also needs to improve its review process for power reactors by using a risk-based approach that incorporates quantitative measures of performance. In addition the assessment of performance as acceptable, conditionally acceptable, or unacceptable needs further elaboration so that the commission licensees and the public have a clear understanding of both the adequacy of safety performance and what needs to be done to improve it.

Also, the commission has not completed key regulatory documents, particularly for the compliance regime. Given the shortages and expected turnover of staff, it is particularly important that the regulatory regime be clear and well understood.

Both Health Canada and the commission were responsive to our report. In addition the commission has posted a more detailed action plan on its website, which when implemented should address our concerns.

Madam Chair, this concludes our opening statement. We would be pleased to answer any questions the committee might have.

The Vice-Chair (Ms. Marlene Jennings): Thank you.

Dr. Peterson.

Dr. Robert Peterson (Director General, Therapeutic Products Directorate and Acting Director General, Biologics and Genetic Therapies Directorate, Health Products and Foods Branch, Health Canada): Madam Chair, members, thank you for the opportunity to appear before you today.

Health Canada is responsible for regulating biologics. The term biologics includes blood and blood products, cells, tissues, organs of human or animal origin, vaccines, hormones, products used in the management of allergies, recombinant DNA products, as well as other biologic drugs. These are all leading-edge technologies.

In July 2000 the realignment of Health Canada became effective. The purpose of this was to strengthen our scientific, policy, regulatory, and management capacity to protect and promote the health of Canadians. The realignment included the creation of a new directorate, the Biologics and Genetic Therapies Directorate, in order to focus resources and efforts in this area.

As of April 1, 2001, we have put a new organization in place, and we will continue to build on it as new staff are hired. In particular we are currently recruiting a candidate to fill the director general's position. The new directorate will bring together staff in Health Canada who have expertise in the very specialized field of biologics. With a product life-cycle approach to biologic products, they will be able to build on their knowledge and experience of these products to ensure knowledge continuity.

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The Auditor General noted that Health Canada's approach to regulation of biologics is evolving. Traditional regulations tend to be prescriptive; that is, specific standards are included in the regulations. A more flexible approach is to reference in our regulations standards established either by government or by third parties. This standards-based approach allows us to respond more quickly to new knowledge or technical advancements.

The rapid advances in the area of biologics require that we have knowledgeable staff who can evaluate and test new products, monitor their effects, and ensure compliance with regulations. Our staff must be able to stay abreast of new developments and thus sustain a proactive, effective risk management strategy.

The Auditor General recommends that we augment our staffing efforts, and this we have started to do. We have also sought and received funding to fill vacancies for drug submission reviewers. The demand for qualified workers in biologics is acute, not only in public but also in private sectors. We therefore must compete, and compete aggressively, with universities as well as industry for the knowledge workers we need.

Teams of human resource officers, departmental scientists, and managers are working together today on staffing. They are coordinating their efforts to ensure effective recruitment and training strategies. Through a variety of programs, we are also enhancing training opportunities for staff so that they may keep abreast of new developments and maintain their competency in the jobs they are required to do.

Our staff carefully assesses new drugs and devices before they are launched into the marketplace. Afterwards, we monitor how these products are working through our surveillance and inspection programs. The Auditor General sees room for improvement in this area. The report recommends that we implement databases to adequately process, analyse, and disseminate information on adverse reactions and events.

Over the past two years we have done much to enhance our surveillance system. In the future we'll also partner with the United States FTA to strengthen our surveillance capabilities. This initiative will be a combined database containing both the United States as well as Canadian adverse event reports. Canadians will be better served by having access to thus a much larger database, providing information on rare but relevant and important critical adverse reactions.

Madam Chairman, through these and other efforts, Health Canada intends to establish a regulatory regime for biologics second to none in the world. Our regulatory tools will be relevant and flexible. They will keep pace with technological advancements as much as possible. They will help ensure that biological products adhere to the highest standards and improve the quality of life for Canadians.

We commend the Auditor General on the excellent work she has done in this audit.

Thank you.

The Vice-Chair (Ms. Marlene Jennings): Thank you, Dr. Peterson.

Ms. Keen.

Ms. Linda J. Keen (President and Chief Executive Officer, Canadian Nuclear Safety Commission): Good afternoon, Madam Chair, members. Thank you very much for your invitation to meet with you today.

[Translation]

I would be happy to answer your questions concerning the Canadian Nuclear Safety Commission's response to the Auditor General's recent report. Today is in fact a special day for the Commission. Exactly one year ago, on May 31, 2000, the Commission came into being with the passage of the Nuclear Safety and Control Act.

[English]

I was appointed president and CEO of the commission on January 1, 2001. I'm committed to responding appropriately to the Auditor General's findings.

First, I should talk about the current state of the CNSC, which is the acronym for the commission, and the environment in which we regulate.

[Translation]

Our mandate is to regulate the use of nuclear energy and materials to protect health, safety, security and the environment and to respect Canada's international commitments on the peaceful use of nuclear energy.

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[English]

All this boils down to job one to CNSC, which is safety. For 50 years the CNSC and its predecessor, the Atomic Energy Control Board, have had a well-deserved reputation, nationally and internationally, as a competent and fair nuclear regulator. On the international stage we are seen as a very transparent regulatory body with a long history of public meetings and public consultations on regulatory activities and proposed standards. However, over the last few years Canadian society's expectations of its regulators, for greater transparency and accountability, have changed. We recognize that the Canadian public has very high expectations in this area. We must provide Canadians with the assurance that we are effective and efficient and that the industry we regulate is also being held accountable for the health and safety of the public and workers and the protection of the environment.

As the Auditor General has pointed out, there are areas for improvement. At the time of the release of the Auditor General's report, as the Auditor General has noted, we filed an action plan, which is publicly available on our website. Our actions will be completed in a timely and accountable manner. In fact, the executive committee of the commission is reviewing our commitments and seeking, wherever practical, to move up some timeframes. We are applying the lessons learned from the Auditor General's report to all areas of licensing, not just reactor regulation.

I should point out that while about half of the CNSC's operations concern the regulation of Canada's nuclear power reactor industry, we have a much larger group of licensees than power reactor operators alone. The CNSC is responsible for approximately 4,500 licences in every province and territory in Canada, covering everything from uranium mining to hospital use of radioactive materials. The CNSC recognizes it must demonstrate to licensees and other stakeholders that it conducts itself both effectively and efficiently. Risk management is a key factor in ensuring good performance in both these areas. The articulation of risk in a manner that provides fair and balanced technical and societal concerns is a challenge, which we are actively addressing.

The CNSC is not alone in finding it difficult to clearly articulate various aspects of risk, and we are working on this issue with nuclear regulators around the world.

[Translation]

In response to the Auditor General, the CNSC is improving its system of rating the safety of nuclear power plants and integrating the new rating system with a risk-based approach to planning and resource allocations. This will be fully complete by March 2003.

[English]

We are accelerating the production of regulatory documents needed to communicate the CNSC's regulatory expectations to licensees, staff, and the public. I am pleased to inform you that in our first year as the commission, we have published 22 regulatory documents, either for comment or in final form. This compares to 18 documents over the previous 10 years before that. However, we acknowledge that we must increase the rate of production while ensuring documents remain of high quality and are fully available for stakeholder input.

To reinforce my commitment to this important part of our work, I have recently created the office of regulatory affairs and asked Mike Taylor to lend his expertise to these important areas. I am confident that Mike's many years of diverse experience as a nuclear regulator will help us to achieve the regulatory standards expected by Canadians.

The Auditor General noted that the CNSC faces unique human resource challenges. We recognize the challenges to the CNSC of maintaining a competent workforce. This challenge is shared by other Canadian science-based organizations, our licensees, and nuclear regulators around the world. The CNSC is experiencing staff shortages due to our inability to meet private sector salaries, an aging workforce, a limited pool of qualified recruits, and limited funding to aggressively redress these problems rapidly. The CNSC currently has several initiatives in place, and we are continuing to explore methods to address our human resource challenges.

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[Translation]

We were recently successful in obtaining funding from Treasury Board to address some of the compensation issues.

[English]

These funds will help correct certain salary issues.

[Translation]

For example, we have now introduced retention bonuses for key engineering and scientific positions.

[English]

We are implementing succession planning at all levels of management and will build on the extensive work in human resource management that has been carried out over the last two years.

[Translation]

I am committed to seeking and implementing partnerships with academia and industry to support strengthening of nuclear education programs. We have also implemented a pilot internship program in order to help maintain our capability to regulate power reactors, and are very pleased with the response. This year we have selected eight interns.

[English]

When they have successfully completed the program, we will be offering these interns full-time positions at the CNSC.

Implementation of these initiatives, while keeping an eye on our daily operations to ensure that we fulfil our mandate, will be a significant step towards CNSC addressing the recommendations of the Auditor General and becoming one of the best nuclear regulators in the world.

Thank you for inviting me today. I'd be pleased to answer your questions.

[Translation]

Thank you very much.

[English]

The Vice-Chair (Ms. Marlene Jennings): Thank you, Ms. Keen.

[Translation]

We will now move to the first round of questions during which each member will have eight minutes. We'll begin with you, Mr. Mayfield. All I ask is that if your question is directed to one person in particular, please identify that individual. If your question is directed to all of the witnesses, then please specify that as well. If anyone wishes to make a comment, kindly motion to the Chair so that you can be recognized.

[English]

Mr. Mayfield.

Mr. Philip Mayfield (Cariboo—Chilcotin, Canadian Alliance): Thank you very much, Madam Chair.

I'd like to welcome once again the Acting Auditor General and the witnesses who are here. It strikes me that the witnesses come from departments where there is great interest because of the demand for the services that you regulate.

I don't really want to direct a question to an individual person, because you'll know who's best qualified to answer. But from the nuclear safety folks, I want to know the current status of your commission's compliance and enforcement implementation program.

I guess the reason I ask that question first is because the Bruce reactor is in the news these days, and there's some thought that it will run out of its projected life of useful service before it's upgraded. How are you people involved in that? What is the involvement of your program in enforcing the regulations there?

Ms. Linda Keen: In answering the question, I'd like to make a couple of general remarks and then talk about Bruce.

Specifically, the responsibility of the commission, as a regulator, is to ensure that all the various reactors are compliant with the regulations that are put forward by the commission. So it involves a licensing process, but also a process by which, in the case of the regulators, we ensure we have staff on site to ensure they comply on a daily basis with the regulations we've put forward in terms of safety.

So we have an overarching responsibility. There is not a reactor in Canada that operates without a licence from the commission. That's our overall responsibility.

Specifically on Bruce, we were just—

Mr. Philip Mayfield: I don't want to interrupt you, but I'd like to clarify before we go on: Are you responsible not only for the operation, but for the technical capability, the safety of the equipment? Is that under your jurisdiction as well?

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Ms. Linda Keen: First of all, in terms of the overall operation, it is a licensee who is accountable and responsible for the operation of the facility. That is to be established first. We are responsible, as a regulator, for establishing the conditions and monitoring the compliance of the company with the set of regulations. So they maintain overall accountability and responsibility to begin with.

But, yes, we're responsible for a set of regulations under which the reactor can operate. These cover a gamut of regulations, from looking at equipment, but also looking at human performance factors, because more and more, when we do lessons learned in terms of issues that face power reactors and a number of different types of licensees across the country, it's the human performance that makes the difference in how these reactors perform.

Mr. Taylor, do you want to make any specific remarks?

Mr. Mike Taylor (Executive Director, Office of Regulatory Affairs, Canadian Nuclear Safety Commission): As President Keen has said, there are rules at various levels. One could call the first of the two activities that we're doing “licensing”, where the commission issues licences to our reactor operators for a fixed period of time, and in a sense, that is setting the rules.

So the rules consist of: the act, at a very high level, passed by Parliament; regulations, which are approved by the Privy Council; the licence itself, which sets quite specific limits and power that the reactor can go to, and things of that sort; a set of standards, which we publish, many of which are referred to in the licence; and guides and other regulatory documents, which we supply.

So there are a whole series of levels of standards. They apply to maintenance of the plant, how many people need to be there all the time, a whole gamut of safety-related activities.

Mr. Philip Mayfield: One of the things you may not know is that Madam Chair has a clock ticking here—

The Vice-Chair (Ms. Marlene Jennings): And you have three minutes.

Mr. Philip Mayfield: —and I have three minutes out of my eight minutes left.

Mr. Mike Taylor: I apologize.

Mr. Philip Mayfield: So we're going to cut to the chase, if we can.

Mr. Mike Taylor: Thank you.

Mr. Philip Mayfield: What I would like to know is this: When people watch on television about the Bruce reactor—and it could be any other—they want to know, since they're living in the neighbourhood, how safe is it? Are you in a position to tell them that it's safe or not and why? Are you in a position to demand that the upgrading take place before perhaps the operator is prepared to do that? How do the people who need to know about their safety get the information they need to make that judgment accurately, and what is your involvement in that?

Mr. Mike Taylor: First of all, I would say, yes, they are safe, and the reason we know that is because they comply with all those standards that I spent too long talking about just now.

How does the public know? The commission holds its meetings in public. The commission, in fact, held its meeting about Bruce at the Bruce site only recently, and a large number of people were there to listen to the deliberations. The deliberations were open to all those who wished to intervene.

We publish the related documents. The staff recommendations to the commission are publicly available on our website.

Mr. Philip Mayfield: How do people answer questions like, there's 50 years of storage safety but they're not going to fix it up for another 88 years? How do they know whether those numbers mean anything or not? Are you in a position to answer those questions?

Mr. Mike Taylor: We're not in a position to answer that question, because the policy about where to store material is not within our mandate. Our mandate is to make sure that when somewhere is chosen to store it, it is safe.

Where it is stored now is safe. It meets our requirements, and for the foreseeable period and the lifetime of the current storage, which is 50 years, we are assured that it is safe.

Mr. Philip Mayfield: But what about the other 30 years?

Mr. Mike Taylor: For any time beyond the lifetime, someone will have to do something, and we will not grant a licence—

Mr. Philip Mayfield: Is my time finished?

The Vice-Chair (Ms. Marlene Jennings): You have one minute.

Mr. Philip Mayfield: Okay, sorry.

Mr. Mike Taylor: —we will not grant a licence if we believe it's unsafe.

Mr. Philip Mayfield: Okay, but there's huge public concern about this now, and I want to know what your involvement is in meeting that concern, because, like you and me, we not only have jobs to do with individuals and with the technology; we have a public component to that. What is your responsibility in that?

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Mr. Mike Taylor: Our new act, which Madam Keen referred to, came out last year and specifically gives us a mandate to convey objective information to the public. We are trying to do that through our publications, through our website, where we're publishing as much information as we can, and through this series of public meetings.

Mr. Philip Mayfield: I want to talk to you about the personnel, your problems, but I'll leave those questions until later.

Thank you, Madam Chair.

[Translation]

The Vice-Chair (Ms. Marlene Jennings): Thank you, Mr. Mayfield. You'll have another opportunity during the second round of questions.

[English]

Mr. Shepherd, you'll have eight minutes, questions and responses combined.

Mr. Alex Shepherd (Durham, Lib.): To the Nuclear Safety Commission, you mentioned the issue of the storage of waste. With the advent of reactors now burning MOX fuel, that presumably increases the amount of waste, over and above what we originally budgeted for. What impact could that have on storage within the reactor site?

Ms. Linda Keen: The policy considerations with regard to waste management are not under the auspices of the commission. Natural Resources Canada is responsible for policy decisions and recommendations with regard to waste management in general. As Mr. Taylor said, once a decision has been made to, for example, restart a reactor or to put a reactor in a specific place, it's our responsibility to ensure that provisions are made for waste management and that those waste management sites are within our regulations and safe.

Specifically with regard to MOX fuel, our responsibility during the recent shipments to Chalk River, the only shipments that have been made, was strictly with regard to the regulation of the transport, to ensure that was safely done. We don't issue permits to import MOX fuel per se, again that's Natural Resources Canada.

This question of MOX fuel being burned at Bruce was specifically raised during the recent hearings I conducted up at Kincardine. We made it clear to those interveners who addressed questions to us that a licence change would be required before MOX fuel could come into the site at Bruce. We have no application to do that, and if Bruce Power made a decision to do that, there would be several hurdles to overcome, one within our purview, the granting of a licence. That is not on the table at present.

Mr. Alex Shepherd: Out of interest, not that I want to belabour the issue, although you don't see yourself as taking custody of the waste itself, at what point are you responsible, when you say transportation? Is it when that airplane flies in Canadian air space? How does that work?

Ms. Linda Keen: When any of the materials we regulate are moved in Canada, we are responsible, for example, for the safety of the container. That was one of the issues in the movement of MOX we were very concerned about. We licensed that container and ensured that it met Canadian standards for those security issues. We work with Transport Canada very closely, and it's Transport Canada that has the overall responsibility for the movement, but because we're experts in the movement of nuclear materials, we were the ones who looked at the storage and the movement, the actual container itself, that was our responsibility.

Mr. Alex Shepherd: With the movement toward privatization, especially in the province of Ontario with the advent of Ontario Power Generation, what is the relationship with your agency, compared to the Ontario Power Generation, in the sense of payment for your services? Is there some recognition by Ontario Power Generation to pay for the services of the watchdog sort of thing?

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Ms. Linda Keen: We are cost-recovered. About 77% of our direct licensing activities are cost-recovered from the companies that have either power reactors or non-power reactors, uranium mines, etc. This is ongoing. This includes Ontario Power Generation and their predecessor, Ontario Hydro. This is not changed by the privatization.

In the case of Bruce Power, which is the leasing that has taken place quite recently, Bruce Power now will be submitting funds for cost recovery for the Bruce reactors.

Mr. Alex Shepherd: Getting back to some of your initial concerns, you're unable, for whatever reason, to keep up with salaries of your people who are involved in this compliance, and yet we're only collecting 77¢ on the dollar. Maybe that's part of the problem, is it?

Ms. Linda Keen: The cost-recovery policy of the Government of Canada is very specific about what we can charge for and what we can't. There is a difference between private good and public good. So the rest of the money that is used by the commission that isn't cost recovery are for activities that are considered public good activities, including our international activities for nuclear non-proliferation.

We do acknowledge that we need to update our cost-recovery regime. Since I've come in as president my first request was to do a better job of tracking the work we're doing against the specific dollar value in the tasks in the various areas. We think that within a year we'll be able to come back to Treasury Board with a.... They really gave us permission to change our cost-recovery policy and to augment the fees we have. There's a federal regulatory policy that guides all regulatory agencies that makes sure we don't overcharge, and as well that we're efficient and effective.

So certainly we do cost-recover. One of the areas we will be looking at is are we charging the right fees to the right group? There is a group of licensees that we don't charge, which are the hospitals, for example. That was a policy decision made some years ago that we don't actually charge all of our licensees.

Mr. Alex Shepherd: I'm less concerned about Bruce. My riding is Durham and the reactor is Darlington.

I got involved in the Y2K issue and I discovered that between AECB and the people in Darlington there was only an inventory of equipment that was basically taken on. In other words, if they added a piece of equipment you had knowledge of it, but only through an invoicing system. In other words, there wasn't a physical audit that was done at the time.

I know they went back and did a physical audit, but it seemed odd to me at the time that the safety people did not have an auditing function that audited physical assets. They had this open inventory system. So at the time they couldn't give me assurances that in fact all of the digitized equipment in there was Y2K compliant.

How are you assured that you have proper inventory lists of physical assets within the plant?

Mr. Mike Taylor: What you're discussing is something called “configuration management”. We have required OPG and our other reactor licensees to take a much more proactive approach to configuration management. In fact, OPG was in front of the commission yesterday discussing its program for doing just that. We are satisfied that they are now taking appropriate action to get to the standard of configuration management; that is, knowing what they have there—and they will be there within two years.

With respect to the Y2K problem, you will know that all of the power reactors in Canada performed very well.

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Mr. Alex Shepherd: I was more concerned about the answers I was getting at the time. They were not giving me a lot of reassurance.

Ms. Linda Keen: As Mr. Taylor said, literally yesterday we had a report from OPG on configuration management, and this is an area of compliance where the commission does monitor OPG.

The Vice-Chair (Ms. Marlene Jennings): Thank you, Mr. Shepherd.

Second round, Mr. Mayfield, four minutes.

Mr. Philip Mayfield: Thank you very much.

It is interesting hearing you respond to Mr. Shepherd by saying you can't overcharge any of your clients. In your comments you mentioned that CNSC is experiencing staffing shortages, and then you mentioned that you were successful in obtaining funding from Treasury Board to address some of the compensation issues.

I'm wondering if you could talk about the difficulties with staffing you're having. Is it a highly competitive environment you're working in? My presumption is that, yes, it would be. I'd like to talk about some of the difficulties and what your plans are to overcome those difficulties. With the job you have in your mandate, you have to have the right people to do it. What are your plans for that?

Ms. Linda Keen: Yes, it clearly is one of the biggest challenges I have before me right now. We have a staff complement of just under 500 people, so we're clearly looking at this.

I wish it were as simple as salaries. Clearly, salaries are a problem for us, so we asked Treasury Board for specific dollars to address the salary gap that I identified for scientists and physicists and technical positions on the ground. These are people who were being literally offered bigger salaries; it is not unusual for them to get salary increases of $4,000 to $20,000 and they go. That's what my exit surveys are telling me.

But it's not just salaries. Treasury Board has done a lot to do that. Whether it will be enough in the long run remains to be seen, because the second problem is there's a shortage of qualified people in this area. What happens is then the companies just increase the salaries and I have to go back to Treasury Board for more money, etc. Certainly high salaries in the short run are helping me to stem the tide of losses.

The second issue is that the commission and the industry have to work more closely with universities. Universities in Canada are not graduating students, for example, in engineering, who are the feeder employees for us all. What's happening is there's a shortage of staff and we just compete back and forth for the same employees.

What I have done lately is not only are we cooperating with universities in a program called CANTEACH, but about two weeks ago I entered into an agreement with a number of universities led by McMaster where we're specifically working with them, both with the teachers and to give research grants to these universities to encourage the development of engineers in these universities so we all have more people to recruit from. Ontario Power Generation is doing this too in a number of other places, but it's after years of neglect and these programs are not there.

The third thing is the average age of my employees is 45. The average age of the Public Service Commission is 42, so I'm older. The average age of my directors general, which is the highest level in my organization, is 56. Everyone talks about the baby boomers, but I have baby boomers-plus in my organization.

What's going to happen is I have to do some very quick recruiting, which I'm doing, including by my internship program that I talked about. We have to accelerate the recruitment in to get trained people, because no matter how good the systems we have in place that we've talked about are, you need experienced people too.

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The Vice-Chair (Ms. Marlene Jennings): Mr. Finlay.

Mr. John Finlay (Oxford, Lib.): I don't have any questions at this time, Madam Chair.

The Vice-Chair (Ms. Marlene Jennings): Thank you.

Mr. Shepherd, four minutes.

Mr. Alex Shepherd: You're aware of the concept of a fusion reactor. I am told that the regulatory regime that exists would cover fusion reactors. Is that correct?

Mr. Mike Taylor: Yes.

Mr. Alex Shepherd: Going back to your problem of staffing, you mentioned engineers. I assume the problem is that we're graduating computer engineers and not nuclear engineers. Is that the problem?

Ms. Linda Keen: I think it's a matter of engineers being in demand, period. Across the public service we've offered an allowance to retain engineers in the public service, not just our engineers. We hire an assortment of engineers, including people who have specific nuclear engineering experience, such as from l'École Polytechnique. But there are mechanical engineers as well. We have a broad assortment. We also hire physicists. A lot of the work we do requires nuclear physicists. We also have people who are experts in environmental areas. We have doctors on staff because of the radiation protection issues. So there's a whole range of technical and scientific people who are essential for us.

Mr. Alex Shepherd: You seemed to say initially that it wasn't only money, so there must be some other reason people don't want to come. Their choice is to stay in the private sector.

Ms. Linda Keen: There are two issues. The reason we can't attract them from industry or industry recruits them from us is usually money. But the basic supply is a problem for everybody. In fact, because new nuclear reactors weren't being built and there was a view that the industry was not progressing, many people said it wasn't a career they wanted to enter.

That said, when we went to universities to recruit the interns, we were really surprised by the quality. I think we went to seven universities, and we didn't have a problem with young people coming in. The problem is that they lack experience. We can't put them right on the ground. They really do need a lot of experience before they become inspectors.

Mr. Alex Shepherd: You also talked about qualitative indicators. That's a buzzword around here these days, societal indicators and so forth. What would a qualitative indicator be? What would it look like? What sorts of things would it quantify?

Mr. Mike Taylor: Madam Chair, if I may, we have indicators at various levels. The Auditor General has commented on the broad-brush indicators we're currently using. Both for the overall assessment of our licensees and the major areas in which they operate we have three levels: acceptable, conditionally acceptable, and unacceptable.

We are doing something about that. We will have a better set of indicators that makes it clearer what we mean. So by the end of this year at that level we will have a new system of more precise classification.

We also have 17 reactor performance indicators in all sorts of areas, such as maintenance and chemistry control, because it has a significant effect on how long the pressure-retaining components will last. There are 17 technical areas where we require all of our licensees to report to us, sometimes quarterly, on the trends with these indicators, and we in turn report those to the commission.

The Vice-Chair (Ms. Marlene Jennings): This will be your last question, Mr. Shepherd.

Mr. Alex Shepherd: On the basis of being able to communicate the safety environment to the general public, are they in a format...? I think what the Auditor General is saying is that they're too vague. Presumably, these aren't going to be so precise that the average person isn't going to be able to understand them. Can you give us some kind of indication of what would replace the word “acceptable”? Would it be four or five different classifications?

• 1625

Mr. Mike Taylor: We have in mind about five classifications. They will not only indicate how this performance relates to our standards, which is really what the current one does, but also how important that particular area is in the overall scheme of things.

We use an international scale of the Atomic Energy Agency called a periodic safety review guide. This is internationally recognized as a way in which you assess a power reactor. We use that guide, and we rate each area of that. What we're going to do now is use a more precise measure. We will have it by the end of the year. We also relate those to a colour scheme. We already have a table for all of our reactors. It's published in our annual report on power reactors, which has just been published, and you can see at a glance whether, for example, there are any red areas. I can assure you that when we put a red dot on that table, the president gets an immediate response from the chief executive of the utility concerned.

The Vice-Chair (Ms. Marlene Jennings): Thank you, Mr. Taylor.

Mr. Mayfield, four minutes.

Mr. Philip Mayfield: Thank you.

I want to complete my questioning about the personnel matters. You mentioned that you have 500 people employed with the commission. How many do you need? How short is that complement of being full?

Ms. Linda Keen: A year ago we had 54 vacancies out of the 500. Fifty-four overall is not as critical as how many we had in the power reactor business when the Auditor General looked at that. We had 50 vacancies. We're now down to 39 vacancies in the commission. I wouldn't conclude that the overall complement is incorrect. The number of vacancies within the 500 is the issue. But we've moved down so that now we only have 20 vacancies in the whole power reactor area. We've moved from 29 to 20, so I have hired nine people. It's still of concern to us. We have 26 people on site and three vacancies in the on-site personnel. That's critical for people at Darlington and Bruce. Those are the people who are right on site. So we put the priority on those. It's not the overall number that is the issue, Madam Chair. It's where the vacancies are and what type of talent is involved and making sure we fill the critical ones first, which we consider to be the ones on site.

Mr. Philip Mayfield: Are there other criteria that make it more difficult for you to hire? For example, you hear of retired scientists doing security work or something like that in a mall. I'm thinking about age restrictions and language restrictions. Maybe they speak two languages but they're not the correct languages. Are there other restrictions that keep qualified people from being employed by you?

Ms. Susan Clyne (Director, Human Resources Division, Canadian Nuclear Safety Commission): No, there aren't. In fact, we hire a lot of late career individuals, some of whom come to us from the licensees. In fact, just this year we introduced a change. We weren't recognizing their vacation entitlement, and that was an impediment to them. They would come with six weeks vacation. Now we recognize the bank of vacation they have.

Mr. Philip Mayfield: Sometimes in quiz shows they have short snappers, and there are some details that I think would be helpful to us in writing our report. With regard to the suggestion for a quantifiable rating of safety, you said you'd look at that. Have you done any work on that?

Mr. Mike Taylor: Yes, we have done a lot of work. I promised the president that we will have this work in place by the end of the year. Since I have not had an opportunity to discuss it with the commission, it's still speculative as to what the final form will look like. As I've already mentioned, we believe there will be five classifications instead of three, and they will not only indicate the relevant level against our own standards but also how important the particular area we're looking at is to the overall safety of the plant.

Mr. Philip Mayfield: With regard to performance ratings, I believe the commission is presently reviewing these ratings. Maybe they were done by last fall. Have they been completed?

• 1630

Mr. Mike Taylor: The current ratings for last year have been completed. We have just issued our annual report for all power reactors for last year. We found some areas to be completely acceptable. We've certainly seen an increase in performance over previous years. Overall, we believe the nuclear power industry is getting better, and that is clearly evident from the results of our report.

Mr. Philip Mayfield: With regard to regulatory documents, when can we see the relevant documents fully updated? Do you have an idea about that?

Mr. Mike Taylor: I don't think we can ever be fully updated, because the world is changing all the time.

Mr. Philip Mayfield: But according to your action plan, all key regulatory policies and standards will be in place by March 2003.

Mr. Mike Taylor: Yes, that is correct.

We will have the key basic standards in place by then, but there will always be new issues arising, so I couldn't honestly tell you it will be fully complete. But we will have a very significantly better-documented program by that time.

Mr. Philip Mayfield: You will always be in progress, but what's the status of that initiative now?

Mr. Mike Taylor: We have done a great deal, as Ms. Keen pointed out to you. Over the last couple of years, we've produced significantly more documents than we've produced over the whole of the rest of our history. But we're still a considerable way behind.

I have just taken on this task. We are looking around the world. We've noticed an American scheme for doing things that promises to do it much faster, and we will adopt that. So I am confident we will meet the target date.

Mr. Philip Mayfield: What is the current status of the commission's compliance and enforcement implementation program?

Mr. Mike Taylor: We always have had compliance and enforcement; it's just that it hasn't been universally and comprehensively documented. We have issued the policy. We are actively working on the rest of the documentation that is necessary. We have a target to have the pilot scheme ready by March of next year, and we will meet that.

Mr. Philip Mayfield: May I have permission to complete this question?

The Vice-Chair (Ms. Marlene Jennings): Yes, you may.

Mr. Philip Mayfield: Thank you very much.

Your action plan mentions that the commission and staff will receive training on the compliance program at the end of 2002, and will complete all relevant documentation. What's the status of that initiative?

Mr. Mike Taylor: We have, I would say, about 50% of the documentation already drafted. We will be making plans for early next year to get the necessary training done.

Much of the training, the qualification of inspectors, for example, is already done. It is really a question of making sure everybody is aware of the most recent documentation. It is not as though we have to do a complete new training.

Mr. Philip Mayfield: Thank you, Mr. Taylor.

Thank you, Madam Chair.

The Vice-Chair (Ms. Marlene Jennings): Mr. Taylor, I feel that Health Canada has been neglected, so I'm going to ask Dr. Peterson a series of questions before we go to the third round of the members.

In the Auditor General's report, paragraph 26.42, the Auditor General points out that you don't have sufficient databases to adequately process, analyse, and disseminate information on diverse reactions and events for biologics after they have actually been in the marketplace. Your response was that a partnership agreement is being developed with the U.S. Food and Drug Administration for a combined database.

I'd like to know what assurances there are that the American adverse reactions won't dominate such a database. We don't necessarily have the same populations in terms of ethnicity, and the adverse reactions one might see in a particular population group may have no pertinence to Canada. We also don't have the same regulations in terms of the medications that are allowed on the market. They may be similar, but they're not identical. I'd like to know what assurances Health Canada can give us that if you do come to a partnership agreement, all of Canada's specificity will be ensured.

• 1635

Dr. Robert Peterson: Thank you, Madam Chairman. That's a very probing question, certainly.

The issues with having access to a larger database with regard to adverse reactions relate to the fact that Canada has 2% of the marketplace for pharmaceuticals, biologics, in the world today, and the United States has 60%.

It is also the case that this status has changed quite considerably in the past five to ten years, whereby products were slow to be introduced into the American marketplace and more rapidly introduced into Europe. Therefore, the early information, the very critical information when new products are just released into the marketplace and are exposed to a much larger treatment population than in the very carefully controlled clinical trial, has now changed, and it is taking place in the United States first.

We are pursuing a working agreement with the United States FDA to have access to their adverse-event reporting system, something referred to as AERS, with the specific provision that Canadian data would be introduced into it and it would be maintained separately so we could look specifically for Canadian data. We could look at combined data or United States-only data as well.

Your points with respect to the quite different regulatory framework, differences with respect to the indications for which a drug might be given, differences in dosages that are approved even for the same indications, are all quite relevant.

We are looking to have access to that database to generate signals to guide us in new directions to look more intensively within our own boundaries.

Having specified the most appropriate use of that database, it remains that the autonomous decisions on taking regulatory action on the post-approval market phase resides entirely within Canadian jurisdiction.

The Vice-Chair (Ms. Marlene Jennings): So our sovereignty will not be limited or diminished. That's good to hear.

I have a couple of other questions. One has to do with the lack of compliance verification the Auditor General points out in paragraph 26.44. It's a fact that Health Canada did not inspect or monitor the compliance of the sperm banks upon implementation of the semen regulations in June 1996 to March 1999. Why?

Dr. Robert Peterson: That is a reality. It is on the record. It happened. Explanations for that relate to the timing of the introduction of the semen regulations in a post-Krever era where there was a great deal of attention paid toward safety, particularly with the transmission of infectious diseases such as HIV, hepatitis, etc.

It is the case that the regulations that reference these guidelines were promulgated with a good deal of acceleration and they overstepped in timing the capacity for having inspectors on staff.

It was also the case, however, that we recognized that reports that would come out of this area of adverse events, as it were, would be quite open and quite transparent to us, so while we did not inspect, we certainly had surveillance systems in place with respect to all of these transmitted diseases that are in the category of sexually transmitted diseases as reportable entities.

We had good confidence that we would not be missing these occasions. In fact, that has been verified by virtue of having a complete inspection of every semen facility in the nation.

The Vice-Chair (Ms. Marlene Jennings): I have a last question for you. It appears the Krever report has had a chilling effect on recruiting new people. How is Health Canada dealing with that?

Dr. Robert Peterson: Again, that is one of the many factors. There are certain stark realities here. Certainly this is a very public, very visible, very carefully monitored system from the National Blood Safety Council on down, the Science Advisory Board, as well as many internal monitoring processes that are in place.

However, I believe the most relevant issue with regard to recruitment and retention in this area relates to the fact that these are largely leading-edge technologies in biotherapeutics, as well as in the introduction and design of recombinant products of DNA and newly developed web products.

• 1640

We have a shortage in Canada of many health professionals in many areas, and this happens to be one of them. Academic work in this area is quite strong and is growing. At the present time, the capacity within the academic world and within industry is still going to allow for relatively significant competition. However, as we've also pointed out, there have been some very substantial human resource initiatives in order to bring individuals in.

We use external advisory panels. We find individuals who are presently residing in academics, and we contract with them for a good deal of this work. I sit before you as someone who has come to Health Canada on an interchange program in order to provide these types of services.

The Vice-Chair (Ms. Marlene Jennings): Thank you.

I have one last question, and this is both to you, Ms. Keen, and to you, Dr. Peterson. You've both mentioned the problems in terms of recruiting qualified people, the shortages that exist not just for you on the public sector side, but the same shortages exist in the private sector, and that our universities are not necessarily graduating enough qualified people in the specific domains that you require. How do our immigration policies aid or obstruct the recruiting of qualified people in other countries?

I think of Russia, for instance. They have a lot of qualified people who, because of the difficult economic conditions, probably aren't working. Is our immigration policy of any assistance to you in bringing in qualified people?

Ms. Linda Keen: Speaking from the commission's point of view, we have staff on strength in the commission who are immigrants from various types of countries as well. However, one of the things the commission does is help other countries, including Russia, Ukraine, and China, to shore up their regulatory regimes, because they do have reactors on site as well. Since this is one area where we all are very concerned about safety more broadly, we're also trying to make sure that they have regulatory regimes in place as well.

But we have recent Canadian immigrants on staff, and that certainly is there. However, Canada has Candu reactors. We are fairly unique in this. All our reactors in Canada are Candu, and there is a degree of specialization about the type of reactors as well.

What we would really like to do is to grow more talent in Canadian universities. Although the commission must maintain its impartiality from our licensees, this is one place where I think we have to work more closely with them and the universities to do that.

As you are aware, research and education go together, so if we don't supplement the research dollars, we're not going to get the graduates either. So it's a two-way thing. But we look at qualified people all over the world, and that hasn't been a problem.

The Vice-Chair (Ms. Marlene Jennings): Thank you.

Dr. Robert Peterson: Briefly, we have a substantial number of foreign-trained physicians who are not able to acquire practising licences within the provinces of Canada, who come to work for us and who have, as you have pointed out, quite sophisticated credentials in science and health sciences.

In addition to that, of course, we are perhaps more aggressively attempting to repatriate Canadians who have gone to other countries where they have been either in practice in industry or in academics, in order to attract them back to Canada.

The Vice-Chair (Ms. Marlene Jennings): Thank you, Dr. Peterson.

We'll start the third round with Mr. Mayfield, for four minutes.

Mr. Philip Mayfield: Thank you very much, but I think it's actually Alex's turn.

The Vice-Chair (Ms. Marlene Jennings): No, it's Mr. Finlay's turn.

Mr. John Finlay: Thank you, Madam Chair.

Mr. Mayfield really covered the question I wanted to ask. It had to do with the fact that you published 22 regulatory documents, either for comment or in final form, in the last year, and before that there were 18 documents over 10 years. I was going to ask how many you needed in total, but I think you almost answered that.

• 1645

I want to know whether each reactor has to have a completely separate and distinct report, or whether there aren't similarities.

Mr. Mike Taylor: If I may clarify, the documents we're talking about are regulatory standards and guides. We report to our commission on each reactor every two years when the licences are renewed. We report halfway through that period in a progress report, and we report every year in an overall report, comparing all of the reactors. So we produce a large number of publicly available reports, but the documentation program that we were talking about refers to the standards and guides we issue that illustrate, both for our staff and our licensees, what we expect of them.

Ms. Linda Keen: Just to clarify, the issue is that the document isn't per reactor. The document would be on a specific area such as fire protection, or whatever. It would be a horizontal type of requirement. But the report would be by each licensee.

Mr. John Finlay: Thank you.

The Vice-Chair (Ms. Marlene Jennings): Do you have any further questions, Mr. Finlay?

Mr. John Finlay: No, thank you, Madam Chair.

The Vice-Chair (Ms. Marlene Jennings): Mr. Shepherd, you have some questions—four minutes.

Mr. Alex Shepherd: I am reading here from a press report that talks about an unproven commercial reactor. You allowed an unproven commercial reactor, called the Maple reactor, to run unsafely for months last summer. Is that correct?

Mr. Mike Taylor: That is referring to Atomic Energy of Canada Ltd.'s Maple reactors. It is true that the design is unproven. However, the period being referred to in the press report was the commissioning period when the reactor was under test.

Mr. Alex Shepherd: Was it unsafe or not?

Mr. Mike Taylor: No. It is clear that the safety systems were found in a separate test to not be as reliable as they should be, but no safety event occurred. The shut-off rods did not fail during the safe operation except when they were being tested.

Mr. Alex Shepherd: It says both sets of rods repeatedly jammed in tubes instead of dropping because small grit particles from poor workmanship clogged the superfine clearances. It says AECL hid its failure from the public for months by blocking the Nuclear Safety Commission from releasing the corporation's report about the incident, as requested. Is that true?

Ms. Linda Keen: The commission requires any licensee, whether that be AECL or any other licensee, to report immediately when there's a failure and when there's an issue. In this case, the AECL did not report in a timely manner the problems they were having.

The day before yesterday we met with AECL and talked to them about the issues. We had a complete lessons-learned report done on this, talking about both what AECL did and what we did that was wrong. In their case, they did not report in a timely manner the fact that these shut-off systems were not working effectively.

Mr. Alex Shepherd: But the analysis here is that you knew there was something wrong with these reactors and you did not report that to the public.

Ms. Linda Keen: No. The reporting requirement is by AECL, the licensee. In terms of the commission, it is the AECL who has a responsibility to report to the commission, and they did not do that. That was the failure.

Mr. Alex Shepherd: Are you saying you had no knowledge of this before AECL reported it to you?

Ms. Linda Keen: There had been one failure of the system, and we were investigating that. So the process we use within the commission is that if there is an incident, the licensee reports that incident and we investigate that.

There was one. While we were investigating one, there was another series of issues that they did not report to us.

• 1650

Mr. Alex Shepherd: But surely you independently audit these reactors. You don't ask the people running the reactor to tell you they're good, do you?

Ms. Linda Keen: There is a licence requirement, which is a very serious requirement, on the licensee that they report this. Now, these are non-power reactors. We do not have staff on site for every licensee. We don't have staff on site for 4,800 licensees. So we expect the licensee to report to us in a prompt manner.

Mr. Alex Shepherd: What would you normally do? If I was driving a car down the street and I broke the law—I was speeding—they would take my licence from me. What do you do at AECL?

Ms. Linda Keen: In this case, they have come before us to have a renewal of a licence, and the commission made it clear that there would be no permit given, no licence given, for them to start up their reactors until they fully and absolutely addressed all the conditions we put on them. AECL is in the process right now of working to address these issues.

Mr. Alex Shepherd: But they must have a licence to go through the start-up stage.

Ms. Linda Keen: Yes, they do.

Mr. Alex Shepherd: And that licence is still valid.

Ms. Linda Keen: They went before the commission two days ago. The licence hasn't been granted yet. It is a licence that allows them to develop the process. They cannot operate the reactor. They are not allowed to operate it.

Mr. Alex Shepherd: It was operated.

Ms. Linda Keen: It was in the test phase.

Mr. Alex Shepherd: We're just using words here. The reality is it was operating, maybe not at full capacity but it was operating. They have a separate licence to do that during a testing phase, presumably.

Ms. Linda Keen: Yes.

Mr. Alex Shepherd: And they are still holding that licence, correct?

Ms. Linda Keen: Well, they applied for a licence....

Mr. Mike Taylor: I'd like to clarify. They did have a licence to carry out the commissioning phase, which involved going up to power below 10%. That licence is now such that they cannot restart these reactors until they have absolutely addressed all of the conditions the commission has placed on them. So they cannot restart these reactors now as a result of these events.

Ms. Linda Keen: When this event happened, they were at 5% power and they were testing. They were under a licence. They do not have a licence at this time that would allow them to operate.

Mr. Alex Shepherd: This occurred last summer, almost a year ago.

Ms. Linda Keen: Yes.

Mr. Alex Shepherd: When did AECL put you on notice that it had a problem?

Ms. Linda Keen: In July, I believe.

Mr. Mike Taylor: The reactor was shut down immediately. The fourth incident occurred, and they have not had permission to restart that reactor since that time.

Mr. Alex Shepherd: But it must have operated for a time in an unsafe condition.

Ms. Linda Keen: There are two parts to it, in terms of the functioning versus the reporting. The minute there was a report of it by AECL to the commission, the order was given to shut it down, which was July.

Mr. Alex Shepherd: So what was the timeframe, then, between the time the thing was actually operating unsafely, the time you were informed of it, and the time it was shut down?

Mr. Mike Taylor: It first went critical in February of last year and it was shut down in July, so approximately five months.

Mr. Alex Shepherd: So it ran unsafe for five months.

Mr. Mike Taylor: It was being tested in that time. It is true that the reliability of the shut-off rods was not as good as it should have been. That is correct.

Mr. Alex Shepherd: What's the impact on your credibility?

Ms. Linda Keen: We have just recently completed a report that looked at the lessons learned, which we put before the commission yesterday, in terms of what we learned about this. The report discussed a number of root causes in terms of what we could have done differently. However, the report did say that overall the work of the commission, in terms of its oversight—because that's what the commission does, oversight on a licensee—was within our guidelines and within our regulatory act. It said there were three things we could do better. It said that because it was an untested procedure, an untested area, we relied on AECL, the licensee, which is our process, and we should review our processes when a licensee is trying something untested. It also said we had to do a better job of integrating comments from a number of different areas of the commission, and we also should ensure we have adequate staff on projects to do that. So we did our own investigation.

• 1655

Mr. Alex Shepherd: Anyway, the conclusion is that we had an unsafe reactor operating for five months without your knowledge. Can you inform this committee, maybe sometime within the next month or so, what procedures you are going to develop to prevent that from ever happening again?

Ms. Linda Keen: Yes.

The Vice-Chair (Ms. Marlene Jennings): Thank you, Mr. Shepherd.

Perhaps you can provide this committee with a copy of your lessons learned report. We'd appreciate that.

Mr. Mayfield.

Mr. Philip Mayfield: Thank you, Madam Chair.

The recommendation in paragraph 26.33 for Health is that

Health Canada should develop clear criteria to assists its officials in determining which regulatory approach is most appropriate for a given situation.

You agree with that, but then you go on to say that in addition, you're undertaking a legislative instruments project. Can you tell me what a legislative instruments project is?

Ms. Jean Peart (Senior Adviser, Quality Systems—Biologics and Genetic Therapies Directorate, Health Products and Food Branch, Health Canada): Because, as was said earlier, the Food and Drugs Act is a little outdated, several initiatives are under way to look at changes in that regard. But there's also a special project where they are looking at the whole issue of standards-based regulations, and that's what is being referred to here. The standards council is the group that we are actually looking at, the CSA, to do the regulatory framework if we are going to be using a standard. The staff have been trained, they're sitting on some of the technical committees, and so on. So the idea we have is that if you are going to have someone else writing the standards, you should have criteria developed, so that you will know whether or not that particular instrument will work under those particular circumstances.

Mr. Philip Mayfield: Does that wording “legislative instruments” relate to verifying what you're doing with the legislation that's there, proposing new legislation, or both?

Ms. Jean Peart: It is a project to ensure that the regulatory framework used for a particular set of regulations is the appropriate one.

Mr. Philip Mayfield: Madam Chair, in her questioning, raised the issue of staffing, and she mentioned the environment since the Krever commission report. A number of reasons are given for difficulties in filling vacant positions, non-competitive salary structures, slow hiring processes. I would like to know what your plan is, because it seems to me you must have the qualified people to do your work. How do you work in this area, where so many people depend upon you, when you don't have the people to do your job? What is your plan for acquiring the staff you need?

Dr. Robert Peterson: As I mentioned earlier, in the interim, as we are attempting to recruit a full complement in this area, we are using external experts, advisory panels, advisory committees, and individuals, with whom we contract, despite the fact that they may not move to the national capital region.

• 1700

In addition to that, what we have done, in this area and throughout therapeutic products, is to identify a director of a human resources initiative, in order to enhance the efficiencies by having job descriptions, competitions, staffing actions coordinated. So a scientist who has an interest in coming to Health Canada, but has not been selected in a competition in one area of the department, would be immediately identified and be available to compete in another area. So we are attempting to get as much efficiency out of the public service requirements presently in place as possible.

In addition to that again, approximately two months ago I wrote personally to every physician in the national capital region identifying for them the opportunities that would exist for a complementary practice with respect to Health Canada opportunities in this area, as well as other areas of therapeutic products. We published similar advertisements in four major medical journals.

The recruitment activities that go on across the country have our presence there, and the opportunities to have individuals come for post-doctoral experiences in a program that we sponsored previously with the Medical Research Council, now with the Canadian Institutes of Health Research, provide training opportunities.

Mr. Philip Mayfield: What about the funding, the competitive salary structures? Is there help you need in that area?

Dr. Robert Peterson: It would be an understatement to say that there are not significant problems in this area. We are competing not just with academics, where we do not have huge discrepancies, but with industry, and in the case of medical specialists, we are competing with the funding scheme that exists within the health care system. So we do require other mechanisms in order to enhance that. There is a recent study by Health Canada looking at the necessity for supplements to physicians' packages, both as recruitment bonuses and for their ongoing support here. There was a substantial increase in the salaries allotted in those areas.

Mr. Philip Mayfield: To think outside the box a little, I notice that there's more and more said about standards-based regulations, if that's the correct term, rather than the usual method of setting up the regulations and then issuing them. Is this in some sense a way of dealing with your enforcement of regulations when more of the industry is involved in them?

Dr. Robert Peterson: We're off the human resources issue now.

Mr. Philip Mayfield: Well, actually, we're not off the human resources. It takes people to enforce these things.

Dr. Robert Peterson: I understand.

Mr. Philip Mayfield: I'm wondering if you're going the standards-based way because industry people may be able to pick up some of the slack of what you can't do by enforcing the regulations in the usual way.

Dr. Robert Peterson: No, that's not the case. There is no link between standards-based reference in regulations and our human resources issues. This has to do with the corporate agility we require in order to make changes to the requirements in this area. The regulatory process, at its best, is not capable of keeping up with the movement in this area, and as a consequence, we have moved towards the development of standards, to allow for those changes to be made. We are looking towards the referencing of standards in our regulations as a vehicle to allow for us to have a greater agility and responsiveness to changes that need to be made.

Mr. Philip Mayfield: In your particular area it is a matter of great concern that you do have the responsibilities and perhaps not all the people you need to fulfil those responsibilities. What alternatives are there, if you're not able to acquire the staff? Is there a way you can outsource this, with other people doing the regulatory work and you supervising the regulators? Are there thoughts in this direction? This is a fast-growing industry, and I'm wondering what thinking is being done for the government to keep up with it in its regulating.

• 1705

Dr. Robert Peterson: Many opportunities exist outside of the box, as you originally described it here.

Certainly we are outsourcing. We are using expert advisory panels, who come largely from academics and other private practice environments, in order to take advantage of the expertise they can bring to the table.

We are also certainly in the process of seeking partnerships with other regulators throughout the world. We recognize that Canada is a small regulator. We are one of the few regulators left in the world that attempts to regulate areas such as this by ourselves.

The European Union has given a number of small regulators the opportunity to come together and share those responsibilities. I would like to point out that this regulatory consortium did not exist prior to the economic union. It was not the case that the regulators were easily able to come together, to join forces and cooperate like that. But having been brought into that consortium, it is apparently working quite well.

We are seeking the opportunity to share elements of the review, again maintaining the autonomy that says decisions with regard to a product receiving authority to be marketed in Canada will reside within Health Canada and the regulatory requirements of Health Canada. However, in today's marketplace we can take advantage of a product that is produced, perhaps in a single location in the world and marketed worldwide, and has already been reviewed for its quality, chemistry, and manufacturing processes, etc.

We can leverage the fact that other equivalent agencies have had the opportunity to look at the quality associated with that manufacturing process, and not simply accept their decision, but be able to much more rapidly review the application by reviewing the questions they asked and the responses they achieved, and looking at the post-market environment, to a certain extent.

We have a mutual recognition agreement in place at the present time with Switzerland, in order to look at good manufacturing processes—the after-market approval of products—in a fashion that allows us to accept the inspections and reports of companies that are producing products in Switzerland. There is a reciprocal agreement with Switzerland, whereby they will accept the reports for those products that are being approved in Canada.

We are very close to a similar agreement with the entire European Union, and are in discussions, at an early phase, with Australia and New Zealand.

So I agree with you it is going to be very important, given the intensity of this area, for us to develop as many opportunities as possible outside of our own confinement.

Mr. Philip Mayfield: It's very stimulating to talk with these professionals, particularly for an amateur like myself, who struggles to keep up with the language and concepts of two important areas, like we have here today. But I thank you very much.

The Vice-Chair (Ms. Marlene Jennings): You're very welcome, Mr. Mayfield.

I have just two small questions, before we wrap up and I give the last word to Ms. Fraser, the interim Auditor General.

You've both talked about the difficulties you've had, in terms of recruiting and retaining qualified staff. You, Ms. Keen, mentioned some of the programs you have, in terms of the internship program. You, Dr. Peterson, also mentioned some.

In some other sectors, one element of the solution, in terms of encouraging young people to see those fields as fields of study for them, has been to develop both educational programs in the grade schools and the high schools, and scholarships.

Do you see that as a possibility? Does it exist already? If it doesn't, do you see that as one piece of the puzzle?

My second question is on the Quail task force to completely overhaul the management of our human resources regime in the government. That's a major reform. I'd like to know what input Health Canada has given, as an arm's-length body, and will be given, so your specific needs are taken into account.

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Obviously, when we're talking about over 800 job classifications, it's crazy. I'm sure that doesn't help you at all, in terms of recruiting and maintaining qualified staff.

So we'll hear answers to those two questions, and then shut down after the last word by Ms. Fraser. Perhaps you'd like to begin, Ms. Keen.

Ms. Linda Keen: Thank you very much. With regard to the schools, per se, we haven't had a program in the schools ourselves. About 90% of our staff is located in Ottawa, but we do have about 26 staff members in the sites. They participate in the community very widely. However, the industry itself is very much involved in the communities, and is doing extensive work in the schools.

On scholarships, I think they are a great idea. Within my very limited budget, that's exactly what we're offering right now, to this network of Ontario universities. We hope to expand to Quebec next year. But it takes money, and since I'm 77% cost-recovered, I don't have that money to give. Inevitably, we must link research and moneys for this together. We would be more than pleased to do that, and I do it in my very limited way.

On the reform of the public service, I came from the public service less than six months ago, and I think there are some issues going on there. We are a separate employer. In fact, Mr. Clayton has said that people, such as ourselves, that are separate employers probably have some good ideas to offer them, in terms of the flexibility and what we've been able to do inside. When we go to them to offer, for example, special incentives for engineers or whatever, the Treasury Board has to look at what they're giving us, in terms of money, and compare that to what they're doing for other parts of the public service.

In some ways we are grosso modo controlled by what is offered more broadly. For example, in the IT community, we couldn't offer our IT people more than what's happening in other places. So I guess we're one of the laboratories, as a separate employer, of what can be done. The Auditor General said we should be doing more with this freedom, and that's exactly right. We have to do more with the freedom we have.

I hope we have some lessons learned to offer.

The Vice-Chair (Ms. Marlene Jennings): Dr. Peterson.

Dr. Robert Peterson: Thank you.

Very briefly, we have an area where there is a great deal of interest, understanding, and enthusiasm for people to go into training programs. We are not formally going into high schools, but we give large portions of the courses in faculties of pharmacy and medicine across the country, in order to both offer opportunities for our own staff for their continued professional development, and allow other bright young students and trainees in this area to get a much better appreciation.

We allow for those individuals to come in to spend time with us. That includes medical residents, by the way, as a portion of their training programs, where appropriate. In the last two years, several have joined us for up to four months of experience in that area. It also includes pharmacists and other basic scientists, who come in to spend some time with us.

With respect to your second question on the reform of human resources, I cannot comment specifically on the reform process you're talking about, but we'd be pleased to get back to you. We are still in the midst of universal classification, as a means of helping us at least take one step forward. Then hopefully, at the output of that system, we will be able to see some of the other initiatives brought on board.

The Vice-Chair (Ms. Marlene Jennings): Thank you very much both of you. Just a little suggestion. My daughter, who's eight years old, as a result of having had scientists come into her school from the time she was in kindergarten, decided she wanted to go to a school—she's starting grade four in September—that had a specific emphasis on natural sciences. So you may want to push your outreach further down, because a lot of times it's too late for high school and college. Children have to make their choices, in terms of the levels of math and science courses, and once they get into CEGEP, they don't have the required courses to go into those programs. They're discouraged, and therefore don't consider them. So you may want to push it down further.

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Ms. Fraser, before I give you the last word, I would just like to say I've just learned that the Prime Minister has announced your appointment as the new Auditor General of Canada. On behalf of this committee, I wish to congratulate you and say how pleased we are with that appointment.

Some hon. members: Hear, hear.

Ms. Sheila Fraser: Thank you, Madam Chair. I find it somewhat fitting to be sitting here when the nomination was made. Thank you very much.

The Vice-Chair (Ms. Marlene Jennings): You have the last word, as the Auditor General of Canada.

Ms. Sheila Fraser: With my closing remarks, I think we would all agree that health and safety regulatory programs are very important to Canadians, and require ongoing and sustained efforts and attention. We would encourage the committee to ensure that the actions promised actually become reality.

I was also going to make a link with the hearings we recently had on the human resource modernization initiative. I'm pleased to see that Madam Chair has already raised that issue. I hope that in any further deliberations you might have on the HR initiative, you will consider some of the issues that have been raised today, especially on scientific and technical personnel.

Finally, I have to close by encouraging the members of the committee to hold a hearing in the fall on the broader issues we have raised in our chapter 24, coming out of the five audits we have done.

Thank you very much.

The Vice-Chair (Ms. Marlene Jennings): Thank you very much, Auditor General. I like that.

This committee meeting is now adjourned until 9:30 a.m., Tuesday, June 5, 2001. At that time the committee will consider chapter 15, Health Canada, first nations follow-up.

Thank you very much.