Our Reference:   R15/15998
30 November 2015
Dr Carl-Magnus Larsson
Chief Executive Officer
ARPANSA
PO Box 655 
Miranda NSW 1490, AustraliaNuclear Safety Committee 
Advice to the CEO of ARPANSA
Dear Dr Larsson
I refer to your request (30 October 2015) that the Committee provide you with their advice and recommendations relating to several areas of regulation of an expanded nuclear industry, should a government be minded to allow or promote nuclear facilities currently not in operation in Australia.  The Committee’s recommendations focus on the following areas:

•	The functional structure of the regulatory body;
•	The jurisdictional scope;
•	The jurisdiction - state/territory and Commonwealth; and
•	Regulatory capacity and capability.
These areas were discussed during the June and October 2015 NSC meetings and the recommendations and advice of the Nuclear Safety Committee are attached.
Yours sincerely
Dr Tamie R Weaver
Chair of the Nuclear Safety Committee

Attachment 1:  Recommendations regarding the options available for the regulation of an expanded nuclear industry within Australia.

NSC recommendations to the 
CEO of ARPANSA
Recommendations regarding the options available for the regulation of an expanded nuclear industry within Australia
Functional structure of the regulatory body
The Committee discussed several alternative regulatory models for an expanded nuclear industry in Australia, drawing on members’ experience within Australia and overseas.  We consider that ensuring the regulatory body maintains independence from industry and government is of upmost importance, thereby increasing confidence for the operator and public of the Regulator’s decision making and effectiveness.  
Consistent with this, mechanisms should be in place to provide transparency regarding the independence of regulatory decisions.  For example, if a Minister is able to instruct the regulator, the instructed actions should be tabled in parliament.
The Committee considers that a CEO with an Advisory Board would be an effective framework on which to build regulation.  This model combines a single accountable person for regulatory decisions (e.g. the CEO) with the diversity of knowledge and experience of an Advisory Board.  The decision-maker must have relevant knowledge and experience so that they can target questions and judge advice received.  Several members noted that the UK Office of Nuclear Regulation (ONR), which is a public corporation, detached from Government and headed by a CEO and Board of Directors, has been considered by the global Nuclear Community to be an effective regulator.
The Committee discussed the merits of an Executive Board in comparison to an Advisory Board, and considered that an Executive Board may have certain advantages in regard to joint decision making, especially in a young organisation.  With this and other models, however, there may be difficulties regarding the accountability of decision making.  A feasible approach would be that an Executive Board could transition to an Advisory Board as the regulatory organisation matures.
The Committee also considered the merits of a single regulatory organisation compared with a regulatory body supported by a technical services organisation.  A regulatory body supported by a technical services organisation may be more appropriate for a country with major involvement in nuclear activities, like France.  For Australia, at least in the initial stages of an expanded nuclear industry, two bodies may be an unnecessary complexity and expense.  Members pointed out that the requirements of the regulatory body and/or technical services organisation are clearly stated in the IAEA General Safety Requirements Government, Legal and Regulatory Framework for Safety, GSR part 1.
In summary, the structure preferred by the Committee is a CEO supported by an Advisory Board, ensuring that the expertise of the regulatory body is consistent with IAEA General Safety Requirements.  The Regulator’s independence from both government and industry is fundamental, and the regulatory framework and regulatory body should be established well in advance of any expansion of the nuclear industry.

Jurisdictional Scope
The Committee considers that the structure of the regulatory body would be dependent on the combination of nuclear industry expansion options that may be pursued.  For example, both mining and the storage and disposal of nuclear waste are likely to have predominantly localised impact which, particularly in the case of mining, may be able to be managed by a state-based Regulator. However, under these conditions, there would need to be a will to assess and appropriately address possible gaps between the state and federal jurisdictions.  The other fuel cycle options were more likely to have cross border implications; hence there was a stronger argument for a multi-jurisdictional authority to regulate these options.
Overall, the Committee’s consensus was that a single nuclear regulator provides substantial advantages in delivering a uniform and efficient regulatory service, particularly when considering the specialist resourcing required.  
There is an advantage in the materials accounting (safeguards) and the physical protection and security of nuclear material sections of ASNO being transferred to the single nuclear regulator. ASNO, as a division of DFAT, would continue to ensure that obligations under Australia’s international treaties are met and would manage Australia’s bilateral safeguards agreements.
In the area of transport of radioactive materials it would be appropriate for the regulatory body to be responsible for road, rail and inland waterways transport.  States and Territories could be granted authority to regulate routine low activity transport (e.g. uranium ore from mines).  AMSA would continue to be the authority for sea transport and CASA for air transport.
Following a discussion of the possibility of combining nuclear regulation with other regulatory functions such as workplace health and safety and environmental protection, Committee members reached a consensus that combining these functions under a single regulator would be excessively complex.  Such a multi-function Regulator would be neither ideal nor necessary; however, good communication between the various regulatory bodies is required.  The Committee agreed that specific areas including radiation protection, nuclear safety, safeguards and transport should fall under the nuclear safety regulator. 
In summary, the Committee considers that, due to the specialist nature of nuclear fuel cycle industries, a single nuclear regulator that encompasses radiation protection, nuclear safety, safeguards and transport (with the exceptions noted above) would provide substantial advantages.

The jurisdiction - state/territory and Commonwealth
The Committee considers that, with the possible exception of mining, the safety and security regulation of an expanded nuclear industry should fall under a single Commonwealth Regulator rather than under separate state and territory Regulators.  A single Regulator would provide consistency across the existing jurisdictions and therefore would be more efficient and less burdensome on the industry.  

Regulatory capacity and capability
Based on members’ experience, the Committee considers that the question of regulatory resources needs to be determined long before a nuclear-industry expansion program is initiated.  Having the regulatory framework in place would allow targetted planning by the industry for such regulation.  
Consequently, financial investment to establish the regulatory body would be required prior to development of the industry, and employment with the regulator would need to be sufficiently attractive to entice workers from industry.  Based on the limited capability within Australia at this time, Australia may need to look overseas for sufficient qualified resources to staff an expanded nuclear regulatory authority.  Although the Australian environment does not require a large regulatory authority, there are core areas of expertise that must be available in house (e.g. mechanical, electrical, nuclear, instrumentation and control). This expertise is important so that the Regulator knows the questions to ask and can judge information provided by manufacturers and industry.  
The Committee agreed that the regulatory body would need to be established in time to build its capability in relevant areas before any expansion of the industry became advanced. Hiring the expertise necessary to do this from overseas is a normal practice across many industries, particularly given the importance of hiring experienced people; the risk that the expertise leaves the organisation is a downside of this approach.  In the longer term, Committee members considered that ongoing education and training are important aspects of building regulatory (and industry) capacity and capability.  However, there are currently limited nuclear science and engineering courses at Australian universities.  In the case of an expanded nuclear industry and the regulatory body required to service it, Australia would likely need to recruit, at least initially, from overseas.
During our discussions, the Committee noted that ARPANSA currently undertakes some research and provides specific services to the industry.  In the case of an expanded nuclear industry, the regulator would need to be mindful of the risk that such activities could become, or be perceived, as a conflict of interest.

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