Natural Resources Committee on Jan. 29th, 2008

[Mike Allen, Conservative, Tobique—Mactaquac, NB]

I'll be quick, then. In 2000 you examined CNSC and recommended the separation of the positions of chief executive officer and chair. Can you explain briefly why you made this recommendation and what benefits you think would be gained as a result of that recommendation?

[Sheila Fraser]

At the time, we did make that recommendation. I think it was becoming common practice, certainly in crown corporations and others, that the chair and CEO functions be separate. There were some comments within industry that there should be a separation between the chair of the commission, who conducts the hearings, and the CEO of the regulator.

We made that recommendation. It was not accepted. There was an indication that there had been reviews done of other regulators more broadly--internationally--and that the practice was to have those two positions together.

[The Chair, Conservative, Leon Benoit]

Thank you, Mr. Allen.

We have about five minutes left, and I am going to allow one short question from each party, if you wish to speak, starting with Mr. Tonks from the official opposition.

[Alan Tonks, Liberal, York South—Weston, ON]

Thank you very much, Mr. Chair.

Madam Auditor General, welcome to you and your colleagues.

As you were giving your overview, I was reminded of the statement that there are three kinds of people: people who make things happen, people who watch things happen, and people who say, “What happened?” I think the public is trying to understand, through this committee, what happened.

In your report you indicated that when your examination was made in 2007, you were not aware of any regulatory compliance issues related to the operation of the NRU reactor and that there was no mention in the report of issues linked to the recent shutdown.

My question is aimed at attempting to take further steps with respect to closing the accountability loop. In other words, where does the buck stop?

Earlier you indicated, with respect to the licensing conditions, that in your examination, between February and October 2006, some licensing issues had cropped up. You also said that timely corrective action was taken to address these situations. My question is this. Had the AECL and the CNSC made an application for regulatory changes under their statutory area, is it possible that if action had been taken at that time, the shutdown of the Chalk River reactor could have been avoided? Did you have any follow-up role with respect to that?

As I say, Madam Auditor General, my question is aimed at knowing what recommendations would be made to close that accountability loop. It is not meant to be unduly investigative or anything like that. Thank you.

[Sheila Fraser]

Thank you, Mr. Chair. I believe the incidents that have been referred to were environmental in nature. There were some incidents that occurred that were dealt with effectively. The commission was advised and corrective action was taken appropriately.

I really can't comment on what happened in December because we haven't looked at that and we don't know what the facts are around that. But at the time of our audit, up until March, there was certainly no indication by either the corporation or the commission that there was a licensing problem with the NRU.

[The Chair, Conservative, Leon Benoit]

Thank you, Mr. Tonks.

We go now to the Bloc Québécois, Madame DeBellefeuille.

[Claude DeBellefeuille, Bloc, Beauharnois—Salaberry, QC]

Thank you, Mr. Chairman.

Ms. Fraser, the CNSC deals with nuclear safety. That is its mandate as defined in the legislation. The AECL must, amongst other things, supply its clients with medical isotopes. These are two completely different mandates. The commission has nothing to do with medical isotopes.

The Prime Minister attacked Ms. Keen's credibility in the House, accusing her of partisanship. Minister Lunn, who is guilty of political interference where Ms. Keen is concerned, also accused her, saying that she had poor judgment and that she had badly managed the situation. In our opinion, she was not the right target. We believe that if the minister had acted responsibly, he would have convened parliamentarians so that they could decide on the issue. Had he done that, he would have shown Quebeckers and Canadians that he respects arms-length organizations and that their independence is important to him. He could have used other tools rather than publicly denouncing a person who has a perfect record and who had complied with the law.

Who is responsible for the hiring and appointment of AECL's CEO?

[Sheila Fraser]

That appointment is made by the governor-in-council.

[Claude DeBellefeuille, Bloc, Beauharnois—Salaberry, QC]

Does that mean that it is made by the Minister of Natural Resources?

[Sheila Fraser]

The minister obviously has a role to play in this matter. This is often also done with the Privy Council Office and others.

[Claude DeBellefeuille, Bloc, Beauharnois—Salaberry, QC]

All right. You are telling us that we have been in full crisis mode for at least two years. The government and the Department of Natural Resources know that things are not going very well at AECL, particularly at Chalk River Laboratories. They are aware of this, everyone knows it, we have read all of the notes. The government was aware that the CEO was leaving on November 1, but it did not appoint a new one until December 14.

Do you not feel, Ms. Fraser, that there was a significant lack of leadership on the part of the government as far as the appointment of AECL executives is concerned, particularly given the information they had concerning the problems of the aging reactor?

As a citizen and a member of Parliament, I say to myself that it is inconceivable that a government that was aware of the situation in these laboratories could have neglected to hire someone very quickly in order to avoid AECL experiencing a vacuum in their management and governance. What do you think?

[The Chair, Conservative, Leon Benoit]

Thank you, Mrs. DeBellefeuille.

Madam Fraser.

[Sheila Fraser]

I do not want to comment on that particular situation because I do not have enough information. However, I must say that during previous audits, we emphasized the fact that there are quite frequently delays in appointments to crown corporations. In some cases, it concerns appointments to boards; in others, it concerns hiring a CEO. There can be vacant positions on boards for long periods of time. It also happens that the leaders of several organizations are appointed on an interim basis or are waiting to obtain the position. This governance problem is not a recent one. It has been going on for several years, and we would like a lot more attention to be paid to appointments. In fact, we are currently doing an audit that deals with appointments.

[The Chair, Conservative, Leon Benoit]

Merci.

We now go to Ms. Gallant for about two minutes.

[Cheryl Gallant, Conservative, Renfrew—Nipissing—Pembroke, ON]

Thank you, Mr. Chairman.

If you don't have time, I would ask that you respond to the questions in writing to the committee after this.

Through you, Mr. Chairman, to the Auditor General, we hear that one of the outstanding problems that AECL had with the previous government was its inability to get approval for a corporate plan. This led to a number of unresolved strategic issues, including the funding of a replacement research reactor mentioned in the 1998 report. The issue came up again in the 2002 report, where it was stated that there was no consensus on how best to manage the nuclear platform, which included sustaining nuclear medicine.

So the previous government had been made aware of the problems at AECL on more than one occasion by your office. In the special examination report of the board of directors of AECL in 2007, in the section that refers to the unresolved strategic challenges and, more specifically, the completion of a dedicated isotopes facility, there was not the same sense of urgency that had been indicated in the 2002 report. How should the government of the day have responded to the 2002 report—which would have avoided what happened in 2007?

In 2002, billions of dollars were being directed into foundations. So funds for R and D were available, but why not for AECL?

What was AECL doing wrong that they would not be considered an appropriate candidate for what your reports have identified as a crown corporation in desperate need of funding?

Does your office audit the CNSC?

And lastly, in the 1998 report, there was mention of the workers finding some kind of nerve gas buried there. Could you tell me specifically what that substance was, and on whose behalf was it buried there?

We'll just go from there. Thank you.

[The Chair, Conservative, Leon Benoit]

Thank you, Ms. Gallant.

Madam Fraser, we only have a couple of minutes left. See what you can do.

[Sheila Fraser]

I can answer very rapidly.

I have no knowledge of the question of nerve gas. That was certainly not raised in any audits we did.

Yes, we audit the commission. Our last audit report was within a report tabled in Parliament in February 2005.

All of the previous questions are largely questions of government policy as to why certain funds were directed.... I do not comment on policy. I will say, though, that the question of a lack of strategy and policy for nuclear energy is a long-standing issue. It has been present throughout all of the special examination reports. It is evidenced by the lack of approval of a corporate plan for many years. Again, for the current year, the corporate plan has not been approved. So it is an ongoing issue that, hopefully, will be resolved.

[The Chair, Conservative, Leon Benoit]

Thank you very much, Madam Fraser, for your concise answers, as usual. They're very much appreciated. I say this, of course, to the Auditor General of Canada, and also to Ms. Cheng and Monsieur Plouffe. Thank you for coming today. We appreciate it very much.

We're only going to suspend for about three minutes, because we want to get to the next witness as soon as possible.

Thank you very much.

[The Chair, Conservative, Leon Benoit]

Good afternoon, everyone.

We are continuing our meeting with the second hour and the second witness. We have in this hour, Linda Keen, commission member, ex-president of the Canadian Nuclear Safety Commission.

Thank you very much, Ms. Keen, for being here today. You have about 10 minutes for an opening statement, and then we'll get directly to the questions.

Please proceed.

[Linda Keen, Commission member, Ex-President, Canadian Nuclear Safety Commission]

Thank you, Mr. Chairman.

Thank you, members of the committee, for this opportunity to meet with you today.

The recent events surrounding the nuclear facility at Chalk River and their impact on the supply of medical isotopes has raised a lot of questions among Canadians.

Canadians want to know—quite rightly—how such a situation could have developed. And they want to know what role the Canadian Nuclear Safety Commission played in these events.

This morning I'd like to answer those questions, and I hope the information I supply will be helpful to this committee as it carries on its work.

First, why didn't the CNSC just go ahead and allow the NRU to operate without the emergency power system connected, given that there was a medical crisis, and why did the CNSC close it down?

The role of the CNSC is to ensure the safety of Canadians by regulating Canada's nuclear facilities. That's our job, that's our responsibility, and that's what the law prescribes. Some have suggested that the chance of a nuclear accident was low and the reactor was safe enough. With respect, safe enough is simply not good enough. Safety at a nuclear facility needs to meet the same high standards we expect from a space shuttle or a jumbo jet. The regulations the commission enforces and the standards it upholds are about far more than pushing paper; they are really about protecting lives. That's why when it comes to nuclear facilities, ignoring safety requirements is simply not an option--not now, not ever.

Some will say that the operation of a reactor always carries some risk with it, and that's true. But there are carefully established international standards as to what constitutes an acceptable risk. In the case of a nuclear fuel failure, the international standard for acceptable risk is one in a million. The chance of such an event happening at Chalk River without either of those pumps connected to the emergency power supply was one in a thousand. That is a thousand times greater than the international standard. Remember that NRU, as originally designed and constructed over 50 years ago, would not be licensable today by any nuclear regulator in the world.

There seems to be an impression left that CNSC ordered the NRU shut down. In fact, Atomic Energy of Canada Limited shut it down on November 19, 2007, for routine maintenance. It was AECL that extended that shutdown, because, as its senior vice-president told a CNSC public meeting on December 6, 2007:

the only safe and prudent action available to me, I believe, in this situation was to shut the--keep the reactor shut down and perform those upgrades.

The commission's responsibility was to oversee that those upgrades were completed by AECL. Prior to the passage of Bill C-38, those upgrades were not in place.

The second question was why the CNSC didn't take into account the effect of a shutdown on the production of medical isotopes. This is an important question that goes directly to the mandate of the CNSC.

As I mentioned, our primary responsibility in the case of this facility is to protect Canadians by ensuring that the nuclear facility is operating safely. Under the law, the commission did not have the authority to take the issue of isotopes into consideration when making its decision up to December 10. Indeed, in its directive of December 10, 2007, the government implicitly recognized this limitation on the commission's mandate by seeking to expand its authority to include consideration of the availability of isotopes. Such an expansion would not have been necessary if the commission already had that responsibility. The fact is it did not.

That said, the CNSC has always been very sensitive to the importance of these isotopes. The medical community relied on them and patients needed them; that's why the commission took every action available to it under the law to alleviate the situation. As the body responsible for licensing hospitals and clinics that use medical isotopes, the commission was able to amend licences on request in less than 24 hours to permit the use of alternative isotopes and to increase their inventory. That was within our mandate.

AECL itself recognized these efforts in a letter to the commission dated December 7, 2007, where it said:

We believe that the health care community and the public at large have been reassured by the CNSC's demonstrated sensitivity to the importance of the beneficial use of radioisotopes....

To further alleviate the isotope situation, the commission also agreed to fast-track a complete application from AECL to get the reactor up and running, with a commitment to meet within 24 hours rather than the usual 60 days. In addition, the commission advised AECL that commission staff stood ready on a 24/7 basis to do everything in their power to help.

The third question is, why has the CNSC made such a big deal about its independence?

Well, Mr. Chair, independence in regulating nuclear facilities matters. It matters because nuclear reactors are in communities where Canadians live.

People in Chalk River, in Clarington, and in Bécancour all depend on the CNSC to ensure their families are safe. They need to know that the commission will make its decisions based on what's right. Indeed, Parliament delegates decision-making powers to these independent bodies like the CNSC precisely to preserve public confidence in the fairness of the process and the safety of the facilities. Under the law, that's how it's supposed to work. The Nuclear Safety and Control Act establishes the CNSC as a quasi-judicial body, as a court of record, and like a court, to be free of interference.

The government itself recognized the importance of such independence in its Accountable Government: A Guide for Ministers, 2006, which states:

The nature of the relationship between a Minister and an administrative tribunal with independent decision-making or quasi-judicial functions is a particularly sensitive issue. Ministers must not intervene in specific decisions of those bodies.

So the importance of independence is not something I've come to recently, as a matter of convenience.

That is why, before every hearing—and I have presided over hundreds as President of the CNSC—I read out a statement explaining the independence of the Commission.

So I haven't come to this recently. It's not a matter of convenience; it's a principle that I've insisted on.

Question 4, and relatedly, how did the CNSC react to Parliament's decision to legislate the reopening of the NRU reactor?

Well, Mr. Chair, Parliament is supreme, period. Neither I nor any Canadian would ever question the right of Parliament to act as it did.

Parliament was faced with two competing interests: nuclear safety, on the one hand, and the need for medical isotopes, on the other—not an easy decision, and one appropriately made by the elected representatives of Canadians.

Since the passage of that legislation, and as long as I was president, the CNSC has done everything it can to ensure it is in compliance with that bill. I also launched a lessons learned study led by international experts, a study that the commission had hoped would feed into a wider government review.

Mr. Chair, the situation that developed at Chalk River was one that no one sought and few foresaw. Different actors had different roles to play and different responsibilities to fulfill. I believe that at all times the CNSC acted as mandated by Parliament, as the body charged with ensuring nuclear safety.

Beyond that, Mr. Chair, I would hope that we would focus on learning the lessons of Chalk River so that this situation would never arise again. Canadians shouldn't have to choose between nuclear safety and medical isotopes; they should be assured of both.

To do that, we need to be sure that we have appropriate systems in place and that the roles and accountabilities are clearly defined. Canadians expect no more and they deserve no less.

With that, I thank you, Mr. Chair.

Thank you, Mr. Chairman.

I am now available to answer questions.

[The Chair, Conservative, Leon Benoit]

Thank you very much, Ms. Keen.

We'll go directly to questioning now, starting with the official opposition.

Mr. Alghabra, you have seven minutes.

[Omar Alghabra, Liberal, Mississauga—Erindale, ON]

Thank you, Mr. Chair.

Ms. Keen, thank you for coming here today.

Before I begin my questions, I would like to offer you my apologies for the way the Conservative government has treated you. I don't personally know you, but from everything I've learned that is available in the public domain, I know you have been and continue to be a dedicated public servant who is committed to her job and takes her responsibility extremely seriously.

For no other reason, from what I can see, than purely political reasons, unfortunately your name and reputation have been dragged through the mud by this Prime Minister. It must have been horrifying for you and your family to watch it happen.

I just want to assure you that Prime Minister Stephen Harper and Minister Gary Lunn do not speak for me as a member of Parliament, and I want to reiterate my apology. This is not how I believe dedicated public servants who have committed 20 years of public life should be treated. Thank you again for being here.

As I understand it, you were fired the night before you were about to testify before this committee, late at night. Can you please elaborate on that? Can you tell the committee how it happened?

[Linda Keen]

Thank you very much for the question.

Well, of course, I was preparing to come to the committee on the 16th and very much looking forward to this. About 8 o'clock I went home. The staff were still putting some materials together, copies of the presentation, because I had a presentation to give to you then, and they received a call from PCO—it wasn't clear which part of PCO—saying that something was coming over for me and to wait.

My staff waited from 8 o'clock that night. Constantly, of course, as I was wont to do, I was checking what was happening, where it was from, what it was about, and no question, nothing at all. Then about 10 o'clock, the secretary of the commission was told that a package was coming from Patricia Hassard's office, which is senior personnel. I knew her. It arrived. He was there, opened it up and read it, and then he made sure I had it.

To say that it was a difficult evening is an understatement.

[Omar Alghabra, Liberal, Mississauga—Erindale, ON]

Were you provided any justification for that firing?

[Linda Keen]

I actually have in front of me the letter I received. It goes on for a number of pages. It has a lot of “whereases”. There's one “whereas” that is applicable, I believe, to the question:

Whereas, the President of the Canadian Nuclear Safety Commission failed to take the necessary initiative to address the crisis in a timely fashion using the means at her disposal, and failed to demonstrate the leadership expected by the Governor in Council;

That's the explanation I was given.