Audit of the Directorate of Nuclear Cycle and Facilities Regulation Inspection Processes

Executive summary

The Canadian Nuclear Safety Commission (CNSC) has a mandate, under the Nuclear Safety and Control Act (NSCA), to regulate all nuclear facilities and nuclear-related activities in Canada. Licensing and certification activities are in place to ultimately issue licences or certify persons and prescribed equipment that conduct nuclear-related activities.

The Directorate of Nuclear Cycle and Facilities Regulation (DNCFR) regulates, licenses and conducts compliance activities across the nuclear fuel cycle program and research reactors. Through its regulatory compliance program, DNCFR is responsible for planning, conducting and reporting on inspections within its areas of responsibilities.

The Office of the Auditor General of Canada (OAG) issued the 2016 Fall Reports of the Commissioner of the Environment and Sustainable Development: Report 1—Inspection of Nuclear Power Plants—Canadian Nuclear Safety Commission (the “OAG Audit Report”). The OAG Audit Report included five recommendations. The CNSC agreed with each of the OAG Audit Report recommendations and provided a response that detailed actions the CNSC had taken or intended to take to address the recommendations.

The following are the five recommendations outlined in the OAG audit report (Appendix B).

  • The CNSC should develop a systematic and risk-informed planning process that is well-documented and includes a five-year baseline inspection plan and the minimum required frequency and type of inspections (Recommendation 1, paragraph 1.33 of the OAG report)
  • The CNSC should develop detailed criteria to identify when to conduct Type I inspections (Recommendation 2, paragraph 1.35 of the OAG report)
  • The CNSC should ensure that its inspections follow its own procedures (Recommendation 3, paragraph 1.48 of the OAG report)
  • The CNSC should document its lessons learned in carrying out inspections (Recommendation 4, paragraph 1.50 of the OAG report)
  • The CNSC should issue timely final inspection reports (Recommendation 5, paragraph 1.61 of the OAG report)

In the summer of 2016, the CNSC President and Executive Committee instructed all non-nuclear power plant directorates (those not within the scope of the OAG audit) that conduct licensee inspections to address the OAG Audit Report recommendations as they relate to their inspection programs.

The objective of the audit was to determine the adequacy of the implementation of actions taken by DNCFR to respond to each of the five recommendations in the OAG Audit Report. There was limited opportunity to assess the implementation and effectiveness of some of DNCFR’s recently-completed actions. An assessment of the implementation and effectiveness of recently-completed actions will require a focused follow-up audit or specified audit procedures in one or two years, subject to Risk-Based Audit Plan priorities.

The audit considered DNCFR’s management action plans and deliverables that were a direct result of DNCFR’s assessment against the OAG Audit Report recommendations (Appendix C).

DNCFR completed a Self-Assessment of DNCFR Conduct of Inspection Procedure in June 2015 (the “2015 self-assessment”). In this self-assessment, DNCFR identified a need for management actions and deliverables related to the Directorate’s inspection processes. The scope and deliverables from DNCFR’s 2015 self-assessment coincided with the scope and subsequent release of the OAG Audit Report in July 2016. The audit considered management action plans and deliverables from the 2015 self-assessment in the context of the OAG Audit Report.

DNCFR has been making continuous improvements to its inspection operations since 2015 in response to its self-assessment and the OAG Audit Report recommendations. DNCFR addressed the need for improvement in conducting inspections (OAG Recommendation 3) and completing final inspection reports in a timely manner (OAG Recommendation 5), while the audit identified opportunities for further improvement in the planning of inspections (OAG Recommendation 1) and documenting lessons learned (OAG Recommendation 4). DNCFR is in the process of finalizing detailed criteria for Type I inspections (OAG Recommendation 2).

1) Develop a systematic and risk-informed planning process that is well documented and includes a five-year baseline inspection plan and the minimum required frequency and type of inspections (Recommendation 1, paragraph 1.33 of the OAG Audit Report)

DNCFR completed annual planning for compliance and risk-ranking, and it started documenting a strategy for short- and long-term planning of inspections that includes a ten-year baseline compliance plan and facility-specific compliance plans. It also assessed the need for more detailed work instructions on how to prepare 10-year baseline plans that include guidance on frequency of inspections, to be completed by December 2018. DNCFR was in the process of making plans to ensure its staffing level is appropriate to carry out the number of inspections required to verify compliance.

2) Develop detailed criteria to identify when to conduct Type I inspections (Recommendation 2, paragraph 1.35 of the OAG Audit Report)

As part of DNCFR’s draft annual program planning overview and instructions, plans include criteria for selecting an inspection type. The audit noted opportunities for improvements, such as defining the terminology used.

3) Ensure that inspections follow approved procedures (Recommendation 3, paragraph 1.48 of the OAG Audit Report)

The audit found that DNCFR’s directorate-level inspection guidance was updated appropriately and that both the CNSC corporate-level and DNCFR directorate-level inspection guidance was implemented.

4) Document lessons learned in carrying out inspections (Recommendation 4, paragraph 1.50 of the OAG Audit Report)

DNCFR determined that the existing CNSC corporate-level and DNCFR directorate-level processes sufficiently address lessons learned; therefore, no actions in this regard were taken as a direct result of the OAG Audit Report recommendations. The audit found that although the CNSC captured and shared lessons learned, there was an opportunity for DNCFR to formally document the lessons learned for each inspection.

5) Issue timely final inspection reports (Recommendation 5, paragraph 1.61 of the OAG Audit Report)

The audit found that the final inspection report service standard expectations were appropriately documented and communicated within DNCFR and that DNCFR management was monitoring the final inspection report performance against the service standard.

The Office of Audit and Ethics proposes that a focused audit be conducted or that specified audit procedures be followed to assess the implementation and effectiveness of the inspection processes in a year or two.

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Introduction

Background

The Canadian Nuclear Safety Commission (CNSC) has a mandate under the Nuclear Safety and Control Act (NSCA) to regulate the use of nuclear energy and materials to protect health, safety, security and the environment; implement Canada’s international commitments on the peaceful use of nuclear energy; and disseminate objective scientific, technical and regulatory information to the public. Licensing and certification activities are in place to ultimately issue licences or certify persons and prescribed equipment for nuclear-related activities.

The Directorate of Nuclear Cycle and Facilities Regulation (DNCFR) regulates licenses and conducts compliance activities across the nuclear fuel cycle program and research reactors. DNCFR plans and implements regulatory programs that provide oversight of the design, construction, operation, and decommissioning of facilities and activities across the fuel cycle facilities in a manner that protects the health and safety of workers and the public, security, and the environment. Through its regulatory compliance program, DNCFR is responsible for planning, conducting and reporting on inspections.

Inspections are one of the key tools the CNSC uses to determine whether a licensee is in compliance with the requirements of the regulatory framework. DNCFR conducts on-site regulatory inspections of licensees which culminate in final inspection reports to the licensees.

DNCFR had 31 active certified inspectors and 11 inspectors in training in 2018–19. The CNSC 2017–18 Annual Report indicates that DNCFR conducted 122 regulatory inspections in 2017–18 of licensees under the Directorate`s Nuclear Fuel Cycle Program, as follows:

  • 33 uranium mines and mills
  • 47 uranium and nuclear processing facilities
  • 42 nuclear waste management facilities and major decommissioning projects

The CNSC site inspection process is as follows:

  • Plan inspection – confirm scope, compile inspection criteria and review prior reports for outstanding issues
  • Notify licensee
  • Start field inspection and collect facts
  • Analyze inspection facts and develop preliminary findings
  • Communicate preliminary findings to licensee
  • Conduct final analysis
  • Prepare and issue final inspection report to licensee
  • Follow up on non-compliance

The Office of the Auditor General of Canada (OAG) issued the 2016 Fall Reports of the Commissioner of the Environment and Sustainable Development: Report 1—Inspection of Nuclear Power Plants—Canadian Nuclear Safety Commission (the “OAG Audit Report”). The OAG Audit Report focuses on whether the CNSC adequately managed its site inspections of Canadian nuclear power plants to confirm that the environment and the health, safety, and security of Canadians were being protected. More specifically, the OAG audit examined whether the CNSC adequately planned for and carried out site inspections of nuclear power plants. The OAG audit also examined whether the CNSC applied enforcement measures to ensure that the deficiencies it identified were corrected and made compliant with regulatory and licence requirements. The OAG audit focused on the CNSC’s management of its site inspections and not on the overall safety of nuclear power plants in Canada.

The OAG Audit Report included five recommendations relating to three areas of audit findings, namely planning inspections, conducting inspections, and enforcing compliance with regulatory and licence requirements (appendix B). The CNSC agreed with each of the OAG Audit Report recommendations and provided a response detailing the actions the CNSC had taken or intended to take to address the findings.

Authority

The audit of the management of inspection processes (non-nuclear power plants – Phase I of the DPRR’s inspection processes) is under CNSC authority and is included in its Risk-Based Audit Plan for the 2018–19 to 2020–21 fiscal years.

In the summer of 2016, the CNSC President and Executive Committee instructed all non-nuclear power plant directorates that conduct licensee inspections (i.e., directorates that did not come under the scope of the OAG audit) to address the OAG Audit Report recommendations as they relate to their inspection processes.

Audit objective, scope and approach

The objective of the audit was to determine the adequacy of the actions the DNCFR took to respond to each of the five recommendations in the OAG Audit Report. There was limited opportunity to assess the implementation and effectiveness of some actions recently completed by DNCFR. An assessment of implementation and effectiveness of recently completed actions will require a focused follow-up audit or specified audit procedures in a year or two, subject to Risk-Based Audit Plan priorities. The audit focused on management’s assessment, response and implementation of actions taken to address the OAG Audit report recommendations, and not the effectiveness of the inspection processes.

The audit scope included DNCFR’s Self-Assessment of DNCFR Conduct of Inspection Procedure, completed in June 2015 (the “2015 self-assessment”). The OAG Audit Report was subsequently released in July 2016. The scope of this audit considered management action plans and deliverables from the 2015 self-assessment in the context of the OAG Audit Report in addition to DNCFR’s management action plans and its subsequent assessment that was a direct result of the OAG Audit Report recommendations (Appendix C). The audit considered information from DNCFR’s management action plans and deliverables from the 2015 self-assessment up to the end of September 2018.

The audit approach included but was not limited to the following:

  • Conduct interviews with key stakeholders including senior management and staff
  • Review and analyze documentation on DNCFR’s self-assessment related to the OAG Audit Report recommendations

Statement of conformance

The audit approach was conducted in conformance with the Internal Auditing Standards for the Government of Canada and was supported by the Office of Audit and Ethics through its quality assurance and improvement program.

Acknowledgement

The Office of Audit and Ethics would like to acknowledge and thank management and staff for their support throughout the conduct of this audit.

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Audit observations and recommendations

In its assessment of the OAG Audit Report recommendations, DNCFR defined the OAG’s objectives (Appendix C) based on the OAG Audit Report. DNCFR identified a need for management action regarding several of the OAG Audit Report recommendations, as detailed below.

1) Develop a systematic and risk-informed planning process that is well documented and includes a five-year baseline inspection plan and the minimum required frequency and type of inspections (Recommendation 1, paragraph 1.33 of the OAG Audit Report)

DNCFR identified a need for management action regarding the OAG Audit Report recommendation to develop a systematic and risk-informed planning process for inspections. The assessment built on the recommendations in DNCFR’s 2015 self-assessment, in which DNCFR identified the need for a systematic, management-driven approach for short- and long-term planning of baseline inspections, including 10-year baseline plans for compliance.

DNCFR determined that its workforce plans, coupled with its draft guidance on using the risk-informed strategy for developing and implementing the 10-year baseline compliance and facility-specific plans, provided the framework for ensuring appropriate resources are available for oversight activities. DNCFR determined that the 10-year baseline plans will establish the minimum number and type of inspections required to verify compliance in each safety and control area.

The audit found that DNCFR developed deliverables related to risk-informed inspection planning in 2017 and that it published its Risk-Informed Baseline Compliance Process for DNCFR Licensed Facilities and Activities and Criteria for Risk Ranking DNCFR Licensed Facilities in 2018. The audit found that DNCFR started implementing 10-year baseline plans that included a 10-year baseline compliance plan, facility-specific compliance plans and details on inspections. DNCFR also identified the need for more detailed work instructions on how to prepare a 10-year baseline compliance plan and facility-specific compliance plans that included details on the development, nature, timing and frequency of Type I and Type II inspections.

DNCFR planned to complete the detailed work instructions by December 2018. The instructions will be used by DNCFR to update, prepare and implement a 10-year baseline compliance plan and facility-specific compliance plans in the 2019–20 fiscal year.

The audit included a review of the deliverables developed in 2018 and found that DNCFR’s 10-year baseline inspection planning had begun for individual licensees. These plans outlined the number of Type II inspections to be conducted, by safety and control area, over the next 10 years. In addition, facility-specific 10-year plans were developed across all facilities. The audit found that the draft overview guidance for verifying compliance indicated that Type I inspections were considered to be a reactive compliance verification activity and when required, scheduled in facility-specific plans; on this basis, DNCFR was not planning to include Type I inspections in the 10-year baseline inspection plan.

The audit found that annual regulatory activity planning for each facility drives human resources plans for staffing inspections. The audit found that DNCFR completed workforce plans in April 2018 on staffing compliance activities. The workforce plans consisted of short-term (three-year) action plans and a long-term future workforce profile (including drivers up to the year 2028) that include human resources details at a division level within the Directorate. The workforce planning took into consideration Directorate drivers, key factors, internal and external risks and major licencing activities; however, the level of detail in the workforce planning did not include inspection-related activities.

DNCFR management indicated that baseline compliance inspections and facility-specific plans will be prepared based on a 10-year planning cycle, whereas plans for specific inspection activities will be conducted on an annual basis. DNCFR management indicated that the risk-informed annual plans will link the workforce plans with the 10-year baseline compliance and facility-specific plans, where specific inspections are planned and tracked to completion as part of the Directorate’s in-year performance monitoring. Further, DNCFR management indicated that the level of detail in the Directorate’s resource planning did not include inspection-related activities.

DNCFR planned to staff inspections in the 10-year baseline compliance plan and facility-specific plans on an annual basis and in conjunction with the workforce plan, using the Directorate’s risk-informed planning guidance. DNCFR management planned for in-year monitoring of inspections and the related resources as a means of ensuring the appropriate number and level of staff to carry out the number of inspections required to verify compliance.

Conclusion

DNCFR assessed a gap in the Directorate’s inspection planning process and developed plans to address the gap, including completion of annual planning for compliance and risk-ranking, planning instructions for staff to be completed by December 2018 and long-term inspection plans for licensees to be implemented for the 2018 –19 fiscal year. The Office of Audit and Ethics proposes that a focused audit be conducted or specified audit procedures be followed to assess the implementation and effectiveness of the inspection planning process in a year or two.

Recommendation 1

It is recommended that the Director General of DNCFR ensures that the Directorate:

  • completes its instructions on how to prepare a 10-year baseline compliance plan and facility-specific plans by December 2018
  • implements its 10-year baseline compliance plan and facility-specific plans starting in the 2019 –20 fiscal year

Management response and action plan

The Director General of DNCFR agrees with this recommendation. DNCFR will:

  • develop management system documentation on how to develop 10-year baseline compliance plans across all nuclear fuel cycle facilities, and activities will be completed by end of December 2018
  • develop and maintain a tracking sheet for all 10-year baseline inspection plans outlining the start of implementation in the 2019 –20 fiscal year

Target completion date: December 2018 and April 2019, respectively

(See appendix D: Audit recommendations and management action plans)

2) Develop detailed criteria to identify when to conduct Type I inspections (Recommendation 2, paragraph 1.35 of the OAG Audit Report)

In its assessment of the OAG Audit Report recommendations, DNCFR determined that it needed to define criteria for Type I and Type II inspections in its compliance planning processes and in detailed planning instructions.

DNCFR had planned to define the criteria used to determine the types of compliance verification activities in the Directorate’s annual program planning overview, which is scheduled to be completed by December 2018. Given the timing of these deliverables, it was not possible to determine whether the procedures were fully implemented.

The draft planning overview includes the criteria for conducting Type I and Type II inspections. The following is an excerpt from DNCFR’s draft program planning overview:

“Type I inspections are considered to be a reactive compliance verification activity and when required, included in facility specific plans.

Criteria that would trigger the need for a Type I inspection typically include:

  • A new licensing basis program
  • Significant changes to an existing licensing basis program
  • Systemic failures within a licensing basis program changing the manner in which a program is implemented or administrated

Criteria that would trigger the need for a reactive Type II inspection typically include:

  • Changes to an existing licensing basis program that may affect the program outputs or outcomes
  • Significant or repeated items of non-compliance
  • Uncertainty or regulatory concerns stemming from observations or findings from other compliance verification activities, unplanned event examination or reported operational information”

The purpose of this description is to provide a common understanding of the basis for selecting a Type I or Type II inspection. The audit noted that using the above criteria makes it difficult to determine the inspection type that should be selected. The audit noted opportunities to add more comprehensive definitions in the criteria. The criteria above contain phrases such as “significant changes” and “systemic failures” that should be defined in detail. 

Conclusion

DNCFR had draft versions of deliverables that included criteria for selecting an inspection type; it has an opportunity to further clarify terms used in the definition of the criteria to ensure the consistent selection of inspection type. Given that the draft deliverables were to be completed by December 2018, it was not possible to determine whether the criteria were implemented. The Office of Audit and Ethics proposes that a focused audit be conducted or specified audit procedures be followed to assess the implementation and effectiveness of the inspection planning process in a year or two.

3) Ensure that inspections follow approved procedures (Recommendation 3, paragraph 1.48 of the OAG Audit Report)

DNCFR’s 2015 self-assessment included a recommendation concerning guidance on conducting inspections. DNCFR developed management action plans and implemented deliverables related to the 2015 self-assessment inspection guidance recommendation. The OAG Audit Report was released later, in July 2016.

In its subsequent assessment of the OAG Audit Report recommendations, DNCFR defined the OAG objectives (Appendix C). DNCFR determined that the CNSC’s existing corporate-level inspection guidance was sufficient to mitigate risks associated with compliance criteria and document retention; however, DNCFR identified a gap in compliance criteria and document retention guidance in the directorate-level guidance.

The audit found that management action plans were developed to incorporate compliance criteria and document retention guidance into the inspection guidance that was approved by senior management. The audit found that DNCFR sponsored the DNCFR Conduct of Inspections Working Group created to consider changes to inspection guides, practices and work instructions across the CNSC. Management published updates to the CNSC’s Overview of Conducting an Inspection corporate-level process guidance to establish a common understanding of the inspection process, to be used by CNSC staff who manage and participate in the inspections. The audit found that DNCFR contributed to updates to this corporate-level inspection process guidance and developed directorate-level inspection guidance with input from and collaboration with DNCFR staff.

The audit found that DNCFR updated the inspection guidance in response to the 2015 self-assessment recommendation. Management updated the CNSC corporate-level and DNCFR directorate-level inspection guidance to incorporate document retention expectations. Further, DNCFR directorate-level inspection guidance was updated to include compliance criteria in response to the OAG Audit Report recommendation.

The audit included an examination of inspection-related documentation from a judgment sample of eight inspections (two from each DNCFR division). For all eight (100%) of the inspections sampled, the documentation used to plan, conduct and report on the inspection was consistent with the most current, approved guidance and templates. Based on the implementation of guidance and an examination of inspection-related documentation, DNCFR adequately implemented a process to ensure that inspections followed approved procedures, at a level of detail appropriate to the Directorate.

Conclusion

DNCFR adequately addressed the OAG Audit Report recommendation to ensure that inspections follow approved procedures.

4) Document lessons learned in carrying out inspections (Recommendation 4, paragraph 1.50 of the OAG Audit Report)

DNCFR 2015 self-assessment included a recommendation for DNCFR staff to capture and contribute to inspection practices, and it included action items related to lessons learned. DNCFR developed a management action plan and implemented the deliverable related to the 2015 self-assessment lessons-learned recommendation.

In its subsequent assessment of the OAG Audit Report recommendations, DNCFR determined that the CNSC’s existing corporate-level inspection process guidance and DNCFR directorate-level processes were sufficient to mitigate risks associated with lessons learned to an acceptably low level; therefore, no actions in this regard were taken as a direct result of the OAG Audit Report recommendations.

DNCFR management provided inspection process guides used by the Directorate to illustrate the process to ensure lessons learned were captured and shared. The content of the inspection guidance was appropriate at both the CNSC corporate level and at DNCFR directorate level. The audit found that DNCFR inspectors were also active members of the CNSC’s inspector community, a platform used for communicating relevant inspection and compliance information between inspectors across the CNSC.

The audit found that DNCFR developed an evergreen Summary of Good Practices that was used for capturing future inspection practices in response to the 2015 self-assessment recommendation. The audit did not find a link between individual inspections and the Summary of Good Practices. The audit also found that the CNSC corporate-level inspection process guidance and DNCFR directorate-level inspection guidance included expectations regarding lessons learned, including the need to document them. The audit also found that lessons learned were being shared between DNCFR and the broader inspector community.

The audit found that DNCFR staff were using the inspection process guidance, at a level of detail appropriate for the Directorate; however, there was no evidence that DNCFR formally documented and shared the lessons learned. The audit included an examination of inspection-related documentation from a judgment sample of eight inspections (two from each DNCFR division). The inspection-related documentation for all eight (100%) did not include any record of the lessons learned.

Conclusion

DNCFR identified the need for a lessons-learned process as part of its 2015 self-assessment. DNCFR managed lessons learned by capturing and sharing its Summary of Good Practices for inspections and was active in the CNSC inspector community. DNCFR   addressed the gap in the Directorate’s inspection process guidance; however, there was still an opportunity for DNCFR to formally document lessons learned from each inspection, in keeping with the OAG Audit Report recommendation.

Recommendation 2

It is recommended that the Director General of DNCFR design a process to formally document the lessons learned from each inspection

Management response and action plan

The Director General of DNCFR agrees with this recommendation. DNCFR will:

  • create a core working group to look at best practices across the Directorate for documenting and sharing the inspection lessons learned
  • establish a Directorate-wide mechanism/process by which each division in DNCFR documents and shares the inspection lessons learned

Target completion date: December 2019

(See appendix D: Audit recommendations and management action plans)

5) Issue timely final inspection reports (Recommendation 5, paragraph 1.61 of the OAG Audit Report)

DNCFR’s 2015 self-assessment included a recommendation to document the service standard for issuing inspection reports. DNCFR developed management action plans and implemented deliverables related to the service standard recommendation in the 2015 self-assessment inspection report.

In its subsequent assessment of the OAG Audit Report recommendations, DNCFR determined that the CNSC corporate-level inspection process guidance and DNCFR directorate-level inspection processes were sufficient to mitigate risks associated with the timeliness of final inspection reports to an acceptably low level; therefore, DNCFR did not take any actions in this regard as a direct result of the OAG Audit Report recommendations.

DNCFR management provided the inspection process guides, and dashboard and Directorate performance reports the Directorate uses to illustrate the process for ensuring the timeliness of DNCFR’s final inspection reports. The audit examined the CNSC’s Overview of Conducting an Inspection process guidance and found that the content provided an appropriate level of inspection guidance at a corporate level.

The audit also examined DNCFR’s How to: Conduct DNCFR Inspections which indicated that final inspection reports must be issued within 60 working days of the inspection. The audit found that the content provided an appropriate level of inspection guidance at a directorate level. An examination of a judgment sample of DNCFR dashboard reports and the Directorate performance report found that the reports included metrics related to the timeliness of final inspection reports.

The audit found that the final inspection report service standard was embedded in the DNCFR inspection report template. The audit also found that inspection guidance at the CNSC corporate level and DNCFR directorate level included expectations regarding the timing of inspection reporting.

The audit found that the service standard expectations for final inspection reports were communicated within DNCFR and that the service standard guidance on final inspection reports was being used by DNCFR staff, at a level of detail appropriate for the Directorate. The audit included an examination of inspection-related documentation from a judgment sample of eight inspections (two from each DNCFR division). In all eight (100%) of the inspections sampled, the time to issue the final inspection report was accurately reported. Based on the implementation of guidance and the examination of inspection-related documentation, the service standard deliverable was implemented by DNCFR.

Conclusion

DNCFR adequately addressed the OAG Audit Report recommendation to issue timely final inspection reports.

Overall conclusion

The audit found that DNCFR responded to each of the five recommendations in the OAG Audit Report. DNCFR developed management action plans and deliverables in response to self-assessed gaps, and the full implementation of deliverables will ensure an adequate response.

The audit identified opportunities for further improvements in the process for planning inspections, including resource planning, and ensuring that justification for the selection is adequately documented. DNCFR is in the process of finalizing detailed criteria for Type I inspections.

1) Develop a systematic and risk-informed planning process that is well documented and includes a five-year baseline inspection plan and the minimum required frequency and type of inspections (Recommendation 1, paragraph 1.33 of the OAG Audit Report)

DNCFR completed annual planning for compliance and risk ranking, and it was in the process of developing planning instructions for staff, to be completed by December 2018, and planning long-term inspection plans for licensees, to be implemented in 2018 –19. Given the timing of these deliverables, it was not possible to determine whether the procedures were fully implemented.

2) Develop detailed criteria to identify when to conduct Type I inspections (Recommendation 2, paragraph 1.35 of the OAG Audit Report)

One of DNCFR’s deliverables was to define criteria for selecting an inspection type by December 2018. Given the timing of these deliverables, it was not possible to determine whether the procedures were fully implemented.

3) Ensure that inspections follow approved procedures (Recommendation 3, paragraph 1.48 of the OAG Audit Report)

DNCFR adequately addressed the OAG Audit Report recommendation to ensure that inspections follow approved procedures.

4) Document lessons learned in carrying out inspections (Recommendation 4, paragraph 1.50 of the OAG Audit Report)

DNCFR managed the lessons-learned process and updated inspection guidance. DNCFR had an opportunity to formally document the lessons learned from each inspection, in keeping with the OAG Audit Report recommendation.

5) Issue timely final inspection reports (Recommendation 5, paragraph 1.61 of the OAG Audit Report)

DNCFR adequately addressed the OAG Audit Report recommendation to issue timely final inspection reports.

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Acronyms

The following table presents acronyms used in this document.

CESD

Commissioner of the Environment and Sustainable Development

CNSC

Canadian Nuclear Safety Commission

DAC

Departmental Audit Committee

DNCFR

Directorate of Nuclear Cycle and Facilities Regulation

FY

Fiscal Year

NSCA

Nuclear Safety and Control Act

OAG

Office of the Auditor General of Canada

OAE

Office of Audit and Ethics

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Appendix A: Lines of enquiry and audit criteria

The OAE used both OAG recommendations as the basis for the criteria in its audit.

1. Line of Enquiry 1 – Assess the adequacy of DNCFR deliverables related to the OAG Audit Report recommendations that have been implemented.

Audit criteria

  • 1.1 DNCFR has adequate, formally approved and communicated management action plan deliverables in response to the OAG Audit Report recommendations.
  • 1.2 DNCFR staff are using the management action plan deliverables.

Line of Enquiry 2 – To the extent that deliverables related to the OAG Audit Report recommendations have not been implemented, assess the adequacy, completeness and timeliness of DNCFR plans to respond to the OAG Audit Report recommendations.

Audit criteria

  • 2.1 DNCFR has detailed, specific objectives and plans to respond to the OAG Audit Report recommendations.
  • 2.2 DNCFR monitors the implementation of management action plans and takes corrective action, as necessary.

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Appendix B: OAG Audit Report recommendations

The following table is an excerpt from the findings and recommendations in the OAG Audit Report. The number(s) in the table indicate the paragraph where each recommendation appears in the OAG Audit Report.

Findings Recommendations

Planning inspections

The Canadian Nuclear Safety Commission could not show that it had an adequate, systematic, risk-informed process for planning site inspections at nuclear power plants.

1.33 The Canadian Nuclear Safety Commission should develop and implement a well-documented planning process for site inspections of nuclear power plants that can demonstrate that the process is systematic and risk-informed. This should include determining the minimum required frequency and type of inspections needed to verify compliance, updating the five-year baseline inspection plan, and assessing whether it is assigning the appropriate number and levels of staff to carry out the number of inspections required to verify compliance.

1.35 The Canadian Nuclear Safety Commission should develop detailed criteria to help it identify when to conduct Type I inspections.

Conducting inspections

The Canadian Nuclear Safety Commission did not always follow its own inspection procedures.

1.48 The Canadian Nuclear Safety Commission should ensure that its inspections follow its own procedures. This requires that it develop approved inspection guides with appropriate criteria before conducting inspections to assess that nuclear power plants are complying with applicable regulatory and licence requirements. The Canadian Nuclear Safety Commission should also clearly explain to its staff how to decide which documents should be considered transitory and which documents should be retained after they issue inspection reports.

1.50 The Canadian Nuclear Safety Commission should ensure that it documents lessons learned in carrying out its inspections, to help it make continuous improvements to its inspection practices.

Enforcing compliance with regulatory and licence requirements

The Canadian Nuclear Safety Commission followed up to confirm that nuclear power plants corrected compliance violations it identified, but did not always issue final reports on time.

1.61 The Canadian Nuclear Safety Commission should determine why it does not issue timely final inspection reports and decide whether it needs to make any changes to its processes or standards.

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Appendix C: OAG objectives

In its assessment of the OAG Audit Report recommendations, DNCFR defined OAG objectives, as follows.

OAG Audit Report recommendation OAG objectives as defined by DNCFR

Document a systematic and risk-informed planning process for inspections (Recommendation 1, paragraph 1.33 of the OAG Audit Report)

  • a documented process on the annual risk-informed plan
  • resources required to implement inspections according to risk

Develop detailed criteria to identify when to conduct Type I inspections (Recommendation 2, paragraph 1.35 of the OAG Audit Report)

  • a documented criteria on when to conduct specific types of compliance verification activities

Ensure that inspections follow approved procedures (Recommendation 3, paragraph 1.48 of the OAG Audit Report)

  • formal/approved/up-to-date instructions and tools for staff to conduct inspections (including documented compliance criteria prior to an inspection)
  • clear guidance on the retention of records collected during compliance verification

Document lessons learned from inspections for continuous improvement (Recommendation 4, paragraph 1.50 of the OAG Audit Report)

DNCFR did not define OAG objectives in relation to this OAG Audit Report recommendation

Ensure final inspection reports are issued to licensee are timely (Recommendation 5, paragraph 1.61 of the OAG Audit Report)

DNCFR did not define OAG objectives in relation to this OAG Audit Report recommendation

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Appendix D: Audit recommendations and management action plans

The following table presents recommendations made in audit observations and recommendations and the associated management action plans provided by DNCFR.

Recommendations Management response and action plans Target completion date

1. It is recommended that the Director General of DNCFR:

  • complete instructions on how to prepare 10-year baseline compliance plan and facility-specific plans  by December 2018
  • implement its 10-year baseline compliance plan and facility-specific plans starting in 2019–20.

Management agrees.

  • Management system documentation capturing how to develop 10-year baseline compliance plans across all nuclear fuel cycle facilities and activities will be completed by end of December 2018.
  • Develop and maintain a tracking sheet for all 10-year baseline inspection plans, outlining the start of implementation is 2019–20.

 

December 2018

 

 

 

April 2019

2. It is recommended that the Director General design a process to formally document lessons learned from each inspection.

Management agrees.

Strike a core working group to look at best practices across the directorate for how inspection lessons learned are documented and shared.

Establish a directorate-wide mechanism/process by which each division in DNCFR documents and shares inspection lessons learned.

December 2019

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