Canada: Audit Report Criticizes Transport Canada and National Energy Board

Feb 4th, 2012 | By | Category: Canada

According to an audit report released by the Office of the Auditor General of Canada in December 2011, Transport Canada has not designed and implemented the management practices needed to effectively monitor compliance with the Transportation of Dangerous Goods Act, 1992. Key audit findings included

  • Transport Canada lacks a consistent approach to planning and implementing its compliance activities. As a result, it cannot ensure that sites are inspected according to the highest risk.
  • Transport Canada has not ensured that corrective action has been taken on instances of non-compliance. More than half of the reviewed files contained notices of non-compliance. Of these files with identified deficiencies, seventy-three percent contained incomplete evidence or no evidence that corrective action had been taken.
  • Transport Canada has given only temporary, interim approval for nearly half of the emergency response assistance plans put in place by regulated organizations.

A 2006 internal audit identified similar deficiencies indicating that Transport Canada has failed to correct “some of the key weaknesses in its regulatory oversight practices.”


National Energy Board Findings

The National Energy Board also came under fire in the report. Although the National Energy Board was found to have a sound risk-based monitoring system that it uses to assess regulatory compliance associated with pipeline transport of oil, gas, and other dangerous products, “there is little indication that the Board takes steps to ensure that the identified deficiencies are corrected.”

As was the case with Transport Canada, deficiencies were identified in the National Energy Board’s review of emergency response plans.

The National Energy Board has not appropriately monitored whether regulated companies have prepared emergency procedures manuals according to established legislation, standards, and Board expectations. The emergency procedures manuals have yet to be reviewed for about 39 percent of companies. For those that have been reviewed, we noted that in almost all instances identified, deficiencies were not communicated to the regulated companies, and in only one case did the Board check to ensure that the deficiencies had been corrected. We have concluded that the Board’s oversight of companies’ emergency procedures manuals is deficient.


About the Audit

The audit was conducted by the Office of the Auditor General of Canada under the authority of the Auditor General Act to provide an independent, objective, and systematic assessment of how well government is managing its activities, responsibilities, and resources.

The objectives of this audit were to determine whether Transport Canada and the National Energy Board have designed and implemented management processes that would determine whether regulated organizations are complying with applicable legislation and standards and have conducted required emergency response planning.

The audit included interviews with key departmental officials, review of departmental policies and procedures associated with transport of dangerous products and emergency planning, and review of selected case files.


About Transport Canada

Transport Canada is responsible for the regulatory oversight of domestic and international shipping of dangerous goods via road, rail, air, and marine transportation. The Department’s mandate is set out in the Transportation of Dangerous Goods Act, 1992 and its regulations. These responsibilities include

  • developing and updating regulations
  • monitoring compliance with and enforcing the Act and regulations
  • reviewing and approving emergency response assistance plans
  • developing means of containment standards (the container, packaging, or any part of the means of transport that can be used to contain a dangerous good)
  • providing and developing inspector training (national, provincial, and territorial)
  • providing a 24-hour-a-day bilingual emergency advisory information service
  • attending and compiling data on accidents or incidents involving dangerous goods


About the National Energy Board

The National Energy Board is an independent federal agency established in 1959 to promote safety and security, environmental protection, and economic efficiency in regulating those pipelines that cross provincial, territorial, or national boundaries. The Board’s regulatory oversight applies to the entire life cycle of a pipeline (and related infrastructure) or facility project, including construction, operation, and abandonment. The Board regulates approximately 71,000 kilometers of pipelines in Canada.


Article Source: Office of the Auditor General of Canada

Photograph: Rideau Canal, Ottawa, Canada by Noriko Natsume, Ottawa, Ontario, Canada.


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