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President’s Message

Proud achievements throughout a challenging year

As I reflect on an active and challenging year of work here at the Canadian Nuclear Safety Commission (CNSC), I am particularly proud of the way in which all staff have continued to uphold the most fundamental principles of our organization – namely, to protect the health, safety and security of Canadians and the environment and to implement Canada’s international obligations respecting the peaceful uses of nuclear energy.

This Departmental Performance Report highlights the many important achievements realized in 2009–10. All our licensed facilities and activities continue to operate safely in compliance with our regulatory requirements. Furthermore, the CNSC closely monitored and provided regulatory oversight of the Atomic Energy of Canada Limited (AECL) repair work on the National Research Universal (NRU) reactor at Chalk River; continued to disseminate objective and scientific information to keep the public informed about nuclear safety; and provided a licence for dealing with the long-term project to clean up historic waste in Port Hope.

On the international side, the report also highlights an independent assessment of Canada’s nuclear regulatory framework conducted under the International Atomic Energy Agency (IAEA) that determined that our framework is mature and well-established, and that the CNSC does an effective job in carrying out its role as Canada’s nuclear regulator. This is high praise and reflects our skilled workforce’s commitment to carrying out the CNSC’s mandate on a daily basis.

In the 2010 Budget, the Government of Canada took steps to further improve the regulatory review process for large energy projects. In this vein, the CNSC will continue to work on implementing an improved regulatory framework and a more efficient regulatory oversight and on ensuring the timely and meaningful engagement of the public, stakeholders and Aboriginal peoples in the review of major nuclear projects. We will continue to strive for excellence in our core activities, as well as make significant strides in our commitment to ongoing improvements, in the clarity of our regulatory expectations, in our capacity to respond to any situation, and in our communications with the public. As we strive towards our vision of being the best nuclear regulator in the world, I continue to seek the valuable input from the CNSC Audit Committee and count on the oversight function that they provide.

Obviously, safety will continue to be the number one priority at the core of everything that we do!

With respect,

[ Original version signed by Michael Binder ]

Michael Binder
President
The Canadian Nuclear Safety Commission

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Section I: CNSC Overview

1.1 Summary Information

Raison d’être and Responsibilities

In 1946, Parliament passed the Atomic Energy Control Act (AECA), creating the Atomic Energy Control Board, and provided it with the power to regulate all nuclear activities related to the development and use of atomic energy in Canada.

Over half a century later, in May 2000, the Nuclear Safety and Control Act (NSCA) came into effect and established the Canadian Nuclear Safety Commission (CNSC) as a successor to the Atomic Energy Control Board.

The CNSC is an independent regulatory agency with quasi-judicial powers responsible for regulating all nuclear-related activities and substances in Canada.

Our Vision

To be the best nuclear regulator in the world.

Our Mission

Regulating nuclear activities to protect the health, safety and security of Canadians and the environment, and implementing Canada's international commitments on the peaceful use of nuclear energy.

Our Mandate

Under the NSCA, the CNSC achieves its mission through the following areas:

• Regulating the development, production and use of nuclear energy in Canada, as well as the possession and transportation of nuclear substances;
• Implementing measures on the non-proliferation of nuclear weapons and nuclear explosive devices;
• Providing objective scientific, technical and regulatory information about the activities of the CNSC.

In this context, the CNSC:

• Is responsible for complying with the Government of Canada’s December 2007 Directive to the Canadian Nuclear Safety Commission Regarding the Health of Canadians. This Directive requires the CNSC, when regulating the production, possession and use of nuclear substances, to take into account the health of those Canadians who, for medical purposes, depend on nuclear substances produced by nuclear reactors;
• Administers the Nuclear Liability Act and, as a Responsible Authority under the Canadian Environmental Assessment Act, carries out environmental assessments (EAs) for nuclear projects in accordance with this legislation;
• Is Canada’s authority with respect to nuclear safeguards as set out in the Agreement Between the Government of Canada and the International Atomic Energy Agency for the Application of Safeguards in Connection with the Treaty on the Non-Proliferation of Nuclear Weapons.

The Commission Tribunal has up to seven permanent members, appointed by the Governor in Council, and is supported by a workforce of approximately 850 employees across Canada. The President of the CNSC is a permanent full-time Tribunal member, while other members may be appointed to serve full- or part-time. Temporary members can also be appointed by the Governor in Council, as required.

The Commission Tribunal is a quasi-judicial administrative tribunal and court of record and makes independent, fair and transparent decisions on the licensing of nuclear-related activities, establishes legally binding regulations, and sets regulatory policy direction on matters relating to health, safety, nuclear security and the environment. With respect to licensing matters related to major nuclear facilities, the Tribunal considers applicant proposals, recommendations of CNSC personnel, and stakeholder views before making its decisions. In order to promote openness and transparency, the Tribunal conducts its business to the greatest extent possible in public hearings and meetings and, where appropriate, in communities affected by the decision at hand. Commission Tribunal hearings are conducted in a public forum approximately 10 times per year, and decisions are released within 30 business days after the closing of the hearings.

The organizational chart for the CNSC:

Program Activity Architecture

The following illustrates the CNSC’s program activities and program sub-activities, which support a single strategic outcome:

1.2 Summary of Performance

2009-10 Financial Resources ($ thousands)

Planned Spending	Total Authorities	Actual Spending
142,731	144,855	138,352

2009–10 Human Resources Full-time Equivalents (FTEs) (FTEs)

Planned	Actual	Difference
840	841	1

Note:

The 2009–10 Planned Spending amount included costs paid for by other government departments (OGDs) for accommodations, health insurance and other expenditures totalling $11.2 million. In accordance with Treasury Board requirements, these costs are not included in the Total Authorities or Actual Spending and will be excluded from Planned Spending in future years. Explanations of variance in resource levels can be found below following the table “Performance Summary by Program Activity”.

Performance Summary

The CNSC works to achieve its strategic outcome through four program activities: Regulatory Framework, Licensing and Certification, Compliance, and Internal Services. In 2009–10 the CNSC successfully completed planned activities and met all performance targets with the exception of one. Further details regarding the links between the CNSC’s strategic outcome, program activities, expected results and 2009–10 performance can be found in Section II.

Performance Summary by Program Activity

($ thousands)

Program Activity	2008-09 Actual Spending	2009-101				Alignment to Government of Canada Outcomes
		Main Estimates	Planned Spending	Total Authorities	Actual Spending
Regulatory Framework	27,462	28,761	28,761	30,148	24,345	Social Affairs - Safe and Secure Communities
Licensing and Certification	27,189	31,272	31,272	29,539	25,045
Compliance	25,567	40,605	40,605	40,366	39,724
Internal Services	37,805	42,093	42,093	44,802	49,238
Total	118,023	142,731	142,731	144,855	138,352

¹Commencing in the 2009–10 Estimates cycle, the resources for the Internal Services program activity are displayed separately from other program activities; they are no longer distributed among the remaining program activities, as was the case in previous Main Estimates. This has affected the comparability of spending and FTE information by program activity between fiscal years.

Note:
The above table indicates that total authorities used between 2008–09 ($118 million) and 2009–10 ($138 million) have grown by $20 million. Reasons for this growth are: increase in regulatory licensing and compliance work performed in 2009–10 where funding was sourced from industry licence fees; costs associated with the re-fit of office space and the implementation of an information system; the conduct of regulatory activities planned for 2008–09 but delayed and conducted in 2009–10; funding received under the Economic Action Plan to relocate and upgrade the CNSC laboratory and for the payment of economic increases on employee compensation.

Contribution of Priorities to Strategic Outcome

Although work has slowed on major nuclear projects, the Government of Canada remains committed to establishing Canada as a clean-energy superpower. For the CNSC, this means ensuring a state of readiness and continuing to develop guidance for new applications while protecting the health, safety and security of Canadians and the environment, and helping Canada meet its international obligations for nuclear safety.

During the past fiscal year, the CNSC accomplished a wide range of key activities under four priorities: Commitments to ongoing improvements, Clarity of requirements, Capacity for action, and Communications. These four priorities cross-cut the CNSC’s program activities and their associated commitments supported progress towards the CNSC’s strategic outcome.

Commitments to Ongoing Improvements

In addition to conducting core licensing and compliance activities, this priority includes work undertaken to complete Harmonized Plan initiatives. (The Harmonized Plan brings all corporate-wide improvement initiatives under a single umbrella.) It also includes ensuring that the health of Canadians and the safety of facilities are central considerations in all licensing and compliance activities, through initiatives such as isotope contingency planning and assessing environmental concerns. This priority also encompasses corporate service level and policy improvements, including those identified through various audits.

Summary of 2009–10 achievements within this priority area:

• Compliance inspections: Issued five orders to licensees using nuclear substances and shut down the facility of one licensee using a radiation device.
• Made nearly 2,600 licensing decisions.
• There were approximately 20 environmental assessments (EAs) that were active throughout the year, including three that were completed:
  • Decision on Deloro Mine EA screening report
  • Decision on Port Granby low-level radioactive waste EA screening report
  • Decision on GE Hitachi EA screening report.
• Launched the U.S.-Canada Working Group on Medical Isotopes to minimize future shortages of these critical medical resources.
• The International Peer Review Committee found that Canada has a mature and well-established nuclear regulatory framework and that the CNSC protects the health, safety and security of Canadians and the environment (IAEA Integrated Regulatory Review Service mission).
• In the fall of 2009, the CNSC underwent its second Management Accountability Framework (MAF) assessment and the majority of observations were positive. For the 13 areas of management against which the CNSC was assessed, it received three “Strong” ratings, nine “Acceptable” ratings and one “Opportunity for improvement”. This represents a significant improvement over the last MAF assessment in 2006.
• Developed a mandatory training program for CNSC managers to ensure that they have the knowledge required to exercise their delegated authorities.

Clarity of Our Requirements

This priority includes creating broad awareness of the CNSC’s requirements stemming from the NSCA among licensees, vendors of nuclear technology, and proponents, whether for refurbishments and life-extensions or new projects (such as design reviews, review guides, joint review panels). Its other goals are revitalizing the CNSC’s regulatory framework; updating regulatory documents and guidance, with particular attention to guidance for licence applications and environmental assessments (EAs); engaging government partners through the Major Projects Management Office; and continuing the implementation of the protocol for NRU licence renewal.

Summary of 2009–10 achievements within this priority area:

• Obtained commitments from all major nuclear licensees to disclose high-quality and timely information to the public on facility performance and unplanned events.
• Updated the Protocol for National Research Universal (NRU) licensing activities. The protocol guides the CNSC in assessing the continued operation of the NRU reactor beyond the current licence period of October 31, 2011.
• Provided pre-project vendor design reviews to verify whether nuclear power plant designs respect Canadian safety principles and criteria.
• Updated the CNSC’s regulatory framework and posted regulatory and guidance documents for consultation on the CNSC Web site to ensure public engagement. A comprehensive list of documents can be found at nuclearsafety.gc.ca.

Capacity for Action

This priority includes maintaining and renewing the CNSC’s workforce to ensure sufficient knowledge and skills to fulfill our mandate. This means continuing efforts to make the CNSC an employer of choice through focussing on renewal and retention initiatives. The organization is strengthening its planning and operational processes, and focusing on information management progress in key areas such as compliance reporting, inspection tracking/resolution and financial management.

Summary of 2009–10 achievements within this priority area:

• Conducted leading research to build knowledge in such areas as aging reactors, management of uranium mine waste rock and mill tailings, and the effects of tritium on health.
• Continued with modernization of the CNSC’s research laboratory to bring it up to international standards and increase its capability.
• Introduced a new program to standardize the ways in which CNSC inspectors are trained and qualified.
• Recruited expert personnel to establish an optimal workforce.

Communications

This priority includes work to strengthen communications with the CNSC’s licensees, the public, stakeholders, Aboriginal peoples, international counterparts, other government departments and central agencies, in accordance with our goal of being the best nuclear regulator in the world and our mandate to disseminate objective scientific, technical and regulatory information to the public concerning our regulatory activities.

Summary of 2009–10 achievements within this priority area:

• Commission Tribunal: Held 11 public hearings and meetings, which included 145 interveners, and 32 abridged hearings.
• Developed the Codification of Current Practice: CNSC Commitment to Aboriginal Consultation. This document lays out the CNSC’s approach to consulting with Aboriginal peoples.
• Conducted outreach initiatives in communities across the country to discuss how the CNSC regulates areas such as uranium mines and mills, the licensing process for new nuclear projects, and the CNSC’s role in regulating the nuclear industry.
• Posted multiple documents online, including presentations by high-level CNSC personnel, technical papers, articles, studies and fact sheets, in efforts to disseminate objective information. Documents are available at nuclearsafety.gc.ca.

Risk Analysis

As part of its ongoing organizational risk management, the Management Committee is responsible for reviewing risks and ensuring mitigation strategies are in place. Each fall, during the CNSC’s strategic planning sessions, a review of risks is undertaken to assess any potential impacts on planning. Identified risks are monitored throughout the year at each Quarterly Corporate Performance Review.

Over the past several fiscal years, the CNSC, in response to anticipated growth in the nuclear sector, put in place a recruitment strategy to ensure that the organization had the necessary staff complement to regulate new projects; the organization did not want to be at risk of causing delays to new projects. The CNSC was successful in hiring the employees needed and in 2009–10 the CNSC shifted from recruitment to a strategy of retention to retain the organization’s highly skilled workforce of 850 employees.

The CNSC has now fully implemented its Revenue Spending Authority, which makes its source of funds dependent on the level of regulatory oversight of fee-paying licensees. In 2009–10 licence applications for new power reactors were withdrawn, forcing the CNSC to adjust plans to ensure funding of all regulatory activity. The organization was able to accomplish this because it had developed planning scenarios to facilitate a fair and reasonable reallocation of efforts and costs in the event that the risk of major project stoppages materialized. The organization also undertook an initiative to simplify its costing regime and provide more certainty to licensees; improvements are being implemented in fiscal year 2010–11.

The CNSC received a total of $13 million in incremental resources through Budgets 2006 and 2008 to address regulatory workload pressures and forecasted growth associated with fee-exempt and nuclear security activities. These incremental funds are set to expire at the end of fiscal year 2010–11, and the CNSC is working with the government to ensure that it is resourced to fulfill its mandate.  

Expenditure Profile – Funding of Operations

The CNSC’s workload, and therefore its resource requirements, are largely driven by the demand for licensing and regulatory oversight of Canada’s nuclear industry and by Canada’s international commitments respecting nuclear safety, security and non-proliferation.

Revenue spending authority was fully implemented in 2009–10. The CNSC’s cost-recovered activities are funded through the fees collected from industry for approximately 70% of the total CNSC budget. This authority provides a sustainable and timely funding regime to address the rapid changes in regulatory oversight workload associated with the Canadian nuclear industry.

The CNSC is also funded through an annual appropriation, from Parliament, representing approximately 30% of the total budget. The regulations state that some licensees, such as hospitals and universities, are exempt from paying fees as these entities exist for the public good. In addition, fees are not charged for activities that result from the CNSC’s obligations that do not provide a direct benefit to identifiable licensees. These include activities with respect to Canada’s international obligations (including the non-proliferation of nuclear weapons), public responsibilities such as emergency management and public information programs, and updating of the NSCA and associated regulations.

In 2009–10 the total parliamentary and revenue spending authorities totalled $144.9 million. Of that amount a total of $138.4 million was used to fund the CNSC’s cost of operations, leaving $6.5 million in unused authority of which $1.7 million is related to revenue received in advance.

In 2009, the CNSC conducted a strategic review of the funding, relevance and performance of its entire program spending to ensure results and value for money. The results of this strategic review were submitted to Treasury Board in the fall of 2009, and the reallocation proposals have received the support of Treasury Board Ministers. The results of this review will be reflected in future reporting to Parliament.

The figure above illustrates the CNSC’s spending trend from 2007–08 to 2009–10.

Voted and Statutory Items
($ thousands)

Vote # or Statutory Item (S)	Truncated Vote or Statutory Wording	2007-08 Actual Spending	2008-09 Actual Spending	2009-10 Main Estimates	2009-10 Actual Spending
15	Program expenditures	89,870	91,002	40,670	46,282
(S)	Contributions to employee benefit plans	9,975	11,533	4,464	13,978
(S)	Expenditures pursuant to paragraph 29.1(1) of the Financial Administration Act	-	15,488	97,597	78,092
Total		99,845	118,023	142,731	138,352

This table presents resources that have been voted to the CNSC by Parliament. It should be noted that Parliament approves the voted funding whereas the statutory information is provided for information purposes. Explanation of variance in resource levels can be found in the table “Performance Summary by Program Activity”.

Canada’s Economic Action Plan (CEAP)

Through the 2009 Budget, $250 million was made available to departments and agencies over two fiscal years to address deferred maintenance of federal laboratories. The focus was on laboratories that contribute to core regulatory responsibilities of the government, such as health and safety.

The CNSC was allocated a total of $3 million under CEAP to improve its laboratory capabilities, bringing them up to international standards. In 2009–10 the CNSC received and spent $2 million to renovate new laboratory space, purchase new equipment and decommission the existing laboratory.

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