Corporate governance

 

The Director is accountable for the overall legal and financial performance
of the Scheme and ensures that the objectives of the Act are met.
The Secretary of the Department of Health and Ageing (DoHA) provides
staff to the Director, NICNAS to carry out the functions of the Act under
Section 91(3) of the Act. The employment framework for NICNAS staff
is the Public Service Act 1999. The DoHA Certified Agreement 2004-07
and the Department's governance policies and practices cover staff.
These include the establishment and maintenance of appropriate ethical
standards under the Australian Public Service (APS) Values and Code of
Conduct, compliance with Australian Government Freedom of Information
(FOI), Privacy and Occupational Health and Safety legislation, the Australian
Government Disability Strategy and workplace diversity policy.

The operations of the Scheme are governed by the Industrial Chemicals
(Notification and Assessment ) Act 1989 (the Act) and a number of
corporate documents that facilitate transparent, sustainable and open
delivery of the regulation of industrial chemicals. NICNAS's cost recovery
arrangements and performance targets are detailed in the DoHA PBS.
The NICNAS PBS are supported by the NICNAS Strategic Corporate Plan
2002-05, the NICNAS Operational Plan 2004-05 and the NICNAS Service
Charter 2002-05.

The Act stipulates mandatory performance standards such as assessment
timeframes, public reporting of prescribed information and annual reporting
requirements. Performance reporting against the Act, corporate plan and
operational plan is undertaken quarterly and is detailed in the Operational
Performance section of this report, as is the outcome of the annual
customer survey of key stakeholders. Compliance with mandatory reporting
requirements under the Act is detailed at Appendix 01.

The financial framework for the governance of NICNAS is established in the
Financial Management and Accountability Act 1997 (the FMA Act). Integrity
in financial reporting is through internal audit arrangements via a Service
Level Agreement (SLA) with the DoHA. These are reported in the DoHA
Annual Report 2004-05 where NICNAS's performance against governance
policies and practices can also be found.

NICNAS internal policies and practices also cover the physical security and
protection of commercial-in-confidence information it receives from industry
in support of chemical notifications.

In 2004-05, NICNAS received two formal complaints on its operations as
compared to two in 2003-04, one in 2002-03, seven in 2001-02 and two
in 2000-01. One complaint related to the publication of a report on the
NICNAS website that contained reference to confidential business
information. The other related to the provision of an assessment report
containing third party data to the notifier. NICNAS engaged the services
of an independent consultant, Tress Cox Lawyers, to investigate the first
complaint and a breach was found to have occurred. As a result we have
made significant changes and improvements to NICNAS's internal
procedures that were recommended. The second complaint was found
to be baseless. However as part of the investigation of the matter, a
number of procedural improvements were identified and implemented.
Both complaints were resolved to the satisfaction of the complainants.

Three non-statutory bodies provide advice to the Director on the NICNAS
budgetary process, community information needs and the operation of
the Scheme. These are: the NICNAS Industry Government Consultative
Committee (IGCC), the NICNAS Community Engagement Forum (CEF)
and the NICNAS/States and Territories Memorandum of Understanding
(MOU) Group.

These bodies remained critical to NICNAS's success in continuing to
build effective partnerships to deliver whole-of-government achievement.
By having well informed and actively engaged stakeholders, NICNAS
was greatly assisted in meeting all its key targets in 2004-05.

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Industry Government Consultative Committee

Industry Government
Consultative Committee
Seated (L to R):

Mr Nick Munafo (PACIA), Ms Sylvia Kidziak AM
(ACCI), Mr Tom Fisher (ASCC)
Standing (L to R): Mr Nick Miller (Secretariat, NICNAS) Mr Mark Hyman (DEH), Mr Geoff MacAlpine (ACCORD) Dr Margaret Hartley (Chair,
NICNAS), Mr Wil Antioch (DITR), Ms Bronwyn Capanna (ACCORD), Mr Michael Hambrook (APMF), Ms Margaret Donnan (PACIA)
Absent: Mr Shane Baker (DITR), Mr Terry Slater (TGA)

 


 

Appointed by the Minister, the IGCC oversees the efficient and effective
utilisation of NICNAS resources and the Scheme's operational performance.
IGCC membership, terms of reference and meeting details for 2004-05 are
at Appendix 02.

The IGCC met two times during 2004-05 with the focus of activities on the
implementation of key reform initiatives, detailed in the Reform Initiatives
section of this report. The Committee also determined the level of NICNAS
fees and charges for 2005-06 and endorsed the NICNAS Operational Plan
2005-06 and NICNAS 2005-06 Budget.

Other key outcomes from the IGCC meetings in 2004-05 were:
the establishment of a NICNAS-Industry Working Group to consider and
   report to the Director, NICNAS on the re-engineering of certain New
   Chemicals administrative and other processes to address the trend
   noted by NICNAS of a reduced application quality by industry
a report on the substantial progress being made in the review of the
   Existing Chemicals Program, and
the sustained high-level of performance as noted in quarterly
   performance reports for NICNAS, where overall performance targets
   were reported to have been met or exceeded.
   IGCC members evaluated the efficiency and performance of the IGCC
   process and feedback indicated that papers were well prepared and
   received on time, and that the meetings were well focused, with plenty
   of time for discussion and listening, leading to workable solutions.

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Regulatory framework linkages and cooperative
arrangements

Community Engagement
Forum (L to R):

Dr Bro Sheffield-
Brotherton (environmental
interests), Ms Pamela Grassick and Ms Renata Musolino (worker health and safety interests), Assoc Prof Christopher Winder (public health interests), Dr Wafa El-Adhami (Acting Director,
NICNAS), Mr Griffin D'Costa
(Secretariat, NICNAS),
Ms Liz Hanna (public health interests)
Absent: Ms Jane Bremmer
(environmental interests),
Dr Margaret Hartley (Chair - Director, NICNAS

 

The establishment of the Community Engagement Forum (CEF) arose
from NICNAS's low regulatory concern chemicals (LRCC) reform initiative.
The LRCC Task Force recognised the advantages to NICNAS of maintaining
an ongoing dialogue with the public through the establishment of a formal
consultative mechanism and recommended the establishment of a
community-based forum.

The Forum was established to assist the NICNAS office improve public
access to chemical safety information, address aspects of the community's
right to know in relation to the control and use of industrial chemicals and
to enable interested people, organisations and key stakeholders to have
input into policy and decision-making processes.

The Parliamentary Secretary appoints members to the CEF. Full membership
lists, terms of reference and meeting details for 2004-05 are at Appendix 02.
The focus of activities this year was on finalising the Community
Engagement Charter. The CEF also supported NICNAS in a range
of initiatives including reviewing LRCC implementation issues, the review
of the Existing Chemical Program, and providing membership to technical
working groups for review and reform programs.

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States and Territories Memorandum
of Understanding Group

States and Territories
MOU Group
(L to R):

Mr Greg Balka
(Victoria), Mr Bob Graf
(NICNAS), Dr Joe Crea (South Australia), Mr Ian Graham (Tasmania), Dr Usha St George (New South Wales), Dr Jeff Langley (Western Australia), Dr Roshini Jayewardene (Chair, NICNAS), Dr David Grantham (Queensland), Mr Peter Haynes (representing ASCC -
observer), Lewis Norman
(Secretariat, NICNAS).
Absent: Steve Caldwell (NT), Mark Brown (ACT),
Dr Wafa El-Adhami (OCS -
Observer), Dr Graeme Barden (DEH - Observer).

 

The NICNAS States and Territories Memorandum of Understanding (MOU)
Group was established to facilitate the exchange of important information
relating to chemical safety and management in Australia between the
various levels of government. In 2004-05 the MOU group continued to
exemplify the ongoing cooperation that exists between NICNAS and other
government agencies, and it remains a key strategic alliance through which
enhanced compliance is achieved.

The MOU provides an effective interface through which compliance related
concerns are communicated and workshopped. Representatives from
the states and territories liase with other agencies in their respective
jurisdictions to assist in the integration of NICNAS recommendations
into health, safety and environmental controls applying to chemical usage.
The group also provides a mechanism to ensure NICNAS responds to the
needs of state and territory agencies responsible for the control of industrial
chemicals.

The issue of exchanging confidential/exempt information between
NICNAS and the Australian Government, state and territory authorities
was addressed during 2004-05 as part of the review of the MOU group's
efficiency and effectiveness. In response, NICNAS drafted Guidelines for
the exchange of confidential/exempt information between NICNAS and the
States and Territories. These guidelines outline appropriate arrangements
between the parties in relation to the exchange of exempt and confidential
information under the Act, and the storage and maintenance of the
information. The guidelines will be finalised in 2005-06.

The MOU group also provided a forum for consultation on reform programs
and other NICNAS activities, and in 2004-05 provided initial comments
on NICNAS initiatives such as the implementation of the Rotterdam
Convention, amendments to the Industrial Chemicals (Notification and
Assessment) Act 1989, and the Review of the Existing Chemicals Program.

Details of the group's two meetings for 2004-05, membership (which
includes representatives drawn from the OHS authorities of the various
states and territories, ASCC, DEH, OCS and NICNAS) and terms
of reference are at Appendix 02.

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External scrutiny

Administrative Appeals Tribunal

 
The Act specifies those decisions of the Minister or the Director, NICNAS
that may be taken before the Administrative Appeals Tribunal (AAT).
Appealable matters include decisions on confidentiality, inventory listing,
new and existing chemicals assessments and NICNAS Registration
decisions.
No applications were made to the AAT during 2004-05 (as in 2003-04 and
2002-03, and compared to four in 2001-02). The total number of appeals
against the Director's decisions since the introduction of the Scheme in
1990 is seven, with five withdrawn and two found in favour of NICNAS.

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Management of Human Resources

  At 30 June 2005, NICNAS employed 42 full-time equivalent (FTE) staff.
Of these, 30 are permanent employees and 12 are non-ongoing staff.
The staffing profile for NICNAS is shown at Appendix 03, where training and
development activities for NICNAS staff are also reported. A total of 171.25
days of formal training (approximately 4.7 days for each person, compared
to 6.0 in 2003-04) were undertaken in the year, including orientation
and induction training for new staff. Compulsory training in awareness
of Australian Public Service (APS) values continued for all new staff and was
offered to all existing staff. New staff also undertook compulsory customer
service training. NICNAS conducted four 'in house' seminars during
2004-05.

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Occupational Health and Safety (OHS)

  Three OHS inspections were undertaken at the Marrickville office during
2004-05, with no major health or safety issues identified within the
premises. Two OHS seminars were presented to staff during the year:

Safety at work, our first priority and OHS Legislation for Commonwealth
Employees (see Appendix 15 for details).

OHS information comprising a short OHS presentation followed by a tour
of the premises was provided to ten new staff members during the year.
All staff ergonomic requirements were met, including adjustments to chair
and monitor heights and distances, the supply of wrist rests, eye tests and
other OHS needs.

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Equity performance

 

NICNAS's mandate - to provide a national notification and assessment
scheme to protect the health of the public, workers and the environment
from the harmful effect of industrial chemicals - includes provision of
information on chemicals to workers, industry, the community and other
regulatory agencies. Chemical safety is promoted through a variety of
information items available free of charge from NICNAS and also available
on the website.

The Act requires the Director to publish all assessment reports prepared
by NICNAS, which also publishes brochures, safety information sheets,
chemical alerts and guidance notes on industrial chemicals. These
publications generally target the needs of the end user.
Public information on industrial chemicals introduced into Australia
is provided through the annual publication of specific information as required
under the Act. This includes new chemicals introduced under exemption
categories, current and previous Priority Existing Chemicals, chemicals that
require secondary notification and those that are the subject of low volume
permits. NICNAS was fully compliant with the Act in providing public
information in 2004-05.

The Industrial Chemicals (Notification and Assessment) Amendment
(Low Regulatory Concern Chemicals) Act 2004
introduced several
mechanisms through which information on industrial chemicals and their
introducers will be made public. For the first time since the inception of
the Scheme, the regulator will engage with the broader industrial chemicals
sector via mandatory NICNAS Registration of all introducers. In addition,
all new industrial chemicals introduced under exemptions must be reported
to NICNAS annually. This will become operational next year, with the first
reports due on 28 September 2005. Publication of statistics on this
information further enhances the transparency of industrial chemicals
regulation.
NICNAS utilises its existing advisory committee structure as a conduit for
information dissemination to the chemicals industry, the community and
Australian Government and state/territory agencies. In addition, NICNAS
routinely liaises with industry and industry associations, employer and
worker representatives and the public through the assessment process.

Extensive public consultation is undertaken on changes affecting the
Scheme. Anyone (including the public) can nominate existing chemicals
of health and/or environmental concern to NICNAS for priority review.
Any member of industry or the community can appeal the Director's
decisions under the Act through the AAT process.

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Financial Performance

 

NICNAS operates on a cost recovery basis. Cost recovery is achieved in two
ways: NICNAS Registration charges and fees, and fees and administrative
charges for new chemical assessments. In 2004-05 NICNAS Registration
monies funded the assessment of existing chemicals, client awareness and
education activities, 78 per cent of the costs of compliance activities and
the administration of Registration itself. The remaining 22 per cent of
compliance activities were funded by an appropriation from the Australian
Government under cost recovery policy arrangements.

NICNAS's financial services are purchased through a service level
agreement from the TGA. These administrative arrangements include the
provision of fraud control measures, disability and purchasing strategies,
and the management of human resources.

Total funds cost recovered from industry in 2004-05 were $6,812,744.
At 30 June 2005, the cash at bank total of $1,461,734 resulting from cost
recovered funds was available for carryover into 2005-06. The net surplus
this year mainly resulted from a significant increase in the number of
NICNAS registrations following the introduction of Tier 1 Registration in
September 2004. Additionally, cost savings were achieved by efficiently
managing the implementation of Tier 1 Registration.

The surplus was discussed with the Ministerial appointed NICNAS IGCC
who noted that the majority of these funds are committed to ensure the
wide range of legislated amendments to the Act can be fully implemented
in 2005-06 without increasing NICNAS Registration fees and charges.

Table 2 provides a summary of NICNAS's financial performance (accrual) for
the year. Auditing of NICNAS's financial performance is undertaken as part
of the TGA-wide auditing process, and is included in the financial
performance reporting in the DoHA Annual Report 2004-05.
 

  Table 2 NICNAS financial accrual overview 2004-05
 

 REVENUE

$'000

 

Assessments

1,795

NICNAS Registration 4,836  
Publication sales, industry education & research projects 50  
Interest 132  
Government subsidy 120  
Expenditure    
Salaries 3,137  
Administration 749  
Indirect overheads 1,612  
Surplus / (Deficit) 1,435  

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Ecologically Sustainable Development and
Environmental Performance

  NICNAS operates its chemical risk assessment activities to be consistent
with the Government's policy parameters of ecologically sustainable
development (ESD) as outlined in section 3A of the Environment Protection
and Biodiversity Conservation Act 1999. NICNAS ensures that ESD policy
is applied consistently in the assessment of environmental risk for individual
chemicals through cooperative partnership arrangements with the DEH,
who apply scientific principles and related ESD policy in environmental risk
assessment activities. Details of how the principles and practices of ESD
are applied to NICNAS risk assessment practice are found at Appendix 06.

NICNAS Registration
Please see Reform Initiatives section of this report.

Consultancies, Commissions and Discretionary Grants
NICNAS did not make any discretionary grants for 2004-05.
Please see Appendix 04 for consultancies commissioned.

Advertising and market research
Media advertising organisations used by NICNAS in 2004-05 are listed
at Appendix 05.

Freedom of information
NICNAS received no Freedom of Information requests in 2004-05.

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