The Office Australian Safety and Compensation Council

Submission to Australian Productivity Commission

Review of Standards and Accreditation

April 2006

Executive Summary
The role of the Australian Safety and Compensation Council (ASCC) is to provide leadership and coordination for national efforts to prevent workplace death, injury and disease and to improve national worker’s compensation arrangements, rehabilitation and return to work of injured employees. The Office of the Australian Safety and Compensation Council (The Office of the ASCC) is the body responsible for the development of national OHS standards and codes. The ASCC provides policy advice to the Workplace Relations Ministers’ Council on OHS and workers’ compensation arrangements to deliver nationally consistent frameworks. 
The submission outlines the MOU which existed between NOHSC and Standards Australia, and the current and proposed relationship between the work of the Office of ASCC and Standards Australia. It also outlines Labour Ministers Council (LMC) decisions regarding referencing of Australian Standards in national OHS standards and codes.

Previously, NOHSC national standards and codes of practice heavily referenced Australian Standards. When the NOHSC national standards and codes were adopted as legislation by states and territviously managed under a Memorandum of Understanding (MoU).

Attachment 1 – NOHSC and Standards Australia MoU

On 7 February 2005, the functions of NOHSC were transferred to the Department of Employment and Workplace Relations (DEWR). With the establishment of the ASCC the application of the MoU between the Commonwealth and Standards Australia has been examined for use by the Office of the Australian Safety and Compensation Council (The Office of ASCC).

There were a number of differences between the NOHSC with Standards Australia MoU and the Commonwealth MoU with Standards Australia. The key differences between the NOHSC and the Commonwealth MoU’s include:
•	providing and maintaining a register of all Australian Standards referenced in Australian legislative instruments. This assists the ASCC in its revision of standards and codes of practice;
•	giving priority to request for work that the Commonwealth considers necessary; and
•	informing the Commonwealth of any contracts of service or other financial agreements related to standards development entered into with Commonwealth departments or agencies;

The Commonwealth MoU was to be revised in August 2004. Currently the Department of Industry Tourism and Resources (DITR) manages the Commonwealth MoU. The review was postponed after a request from Standards Australia. At this time, Standards Australia was in the process of floating SAI Global Limited (the commercial arm of the organisation) on the Australian Stock Exchange and needed extra time to settle in to the new environment it would create.

Relationship of the Office of ASCC and Standards Australia

Under the NOHSC MoU, NOHSC and Standards Australia developed two joint standards, the National Standard for Safe Working in Confined Spaces [NOHSC:1009(1994) and AS 2865-1995] and the Workplace Injury and Disease Recording Standard AS 1885.1-1990. The National Standard for Safe Working in Confined Spaces [NOHSC:1009(1994) and AS 2865-1995] has been revised by Standards Australia as AS 2865-2001. Standards Australia are currently reviewing AS 2865-2001 and AS 1885.1-1990 and while the revised standards will not be joint standards it is anticipated that the Office of ASCC and the ASCC will achieve significant input into the development of these standards by membership on the drafting committees.

The Office of ASCC has formalised a relationship with Standards Australia. A senior executive from the office is a member of the Environment, Safety and Material Standards Sector Board. Sector Boards, through their membership, provide a link to industry and other organisations, and also provide a basis for setting priorities in standardisation. 

The Office of ASCC continues to facilitate an information network to inform Standards Australia committees of an ASCC position on particular standards of relevance.

Labour Ministers’ Council and Workplace Relations Ministers’ Council Decisions

In response to the proliferation of referencing  Australian Standards in legislation, the excessive compliance costs on small business and the perceived negative impact on competition, the Labour Ministers’ Council (LMC) 58 (May 1997) reinforced the voluntary status of Australian Standards by agreeing not to incorporate Australian Standards into legislation by reference. The decision from LMC 58 Ministers recognised that:
•	Standards Australia standards were intended to be voluntary;
•	noted the decision of States and Territories not to incorporate Standards Australia standards in legislation by reference; and
•	existing references in legislation or other mandatory instruments would be reviewed.

However, after an assessment of the extent of Australian Standards referenced in national OHS legislation, and consideration of the de facto legislative status conferred upon Australian Standards by the courts, LMC 60 (November 1998) agreed to a policy of progressive elimination of legislative referencing of Australian Standards, except for definitional purposes or for prescribed methods of measurement. This amended decision recognised:
•	continued use of Australian Standards in the workplace;
•	continued development of Australian Standards in response to market demands;
•	importance of Australian Standards in providing certainty for employers discharging duty of care, especially in relation to design and manufacturing; and that
•	Australian Standards can prescribe minimum effective solutions in certain circumstances.

States and territories have implemented these recommendations over time, reducing reliance on Australian Standards in their principle OHS legislation, instead referring to them in their codes of practice.

Future Work

Stakeholders have had difficulties in trying to obtain recognition of international standards or standards from other countries, where there is a requirement to demonstrate compliance with an Australian Standard. There is no consideration for the comparability/compatibility and mutual recognition (and acceptance) of Australian Standards and standards from recognised international standard setting organisations, such as the International Organisation for Standardisation (ISO), and other overseas standard setting bodies. 

Essential Safety Outcomes

In response to these concerns, the ASCC has agreed that the concept of Essential Safety Outcomes (ESOs) be utilised/tested in the plant standard review in an attempt to minimise the reliance on Australian Standards in national standards as minimum OHS requirements, particularly in relation to plant i.e. machinery and equipment. A similar concept is currently in use in European directives. This approach is be developed as it will offer:
•	the opportunity for the use of deem-to-comply solutions;
•	contain clear and identifiable outcomes; and
•	wherever possible, contain performance based requirements and identifiable outcomes rather than prescriptive requirements. 

ESOs are intended to operate as the minimum legislated requirement that must be achieved, and as such, provide a “checklist” against technical standards (including Australian Standards) to be assessed. Those standards assessed as acceptable could then be used as “deemed-to-comply” specifications for the particular area of interest. This model could enable the acceptance of relevant technical standards from other countries. It would also provide a framework within which Standards Australia could develop or review its existing suites of technical design standards. 

The ESOs are primarily intended to cover design and manufacture although the concept could be extended further than this. The challenge is to identify sufficiently specific technical specifications, or end points. More specific end points would make it easier to compare other standards to the required outcomes specified in the ESOs. The standards could be listed in a schedule, or in a code of practice as providing an acceptable (or deemed) method of meeting the ESOs. This could also allow designers and manufacturers a choice, to either use the recognised standards to achieve the ESOs, or to use an alternative approach that can be demonstrated to meet the ESOs.

Australia has reasonably consistent legislative requirements for plant however these are not always interpreted in the same manner and as a result there is not a high degree of uniformity in how plant design approvals and high risk plant registrations are implemented in the States and Territories. 

Incorporating ESOs into national standards, rather than referring to Australian Standards, will improve compatibility with relevant international standards or practices, thereby avoiding unnecessary restrictions to international trade and minimising impact on competition.

The Office of ASCC views this model as one way of clearly identifying the different roles of the Australian Government and Standards Australia for design, manufacture and similar specifications in the OHS area.

This approach is consistent with the Council of Australian Governments principles of good regulation (Principles and Guidelines for National Standard Setting and Regulatory Action by Ministerial Councils and Standard Setting Bodies, June 2004).

The continuing role of Standards Australia to develop and co-ordinate technical standards is supported as they would continue to serve a useful purpose in the model outlined above.

Conformance Assessment

Conformance assessment (CA) is the demonstration of compliance with a standard, which gives a level of certainty to industry about whether when something does/does not comply. Conformance assessment generally provides benefits for manufacturers and suppliers, consumers and government regulators, as well as for international trade in general.  A robust CA process provides the necessary assurances that plant and machinery have been designed and manufactured to meet standards that provide appropriate health and safety outcomes.

A conformity assessment can be defined as a process that documents and demonstrates that plant has been designed and manufactured in accordance with the relevant requirements in an accepted technical standard or specification. Currently in Australia, the regulated safety conformity assessment for high hazard plant focuses on design verification. There are no broad regulatory  requirements to cover conformity generally associated with manufacturing  or fabrication (although individual technical standards may impose its own criteria for this)

Currently in Australia, each OHS jurisdiction has slightly different requirements for plant design registration, which are different again from conformance processes in place in other countries. There will be increasing acceptance in the future of a broader range of technical design and manufacture standards for plant supplied and used in Australia. Many of these will already have been required to comply with overseas conformance requirements. There is therefore a requirement to develop a broader conformance assessment process for Australia.
The Office of ASCC views the setting of a framework and requirements for such a conformance process as the role of government.

There is a suite of Australian Standards on conformity assessment that could be used to set the basis for a new conformity process for plant in Australia. These standards mirror the equivalent ISO standard. If Australian processes recognise CA undertaken in accordance with the ISO standards assessments, with documentary evidence, that have been carried out in other countries that follow the same process may be acceptable. This should allow the movement of overseas manufactured plant to occur with minimal regulatory restrictions in place.

In revising the conformance assessment process in Australia, the extent of assessment will need to be identified and the relevant processes established. Generally for low risk plant, self assessment may be acceptable with the option to bring in a formal assessor if necessary. However, for high risk plant, a more formal, auditable process may need to be put in place. Whatever activity is performed with the plant it is important that reasonable steps are taken to ensure that safety is not compromised at any stages of the plant life. 

Standards Australia could have roles in developing the detail of such a conformance process and accrediting organisations to undertake conformity assessments.

Role further to ESOs and Conformance  

Australian Standards currently develop documents that could be suitable for use as a code of practice under OHS legislation i.e. documents that provide practical guidance to industry on how to undertake work safely. A number of Australian Standards are already used in this context by industry (such as AS/NZS 2865:2001 : Safe working in a confined space and AS 1940:2004 - The storage and handling of flammable and combustible liquids).

There may be scope to increase the range of documents that are suitable for this purpose. This would require a development of processes that would meet the requirements of the ASCC and therefore require close liaison with Standards Australia,

One issue with this approach is the cost of published Australian Standards. This is viewed as an impediment to small business uptake of these documents, particularly those of a general nature that would be used widely by industry.

Standards Australia would, however, only be one of many potential organisations that could be considered as appropriate to develop documents of this nature.

Attachment 1
MEMORANDUM OF UNDERSTANDING BETWEEN NATIONAL OCCUPATIONAL HEALTH AND SAFETY COMMISSION AND STANDARDS AUSTRALIA
This Memorandum of Understanding is made on 
BETWEEN 
The NATIONAL OCCUPATIONAL HEALTH AND SAFETY COMMISSION a body corporate established by the National Occupational Health and Safety Commission Act 1985 (hereinafter called “the National Commission”) of the one part; 
AND 
STANDARDS AUSTRALIA INTERNATIONAL LIMITED ACN 087 326 690, a company limited by guarantee and incorporated in the State of New South Wales (hereinafter called “Standards Australia”) of the other part. 
WHEREAS: 
The memorandum of understanding between the National Commission and Standards Australia is intended to facilitate communication, and a complementary and constructive relationship between the two organisations in their work in developing, reviewing and updating occupational health and safety (OHS) standards. 
PURPOSE 
Agreements at the Workplace Relations Ministers’ Council in 1998 indicate that in relation to 
OHS standards the Council is changing the roles of the National Commission and Australian 
Standards so that: 
a. there will be less emphasis on national standards development through the National Commission; 
b. subject to Workplace Relations Minister’s Council agreement, the National Commission will develop and up-date a nationally consistent standards framework; 
c. referencing of Standards Australia OHS standards in OHS legislation (that is, Acts or Regulations) will be eliminated on a progressive basis; and 
d. within this context, the major practical applications of the Memorandum of Understanding will be to Australian Standards that are (or are intended to be): 
- referenced in OHS codes of practice and/or guidance material; 
- taken up (in their entirety) as OHS codes of practice; 
- used as OHS guidance material; and 
- referred to in the OHS Acts and regulations administered by the OHS Authorities. 
NOW IT IS HEREBY AGREED AS FOLLOWS: 
ARTICLE 1: Definitions Or OCCUPATIONAL HEALTH AND SAFETY STANDARDS 
1.1 For the purposes of the memorandum of understanding, “OHS standards” are defined as occupational health and safety standards or codes of practice developed by the National Commission and OHS-related standards developed by Standards Australia. Use of the terms “standard” and “OHS-related standard” is not intended to suggest that the standards referred to have mandatory status. 
1.2 Australian Standard means a standard issued by or under the authority of Standards Australia. ‘Australian Standards’ is a registered trademark of Standards Australia. Australian Standards are consensus based, voluntary documents with which compliance is not mandatory unless incorporated into law or called up in contractual arrangements. 
1.3 National Standard means a standard declared by the National Commission under s.38 (1) of the National Occupational Health and Safety Commission Act 1985 (Cwlth). National Standards are suitable for adoption by Commonwealth, State and Territory governments and may be adopted as mandatory documents. The application of a National Standard in any particular State, Territory or the Commonwealth is the prerogative of that State, Territory or the Commonwealth. 
1.4 Approved Code of Practice means a code, standard, rule, specification or provision which has been adopted or incorporated by reference at the Commonwealth or State and Territory levels of government. The principal OHS Act in the Commonwealth, State and Territory provides powers to declare approved codes of practice, which give practical advice and guidance to employers, self-employed persons and employees on how to comply with the general obligations set out in Acts and Regulations. 
ARTICLE 2: OBJECTIVES 
2.1 The objectives of the memorandum of understanding are to ensure: 
2.1.1 a mutually agreed understanding of the respective roles and responsibilities of the National Commission and Standards Australia in relation to the development of OHS standards; 
2.1.2 compatibility between the OHS standards developed by the National Commission and those developed by Standards Australia; 
2.1.3 minimization of duplication and overlap in the OHS standards developed by the National Commission and Standards Australia; and 
2.1.4 facilitation of a constructive working relationship between the National Commission and Standards Australia. 
ARTICLE 3: GENERAL PRINCIPLES 
3.1 The memorandum of understanding between the National Commission and Standards 
Australia is intended to be fully consistent with the memorandum of understanding 
between the Commonwealth of Australia and Standards Australia signed on 25 
February 1998. 
3.2 The National Commission will develop National Standards that establish the national occupational health and safety objectives and performance criteria (refer to Article 1 .3). Australian Standards will form part of the hierarchy of advisory material available to assist industry to meet the requirements of mandatory standards (refer to Article 1.2). However, Australian Standards should not duplicate guidance material developed by the National Commission as codes of practice or other forms of guidance material. 
3.3 The general understanding of the parties is that, for a given OHS issue, NOHSC will develop and coordinate OHS policy and strategy and the relevant Australian Standards will deal with associated methods of measurement and tools to assist industry to meet its OHS responsibilities. 
ARTICLE 4: UNDERTAKINGS OF STANDARDS AUSTRALIA 
4.1 Decisions as to what plant, substance, activity or process regulatory agencies will prohibit, license, accept, approve, accredit or certify should not be addressed in OHS- related Australian standards. 
4.2 In the preparation of new and the revision of existing Australian Standards, Standards 
Australia will have regard to the general principles (Article 3) set out in the 
Memorandum of Understanding between the Commonwealth of Australia and 
Standards Australia. 
4.3 The process for developing Australian Standards for OHS will be outlined in the Standards Australia, Standardization Guide No. 17.1 — Drafting of Standards Which May Be Referenced Under Occupational Health and Safety Legislation as revised from time to time. 
4.4 Standards Australia will, wherever possible, give priority to proposals for revision of existing Australian Standards that NOHSC considers necessary for the successful attainment of national OHS objectives. 
4.5 Standards Australia will advise and consult with NOHSC on new or proposed Australian Standards which may impact on attainment of national OHS objectives. 
4.6 Standards Australia will ensure that NOHSC is invited to be represented on any technical committee dealing with issues related to OHS, and will advise all of its technical committees of the need for requirements in Australian Standards to be consistent with the requirements of the national OHS framework. 
4.7 Where NOHSC seeks the development of Australian Standards referenced by OHS regulations, Standards Australia will endeavor to draft them in a form suitable for referencing in NOHSC standards and to legislation or regulations, and that they represent a minimum effective solution. 
4.8 An active public comment process for Australian Standards will be promoted. This will include seeking comment from relevant OHS authorities, industry and unions. 
4.9 When Australian Standards are revised, the new edition should consider arrangements for the transition from the requirements of the existing standard to the new standard. 
ARTICLE 5: UNDERTAKINGS OF THE NATIONAL COMMISSION 
5.1 The National Commission will inform Standards Australia of decisions (including those of Workplace Relations Ministers’ Council where appropriate) regarding: 
5.1.1 development of new OHS standards (including codes of practice); 
5.1.2 the review of current OHS standards (including codes of practice);and 
5.1.3 preparation of guidance material related to the National Commission standards. 
5.2 The National Commission will advise Standards Australia of the program for reviewing current OHS standards. This will include advice on which OHS-related Australian Standards are referenced in the National Standards (and Codes of Practice and other relevant guidance material) being reviewed. 
5.3 On occasion, the National Commission may advise Standards Australia that new 
Australian Standards may be needed or revisions may be needed to Australian 
Standard/s referenced in the National Commission standards or codes of practice. 
(Such revisions would be coordinated through the process described at Article 0.) 
5.4 NOHSC will, to the extent appropriate, participate on Standards Sector Boards, Standards Coordination Groups and Technical Committees of Standards Australia. 
5.5 Any future National Commission standards and codes of practice will be developed in accordance with the COAG Principles and Guidelines For National Standards Setting and Regulatory Action.
ARTICLE 6: JOINT UNDERTAKINGS 
6.1 Officer to Officer level meetings between the National Commission Office and Standards Australia will be held to provide briefings and exchange information on developments on OHS standards related issues, including decisions taken to develop or review standards. 
6.2 Both parties will undertake to refer issues of concern through their relevant committee structures for resolution. 
6.3 The Terms of Reference for committees developing and reviewing OHS related Australian Standards will establish clear parameters for the scope and processes for projects. Should a committee be unable to reach agreement on issues, those issues will be referred to the relevant committee structures of the National Commission and Standards Australia for resolution. 
ARTICLE 7: DURATION
7.1 This memorandum has effect for a period of five (5) years from the date of its execution. 
7.2 After four (4) years from the date of its execution the parties will review the performance of this memorandum.
ARTICLE 8: VARIATION 
8.1 This memorandum of understanding may be varied by agreement of the parties and any such variation will be set out in writing and signed by both parties. 
ARTICLE 9: TERMINATION 
9.1 The National Commission or Standards Australia may at any time, upon giving twelve calendar months notice in writing to the other party of its intention so to do, terminate this memorandum of understanding.
ARTICLE 10: NOTICES 
10.1 Any notice to be served pursuant to this Memorandum of Understanding is to be sent by registered post or fax to the addresses set out below or in each case to such other place of business as may be notified from time to time by either party. 
10.1.1 For the National Commission:
The Chief Executive 
GPO Box 58, 
Sydney 2001.
10.1.2 For Standards Australia: 
Chief Executive 
Standards Australia 
P0 Box 1055 
Strathfield NSW 2135 
IN WITNESS WHEREOF the Parties have executed this Memoranda 
above written. AND date first 
SIGNED for and on behalf of the 
STANDARDS AUSTRALIA INTERNATIONAL 
LIMITED 
)
) Chairman 
In the presence of 
SIGNED for and on behalf of the 
NATIONAL OCCUPATIONAL HEALTH 
SAFETY COMMISSION