Leader of the Opposition

STATEMENT BY BILL HAYDEN, MP

The attached submission is released for public

information.

As stated in the covering letter, the submission

Was prepared in close consultation with the.

Opposition spokesman on minerals and energy

matters, Paul Keating. .

If the Government genuinely wants to improve its

operations in the whole range of activities .  .

covered by this inquiry, it is essential that the

terms of reference be widened —  even, at this late

stage.  .

The reasons are spelled out in the submission and

are accepted by ..the great majority of those_wifh

no vested interest in these matters.

CANBERRA 7 May 1979.

Office of the - - . /

Leader of the Opposition ; ./ {

4 May 1979

The Secretary  AAEC Review Committee  National Energy Office  PO Box 5

CANBERRA 2600

.Dear Sir,

Enclosed with this letter is a submission to the  Review of Research and Development Activities of  the Australian Atomic Energy Commission.

This submission, a personal view on the activities  of the AAEC and changes which should take place in  the conduct of those activities, reflects the  general thinking about these matters within the  Australian Labor Party, and has been prepared in

closeÂ·..consultation with the Opposition spokesman  for Minerals and Energy,  the Hon Paul Keating, M P .

BILL HAYDEN, MP

Parliament House, Canberra. A.C.T. 2600

Submission to:

Australian Atomic Energy Commission

Review of Research, and Development Activities

by

.  BILL HAYDEN M.P.

LEADER OF THE OPPOSITION

4 MAY 1979

SUMMARY

1.  The terms of reference of the review of the activities of the  Australian Atomic Energy Commission are inadequate,  as they:

(i) predetermine the direction of the result of  the review, towards the retention of the AAEC in a  modified form as a national centre for energy research,  and prevent the consideration of alternative forms of

national energy research centres;

(ii) preclude thorough consideration of the commercial  activities of the AAEC, including the most appropriate  administrative arrangements for these activities and  their relationship to the AAEC's nuclear energy research  activities and facilities;

(iii) exclude consideration of the nuclear regulatory  and safeguards activities of the AAEC, and their  relationship with activites of the Australian Safeguards  Office and other agencies of government involved with  .  nuclear regulatory and safeguards activites..

2. The establishment of the AAEC, and its past and present  levels of funding reflect the political,  scientific and  social circumstances and beliefs of 1953; these circumstances

no longer prevail.

3. Recent criticisms of the AAEC have focussed on:

(i) its conflicting functions in both promoting and regulating nuclear activities;  .

(ii) its.past failures in attempts to develop and innovate  nuclear technologies:

(iii) the questionable quality of its research;

(iv) the excessive secrecy which has surrounded its work;

(v) its lack of mission.

4. The Atomic Energy Act, which established the AAEC and under  whose provisions the AAEC continues to operate, contains _  repressive and unnecessarily secretive provisions. It is an

inappropriate legislative basis for nuclear energy research  and development, and for the commercial operations of the  AAEC.

.-./2

5.  Consequently,  it is proposed that:

(i) current functions of the AAEC be divided; '  Â·  Â·  '  3

(ii) the Atomic Energy Act be repealed and be replaced by legislation to give effect to the following ~

proposals:

(a) an independent regulatory authority be established  to b e .responsible for nuclear-related environmental  protection, health, safety, security, safeguards and  other non-proliferation activities;

.  (b) a new government corporation be established to take over the present commercial activities  of the AAEC,. such as the. production and marketing  of radioisotopes;

(c) other functions currently being.performed by the  AAEC be performed as appropriate by a Nuclear  Science Authority, with, projects funded by a  National Fuel and Energy Commission consistent with

research and development priorities determined  ,  -  for a National energy policy, or other bodies.

f

Introduction

Ã¢ÂÂ¢1 . .

There are excellent grounds for conducting a thorough and  comprehensive inquiry into the Australian Atomic Energy  Commission (AAEC).

The AAEC has enjoyed a privileged position in Australian  scientific research.  Its annual budget (estd. 1978/79  expenditure approx.  $24 million) is second only to that  Of CSIRO among government technical bodies. In contrast to,

for example, the CSIRO, Bureau of Meteorology and Bureau  of Mineral Resources, its operations have to date not been  subjected to any Departmental or independent review or  investigation. -

The Australian Science and Technology Council (ASTEC) and  the National Energy Advisory Committee (NEAC) declined,  apparently without any government instruction, to make  any recommendations about changes in nuclear energy research,  almost exclusively the concern of the AAEC,.. in the course  of their reports on Australian energy research and development.

2 . Yet,  the AAEC has come under responsible but severe criticism  from several sources, and for a variety of reasons.

Ann Moyal, in a major study"*"of the Commission, concluded  as follows: .

"...the lesson of history is plain enough. Basically the  history of the Australian Atomic Energy Commission is an  object lesson in the problems and dangers of closed government..  .   there was insufficient, opportunity for public debate and '

little for assessment and meaningful comment among the  scientific and public communities.  Overall there was a disdain  for public accountability on the part of a major scientific  establishment."

3.  The Coombs Royal Commission on Australian Government Administration  suggested: .

"...there may well be a case for reconsidering the form, structure  and functions of the Australian Atomic Energy Commission. It was conceived under the influence of scientific, technological  and economic expectations which have changed dramatically

since its establishment. It seems that,  if consideration _  were being given now for the first time to creating such a  Commission, the scope of its research and other functions, the  division of responsibility between it, CSIRO, the Bureau of  Mineral Resources, defence science establishments, other government

science agencies,  universities and the private sector,  and the  structure of the Commission itself, would almost certainly be  different."

The comments cited above go right to the heart of the problems  associated with the AAEC.  The points they raise are  inadequately addressed by the terms of reference of the  current review. <

4 .

Origins o,f the AAEC and its Current Place in Australian Research

5. The political context of the AAEC's current operations differs  radically from that which gave rise to its formation.

In 1953, there was at least an implied bipartisan agreement  on the need to keep open Australia's options on acquiring  nuclear weapons.  Cold War fears of atomic espionage were  used to justify the severe security provisions of the Atomic  Energy Act, which gained both Liberal-Country Party Government  and Australian Labor Party Opposition support, and were to  apply to operations of the AAEC. .  ‘  '

Consequently, the Commission was established with the power  to research atomic energy for both industrial and military  purposes.

6 . There is now bipartisan agreement to reject the nuclear weapons  option. As a result,  at the very least,  the legislation  establishing the AAEC and under which it still largely performs

its functions, is now outdated. Â·

It was because the Atomic Energy Act could not be satisfactorily  modified that during 1978 the Opposition opposed outright  any amendments to the Act.

The legislation as it now stands explicitly provides for the  AAEC to engage in uranium mining for purely commercial purposes  (s.17(4)(aa)), yet it retains the provision that the Approved  Defence Projects Protection Act 1947 shall apply to all projects  performed by the AAEC (s.60).  .

In other words, the conflict between the incompatible, interests  of the AAEC has recently been compounded by the Government.

8 . .

There is also considerable well-founded community reservation  about even the industrial uses of atomic energy. Evidence to  the Ranger Uranium Environmental Inquiry and subsequent public .   opinion polls have demonstrated that fact. -

.  .  .  /3

9. More specifically,  the AAEC1s historic and present dominance  of Australia's energy research and development funding is  a matter of concern. .

.  3

According to a recent government survey,  $5,772 million Â· was spent, in Australia in 1976/77 on nuclear energy research. , This represented 21.5% of total energy research spending.

The AAEC accounted for the majority of the Commonwealth's Â·  $4,905 million nuclear expenditure.  .

However, these figures tend to substantially underestimate  the resources used on nuclear energy by the AAEC. For example,   the survey indicates a total AAEC. involvement of 152 man-years durinc  1976-77 i^ energy.  On the other hand,  in answer to a question  on notice from Mr Hayden,  the Minister indicated that in .

the same year 314.4 man-years were involved in AAEC research  programmes, of which 3.6 man-years were non-nuclear related.  According to the Minister, approx. 15% of the research  establishment's staff of 1070 (i.e.  160 people) is employed  on the uranium fuel cycle programme.

It would, thus, be more realistic to estimate the AAEC's  expenditure on nuclear energy-related research and development  - via its power and energy programme and its nuclear fuel  cycle programme .- as perhaps $12-$15 million per annum.

Such a figure would put the AAEC's. nuclear research expenditure  at roughly 55% of the Commonwealth's total energy research " performance,  and about 35% of the national total.

1 0 . These figures illustrate a quite inappropriate bias in Australia's  energy effort. By comparison,  work on coal, a larger and  more immediately useful resource,  was funded to the extent  of $8.25 million; petroleum research and development consumed  C only $2,052 million, although it is a vital economic resource;

and solar energy,  in which Australia might make substantial  innovations and discoveries, took only $3,082 million. .

1 1 . .  .

The general picture is not substantially improved following  the 1978-79 Budget.  In addition to other allocations, an extra  $5 million has been made available by the Government for energy  research spending during 1978-79. Part of this amount has  been allocated to nuclear-related work.

12. Â·

A sound distribution of Australia's financial and manpower  resources among the various energy research and development  fields should be determined by a clear national policy from  which priorities can be decided, and a subsequent competition

among areas of research based on these priorities.

Should Australia research fields with significant local  opportunities? (e.g. available national resources, or skills  and knowledge).  Ã¢ÂÂ

.  Should Australia concentrate on solving its own future  energy needs?

Should Australia concentrate on those fields in which it can  make a significant international contribution?

Should. Australia try to keep in touch with developments .   over the broadest possible range?

Currently, no such overall framework exists, and existing  energy research activities are not founded on a general 4 policy. The inappropriate high level of funding of nuclear  energy research.is perhaps the best evidence of that fact.

Criticisms of the AAEC

13. Conflict of Interest: The AAEC is responsible,  under the Atomic Energy Act, for  undertaking exploration for and processing of uranium, for  constructing and operating nuclear reactors, and for performÂ­

ing nuclear energy research and development. .  .

However, the Commission has also had a. wide variety of  monitoring and regulatory responsibilities associated with  nuclear activities. These have included both advisory and

executive responsibilities, and have covered environment  protection, health, safety, security and safeguards.

There are several consequences of the AAEC's dual responsibility  for nuclear regulation and performance.  The first is that,  especially in a period of Government financial cutbacks as  is presently the case,  competition among different parts of  the Commission's work has resulted in neglect of safety and  environment protection.

For example, according to the^Minister1s reply of 22 August  1978 to a Question bn Notice :  "the compilation (by the AAEC) of Environmental Survey Reports (for 1976 and 1977) from  records has been delayed due to staff shortages".

A similar problem was revealed in evidence ^ given by Dr. G.L.  Miles, Research Establishment Site Manager,  to the Senate  Estimates Committee:

"We have found from experience that the loss of professional  staff has been relatively small. The loss in terms of our.  trade, technical, clerical and typing staff has been fairly  substantial. The result is that we have reached the situation  where the day to day serving of our research establishment

has become extremely difficult ... for example, there is  a problem with the maintenance of fire extinguishers around  the site —  a routine kind of thing. This routine servicing

of safety suffers".

The New South Wales Branch of the Association of Architects,-  Engineers, Surveyors and Draughtsmen of Australia has expressed  its concern publicly and to the Minister that reduced staff  levels at the AAEC have resulted in problems in ensuring  adequate staffing in such areas as safety and effluent control,  and has indicated its concern that safety might be compromised  as a result of the staff ceilings imposed.

. . . /5

The Government's policy on public sector spending must be  held responsible for the immediate problem; but it should  be recognized that the implementation of. this policy leads  inevitably to cuts in safety etc. staffing without a

rational basis, when the AAEC is responsible for both nuclear  promotion and regulation.

A second illustration of Government and AAEC insensitivity in  nuclear monitoring was provided by the appointment of Mr.. R.M. Fry as Acting Head of the Office of the Supervising  Scientist. Mr. Fry was formerly Director of the AAEC's  Environment and Public Health Unit,  and was active on behalf  of the AAEC at the Ranger Inquiry hearings. Regardless of

Mr. Fry's personal and professional experience and integrity,  his appointment could not ensure maximum public acceptance of  the independence of the Government's monitoring agency from  its uranium development interests associated with the Ranger  project.

Thirdly, the operation and administration of the Government's  nuclear safeguards responsibilities express a further conflict  of interests for the AAEC. Until recently, the Australian _  Safeguards Office (ASO) operated "from within the Commission"  as part of the Regulatory and External Relations Branch .   Although the Office now claims to be "financially independent of  .  the AAEC" , it still reports through the Chairman of the

AAEC to the Minister, uses AAEC administrative^gupport and is  allocated a staff ceiling as part of the AAEC .

In fact, the staff of the ASO is basically former AAEC staff. And clearly the ASO,is in practice, dependent on the AAEC.

This model of operation —  in safeguards and security, as.,  in environment and health protection — -  raises the Â·

possibility of a real or apparent conflict of interest within  the Commission. In the case of the ASO, the problem is  exacerbated by the low level of staffing of the Office, in  comparison with its extensive responsibilities.

Following the expression of considerable public concern over  this conflict of interest within the United States AEC, this  body was divided in 1974. The regulation and safety aspects  of the use of nuclear energy were given to the Nuclear  Regulatory Commission, and nuclear research and development

became the responsibility of the Energy Research and  Development Administration. '

In Canada, the United Kingdom and West Germany,  too, these  functions are separate.

In view of the recent experience of the AAEC over staffing,  in view of the inappropriate relationship between the AAEC  and the ASO, and particularly in the context of substantial  Australian and international interest in ensuring the most

effective nuclear safety, safeguards and security systems  possible, the promotional and regulatory functions of the  AAEC should be clearly divided, on a statutory basis.

.  .  .  /6

14. .

Failures in Technological Innovation: The AAEC has been involved with two major failures in  attempts to develop or introduce nuclear technologies.

The first was its research into a beryllium oxide-moderated  high temperature gas-cooled nuclear reactor (HTGCR), which  continued well after similar work overseas had been abandoned,   and which ended in failure,  acknowledged in the Commission's  1965-66 Annual Report.

The second was the Commission's misguided championing of the  cause of a nuclear reactor at Jervis Bay. The entire episode  was surrounded by poor advice,  over the need for a reactor, .  '  the best kind of nuclear technology, and the economics of

the project. .

This record is a source of considerable disquiet in considering  f  the suitability of the AAEC as the sole agency responsible for  the development of uranium enrichment technologies, and for,  advising the Government on this project.

15. Quality, of Nuclear Research: It would be a generous statement .

to say that the work of the AAEC is of questionable quality.

For example,  its commitment to, and perseverance with, the  HTGCR was a major technical error.

,  Much Of the research work of the AAEC is published only in  internal documents, not subject to the normal processes of peer  review by the international scientific community.

According to its annual reports, the AAEC1s Power and Energy  Program includes studies of economic aspects of energy, and it  has been responsible for publishing "economic" judgements about  energy.  However,  none of its officers has-^ad any experience  ‘  or training in economics outside the AAEC .  Under these

'  circumstances,  it is not surprising that opinions expressed by  the AAEC or its officers in relation to the economics of  .  various energy alternatives, to the uranium market, or to the  value of uranium processing (including enrichment) are not

regarded as objective, or, indeed, of any value as policy advice

The AAEC's involvement in the failure to adequately protect and  restore the Rum Jungle environment at the end of the operation  of that uranium mining operation is further evidence of its  record of technical errors.

16. Excessive Secrecy. * There is a record of excessive, indeed obsessive,secrecy -  associated with the work of the., AAEC. This fact was referred

to in 1970 by Mr Jacobi, M.P.:

i

. . ./7

-  >

"This Government has never at any time furnished  the Parliament or the public with so-called  progress reports oh matters of substance. This Government  arbitrarily decided to construct the nuclear power plant; Ã¢ÂÂ .

it arbitrarily decided to build it at Jervis Bay; it will 4  arbitrarily inform the Parliament and the people after it  has arbitrarily selected the successful tenderer. Then _ * and only then will our people be informed of the crucial  matters relating to the degree of radiation emissions and their  possible effects on health and the environment and the dispersal  of radioactive wastes.  "

14

It was also referred to in 1971 by Mr L.R. Johnson M.P.  when he urged the need for some effective surveillance "if we  are to ensure that the squandering of taxpayers' money that .   had characterized the activities of the Commission in the .

past is to be minimized and reduced in the future."

15 This attitude persists until today. The Minister has refused  to indicate the extent of the AAEC's research on uranium  enrichment, including the number of staff involved, o n .the  grounds that "the identification of the number of people

engaged on particular aspects of ni^glear fuel cycle research  is of potential commercial value."

Given that secrecy in the past has been disastrous for Australia's  nuclear effort, there is no reason to be satisfied with the .   current attitude of the AAEC and the government. We can not

be certain that "secrecy" is not?again,  a veil to obscure  waste and incompetence.

The fact that this research was being carried out;and the  difficulty experienced in having the circumstances revealed, emphasiz  the failure of the AAEC to maintain its proper accountability to I. Ã¢ÂÂ   the parliament and to the public.  It can only reinforce a lack of

public confidence in the Commission.

17. .

Lack of Mission: The AAEC's self-selected and self-promoted mission to develop  the HTGCR and subsequently to force the government ot build  a nuclear power reactor were failures, and should not be

repeated. .

Under the Labor government the AAEC was given responsibility  for uranium exploration and development. The present government  has axed its exploration activities and retains only the pre-1976  involvement of the Commission in Mary Kathleen and the Ranger  project.

Over the past few years, the Commission has promoted itself ds a significant contributor to uranium enrichment research, .  arid ds a possible source of advice and technology as a  basis for an enrichment industry in Australia. Whether or not these Claims can be justified must be regarded as an open  question.

. .  .  /8

It is more likely that, as was the case with the Jervis Bay project,  the Commission is pushing its own barrow, and relying on secrecy,  the basic technical ignorance of. politicians, and the uncritical  pro-uranium mining attitude of the government to be successful.

Indeed, the present review is obviously directed towards providing  the AAEC with a mission, one which might attract public support.  However, the AAEC is fundamentally an unsound structure for suchf   a re-orientation, and its record is not one on which a sound,  broadly-based energy research programme could be founded.  -There is little evidence, for example, that the AAEC has  demonstrated competence in non-nuclear research. It can publish

little of the results of this work. There are certainly many  experienced, creative, broadly interested and high quality  scientists and engineers elsewhere in Australia who deserve

financial and institutional support. In many cases, these  researchers deserve support before AAEC researchers.

18. Proposals At present the AAEC undertakes a variety of functions, including:

(i) nuclear fuel cycle research and development; (ii) radio-isotope preparation and distribution; (iii) regulatory and safety aspects of nuclear operations;  (iv) participation in mineral development; (v) de facto source of nuclear energy policy advice; (vi) where necessary, nuclear weapons research and advice;

(vii) minor amount of non-nuclear energy research. .

19. There are clearly overlaps with, for example, the.Bureau  of Mineral Resources and the CSIRO in mineral exploration. There are also such activities as the production of radioisotopes

for medical and industrial purposes which make use of the Lucas  Heights nuclear reactor but are unrelated to energy research.

20 . .  .  .

The activities of the AAEC should be divided so that those  which are functionally unrelated or involve conflicts of  interest are separated.  .

21. The facilities at the Lucas Heights Research Establishment should  be regarded as a national scientific and technological resource,  available on a commercial basis for use in association with

commercial operations (e.g. radioisotope interests) and on  an appropriate basis for such other activities as energy  research.

2 2. ~

A separate statutory authority should be established to be  responsible for environmental protection,  health, safety,  security and safeguards aspects of nuclear activities. Such an authority would subsume the relevant activities of  both the AAEC and the ASO. .

<1

.  .  ./9

23.  Energy research and development activities presently  undertaken by the AAEC should become the responsiti-lity of a.  broadly-based and broadly-inherested National Fuel and Energy Commission. Specific research programmes would j

continue to be supported or  would be terminated after consideration of their relation to  Australia’s overall energy needs. These needs would be  based on a .comprehensive energy policy, and would take into

account the available national natural,  financial and  manpower resources.

Research priorities would be based, in addition, on Australia's  specific energy needs, and a consideration of those fields  in which Australia could make a singificant technical contribution

This would necessarily substantially reduce the emphasis . currently placed on nuclear research and would thereby remove  the current pro-nuclear bias in Australian energy research, and  free further resources for use in advancing the development

and use of non-nuclear energy sources.

REFERENCES

1. A.M. Moyal,  "The Australian Atomic Energy Commission: A Case Study in Aust.  Science and Govt.", Search ,Vol 6, No 9, pp 365  (Sept. ,  1975) .  Â·  Â·

2. Royal Commission on Aust.  Govt. Administration, Report, para.  10.2.34, p 318.

3. Energy Research and Development in Australia 1976-77: A National Survey (Dept. National Development, 1978) Â· '

4. Commonwealth Parliamentary Debates, House of Representatives,  Answer to Question on Notice No. 737, 13 September 1978.

5. Commonwealth Parliamentary Debates, House of Representatives,  Answer to Question on Notice No. 1221,. 22 August 1978.

6. Commonwealth Parliamentary Debates, Senate Estimates Committee B ,   23 October 1978, pp 952-3.

7. AAEC 24th Annual Report 1975-76, p 54.

8. AAEC 25th Annual Report 1976-77.

9 Australian Safeguards Office Annual Report 1977-78, p.5.

10. Senate Estimates Committee B, 23 October 1978 Department  of National Development,  Replies to Question on Notice,  pi.

11. A.M. Moyal, op., cit. .

12. Commonwealth Parliamentary Debates, House of Representatives, Answer to Question on Notice No. 737, 13. September 1978. .

13. Commonwealth Parliamentary Debates,  House of Representatives, 30 September 1970, pp 1949-52.

14. Commonwealth Parliamentary Debates, House of Representatives,  4 November 1971, pp 3081-82.

15. Refer to Commonwealth Parliamentary Debates, House of  Representatives, Answer to Questions on Notice Nos. 737  and 754, 13 September 1978.

16. Commonwealth Parliamentary Debates House of Representatives,  Answer to Question on Notice,No. 227 4 ,  24 November 1978.

17. Commonwealth Parliamentary Debates,  House of Representatives, Answer to Questions on Notice Nos.  1250, 27 September 1978 _ .and 2732, 24 November 1978.  I

18. Commonwealth Parliamentary Debates, House of Representatives, Â·   Answer to Question on Notice No. 2842, 27 February 1979.

\L9. Outlined in Commonwealth Parliamentary Debates, House of  Representatives,  Answer to Question on Notice, No.. 595, 25 May 1978.

