Regulatory operating model

Transcription

1 RAIL SAFETY Regulatory operating model

2 NZ Transport Agency Published March 2017 (16-316) ISBN (print) ISBN (online) Copyright: March 2017 NZ Transport Agency If you have further queries, call our contact centre on or write to us: NZ Transport Agency Private Bag 6995 Wellington This publication is also available on NZ Transport Agency s website at The Transport Agency is part of, and contributes to, the Safer Journeys programme. Safer Journeys is the government s strategy to guide improvements in road safety over the period The strategy s vision is a safe road system increasingly free of death and serious injury. It is a coordinated effort across partner agencies to improve each aspect of road safety better behaviours, a safer road environment, safer speeds and higher vehicle standards. For more information visit

3 Rail Safety Regulatory Operating Model NZ Transport Agency 1 CONTENTS PURPOSE OF THIS DOCUMENT 2 SCOPE 3 THE RAIL REGULATORY FRAMEWORK 4 REGULATORY STRUCTURE 4 LEGISLATIVE APPROACH 5 REGULATORY ROLE AND FUNCTIONS OF THE TRANSPORT AGENCY 5 OBLIGATIONS OF RAIL LICENCE HOLDERS 6 OUR APPROACH 7 RAIL SAFETY OUTCOMES 7 RESPONSIVE RISK-BASED RAIL SAFETY REGULATOR 8 SAFE AND COMPLIANT REGULATED COMMUNITY 8 REGULATORY PRINCIPLES 9 OUR ACTIVITIES 10 DIRECTING OUR OPERATIONS RISK MONITORING AND INTELLIGENCE 11 NATIONAL PRIORITIES PROGRAMME 11 INCENTIVISING AND ASSISTING COMPLIANCE EDUCATION AND PERSUASION 11 FIELD INSPECTIONS 12 INTERVENTIONS LICENSING 12 SAFETY CASES 12 SAFETY ASSESSMENTS 12 INVESTIGATIONS 13 OUR TOOLS 15 EDUCATION AND ADVICE 15 SAFETY ASSESSMENT 15 REMEDIAL ACTIONS 16 SAFETY IMPROVEMENT PLAN 16 FORMAL WARNING LETTER 16 REPLACE OR VARY SAFETY CASE 16 PROHIBIT OR IMMOBILISE RAIL VEHICLES/INFRASTRUCTURE 16 SUSPEND LICENCE OR IMPOSE TEMPORARY LICENCE CONDITIONS 16 PROSECUTION 17 IMPOSE PERMANENT LICENCE CONDITIONS 17 REVOKE LICENCE 17 SUMMARY 18

4 2 NZ Transport Agency Rail Safety Regulatory Operating Model PURPOSE OF THIS DOCUMENT The NZ Transport Agency has primary regulatory responsibility for rail safety in New Zealand. The Rail Safety team has a critical regulatory role in providing independent assurance to stakeholders and the public, of the effective management of rail safety risks by rail participants. The safe operation of rail transport services across New Zealand is achieved through regulation of the rail industry in accordance with the Railways Act 2005 (the act). Basic regulatory functions primarily relate to issuing licences and undertaking a range of compliance functions to assess the safety approach and performance of rail licence holders. The purpose of the Rail Safety Regulatory Operating Model is to: identify the regulatory principles and approach the Transport Agency has adopted to regulate safety in the rail transport industry show how the compliance and enforcement measures set out in this model will be applied to rail participants ensure a consistent approach to compliance and enforcement measures nationally provide an appropriate level of transparency to regulated parties (primarily licence holders) around the application of compliance and enforcement measures.

5 Rail Safety Regulatory Operating Model NZ Transport Agency 3 SCOPE The Rail Safety Regulatory Operating Model describes the principles and approach underpinning our regulatory activities, and describes how we will work with the rail transport industry to sustain and improve safety performance. This document is intended to be read in conjunction with other key Rail Safety team documents making up the Rail Safety team s regulatory framework. The following diagram illustrates, at a high level, the relationship and hierarchy between the regulatory operating model and other Rail Safety team and Transport Agency documents. Rail Safety Compliance Strategy Rail Safety Regulatory Operating Model Rail Safety Annual Business Plan Business plan compliance activities Rail Safety Intervention Guidelines Rail Safety Licensing Evaluation Guidelines Rail Safety Assessment Programme Rail Safety National Priority Programme Rail Safety Stakeholder Management Plan Rail Safety Risk Profile Register NZ Transport Agency Prosecution Policy Assessment SOP Rail Safety Risk Profile Operating Procedure NZ Transport Agency Compliance Intervention Panel ToR Field Visit SOP

6 4 NZ Transport Agency Rail Safety Regulatory Operating Model THE RAIL REGULATORY FRAMEWORK The act provides the basis of the rail regulatory framework, and its core purpose is to promote the safety of rail operations. The approach of the act is that the industry develops, implements, administers and continuously improves its own codes of practice and standards, and safety risk management policies and procedures. The Transport Agency has powers under the act to ensure the industry maintains compliance with these or to intervene where it believes a specific risk is not being addressed acceptably. In order to promote rail safety, a clear chain of safety accountability was established in the act. The act maintains this by: setting out the obligations of rail participants to ensure safety authorising the making of rules clarifying the nature of approved safety systems established by rail licence holders. The act also encourages a proactive approach to identifying and managing critical safety issues. It does this by ensuring that: key rail participants are licensed by the Transport Agency key safety data is collected rail licence holders demonstrate they are managing safety risks, via their specific safety cases and recognised industry-developed standards the Transport Agency has powers to assess, inspect and sanction rail participants. REGULATORY STRUCTURE MoT create legislation NZ Transport Agency the primary rail safety regulator WorkSafe NZ Worker health and safety TAIC Investigates safety incidents and accidents Adopted standards agreed standards between rail regulators and rail participants National rail system standards rail committee that develops and manages the safety standards that apply to operators on the national rail system Rail access providers manage rail networks Rail operators operate rail services Non-licensed rail participants Subject to some interventions

7 Rail Safety Regulatory Operating Model NZ Transport Agency 5 LEGISLATIVE APPROACH The act supports a principles based approach to regulatory oversight. This means the act allows the Transport Agency to provide oversight at a results level (ie are rail participants maintaining safe operations?) rather than being required to specify prescriptive rules on what they must do and how they must do it. In this manner, the act firmly places responsibly for safe operations in the hands of the industry, recognising that is where there is the greatest technical knowledge as to the nature of the operations and the appropriateness of safety protections. The tools provided in the act to support this approach are described later in this document, but primarily are: licensing the Transport Agency decides who can and cannot operate rail vehicles or manage rail networks safety cases a licence holder must have an approved safety case, describing their safety approach assessments the Transport Agency can observe and seek evidence on how a participant is managing their safety obligations. In particular, the safety case is the overarching tool to achieve this and therefore a foundation of the rail regulatory framework. The act also provides a framework of more prescriptive interventions the Transport Agency can undertake. The Transport Agency may need to robustly address significant risks that present an unacceptable immediate risk, or set common approaches for managing common risks. Some of the interventions available include setting conditions on individual licence holders or prescribing rules across the industry. The act provides a legislative framework to support access providers in ensuring a safe network. Access providers have statutory powers to allow them to protect the rail corridor and take urgent action where necessary to address safety risks. REGULATORY ROLE AND FUNCTIONS OF THE TRANSPORT AGENCY The Transport Agency, as the appointed regulator, is responsible for overseeing regulatory compliance in the rail transport system. This independent statutory function is also conferred on the Transport Agency in the Land Transport Management Act 2008 (LTMA) under the LTMA, the Transport Agency s objectives are to undertake functions in a way that contributes to an effective, efficient and safe land transport system in the public interest. The key powers conferred on the Transport Agency under the Railways Act are as follows: Grant a licence. Approve, replace or vary a safety case. Add conditions to licences. Suspend, revoke or impose temporary or permanent conditions. Require a rail participant to undergo an ordinary or special safety assessment.

8 Rail Safety Regulatory Operating Model NZ Transport Agency 6 OBLIGATIONS OF RAIL LICENCE HOLDERS The primary duties of rail participants are covered by sections 7 and 11 of the act and they include the following: a) ensure, so far as is reasonably practicable, that none of the rail activities it is responsible for causes or is likely to cause death or serious injury to others (section 7) b) comply with licence conditions, safety cases and safety systems (section 11) and recognised industry developed standards. The following table illustrates the different roles of various rail participants. Rail participant (refer to definition in section 4 of act) Rail participant A Not required to have a licence (but can be subject to some interventions) Activities: Infrastructure owner Rail vehicle owner Railway premise owner Network controller Maintenance provider Railway premises manager Duty of care requirements under act Monitored by safety assessment tool Rail participant B Required to have a licence and is therefore a primary focus of the act and regulator 1: Access provider The person who controls the use of that railway line by rail licence holders Duty of care requirements Monitored by safety assessment tool Safety case required 2: Rail licence holder A person who provides or operates a rail vehicle Duty of care requirements Monitored by safety assessment tool Safety case required This table is a simplification for illustrative purposes. Whether or not a participant is required to have a licence is also informed by the precise nature of the activities and the participant s influence on safety decisions.

9 Rail Safety Regulatory Operating Model NZ Transport Agency 7 OUR APPROACH Compliance means meeting or exceeding the requirements of the regulatory framework that is designed to ensure high levels of safety on the rail transport system. The Transport Agency carries out its regulatory activities in a manner which is responsive, transparent, accountable, proportionate and consistent. RAIL SAFETY OUTCOMES How our compliance and enforcement activities contribute to rail safety outcomes is explained in our intervention logic model. OUTCOMES Strong public confidence in rail network safety Safe transport of people and freight on the rail network Safe rail workers and public operating near the rail corridor IMPACTS Unsafe situations are identified and addressed (and are seen to be addressed) quickly and effectively, proportionate to the level of risk they present Problems are avoided operators embed and maintain safe systems, practices and culture Credible deterrents and strong incentives to do what s required Regulated parties have the knowledge, systems, tools and capability to operate safely in and around the rail corridor Regulated parties understand: their obligations the required standards consequences of non-compliance the regulator s role and approach industry safety performance The public know how to behave safely in and around the rail corridor Operators have a positive attitude towards safe practice ACTIVITIES Audit, enforcement, and responses Risk-based, targeted audit/ inspections and investigations Targeted, proportionate enforcement Timely, effective responses to safety issues Design of regulation Effective regulatory design and incentive setting policy, rules and standards Licensing Entry and exit control for operators into the closed system; registration Information, education and engagement Proactive and effective information, engagement and education to the public and licence holders directly and through partners Data, intelligence and analysis

10 8 NZ Transport Agency Rail Safety Regulatory Operating Model RESPONSIVE RISK-BASED RAIL SAFETY REGULATOR Our operating model embodies a risk-based and responsive approach to carrying out our regulatory role, which enables the Transport Agency to target its activities efficiently and effectively. An effective and efficient safety regulator has the following features: Sound strategies, plans, policies and processes We have a clear vision, operational plan, and operational policies that are linked to the Transport Agency strategy. A well-designed system We have deployed a compliance strategy and framework that demonstrates a comprehensive understanding of the regulatory approach being taken and utilises the full range of regulatory tools available. An intelligence-led risk-based approach Risk analysis and intelligence informs our programme, responses and deployment of resources. Planned operational activities Our work programme caters to the risk monitoring outputs, and delivers on strategic goals and objectives. Effective operational interventions We understand our role, we are skilful and deliberate in the deployment of our regulatory tools and are clear about the contribution our activities make to rail and transport safety. Robust regulatory capability and positive culture We work as an equal alongside our regulatory and partner agencies to achieve safety outcomes. Engaged stakeholders and effective relationships We understand and influence our stakeholders and partners, communicate well and are proactive in maintaining and continuously improving those relationships. SAFE AND COMPLIANT REGULATED COMMUNITY The Transport Agency expects that rail participants will operate in a safe and compliant manner and accept the obligations embodied in the act and associated requirements (such as a safety case and safety systems). Full and timely compliance can be difficult to achieve when any of the following general conditions is not met: 1. The rail participant must be aware of their regulatory responsibilities. 2. The rail participant must to be willing to comply. 3. The rail participant must be able to comply. Key influences on compliance behaviour include the following: Incentives: The rail participant understands that while there will sometimes be a cost for individual safety improvements, overall there are profitability and productivity opportunities for a compliant and safe operation. These can include a more efficient, productive operation and workforce, an enhanced reputation for a positive and safe customer experience and recognition from peers for best practice. Fairness and trust: Regulated parties will be more likely to comply if they perceive that the compliance agency and the regulatory regime it administers are fair and that the Transport Agency, and other members of the regulated sector, are trustworthy. Opportunity: This includes both the opportunity to be compliant (enhanced by, for example, low compliance costs and simple rules) and the opportunity to be non-compliant (for example, opportunities for evasion). Economic factors: Safety investment decisions by rail participants may be influenced by economic factors not only general economic conditions but also factors specific to the rail industry or specific participant. Deterrence: This is the perceived risk of non-compliance being detected (through assessments, for example) and of subsequently being subjected to sanctions. This is most effective if the implications of being found non-compliant are high and there is a reasonable likelihood of detection.

11 Rail Safety Regulatory Operating Model NZ Transport Agency 9 REGULATORY PRINCIPLES Our operational decision-making and compliance activities are guided by core regulatory principles. These principles are not in any order of priority. How the Transport Agency undertakes compliance and enforcement is guided by the following: PRINCIPLE COMMENTARY We target our approach Risk-based Intelligence-led We target our efforts to the areas of greatest risk, considering both the extent of potential harm and likelihood of the risk eventuating. We recognise that risk cannot be entirely removed - we aim to achieve a level of risk that can be tolerated and aligned with industry best practice. We use the best available information to support good judgements, the targeting of our efforts, and increased understanding about the nature of risk or harm. We implement smart responses Systemic focus Proportionate and tailored responses We actively develop our understanding of the underlying attitudes, behaviours, incentives, values, business systems or processes that create systemic safety risk within or across duty-holders. We work with rail participants, partners and other stakeholders to address drivers of systemic risk. Our regulatory interventions are proportionate to the presenting risk, harm and attitude to compliance. We recognise that different strategies are required for different risks and compliance attitudes. We consider the motivations, incentives, priorities and capabilities of rail participants in each situation to ensure we select the right tool to achieve the rail safety outcomes. We make principled decisions Transparent, fair and consistent Independent and impartial Rail participants know what to expect from us in the way we interact and in the way we make decisions. We are open about what we do and how we do it. Our approach is fair and consistent. Our decisions are defensible. We communicate our decisions clearly and provide clear, timely feedback. We provide independent assurance to the public and wider stakeholders of the effective management of rail safety risks. We act in a fair, objective and transparent manner, in the best interest of rail safety. We are guided by legislation, public good, and our understanding of risk, harm and benefits from actions. We are connected & accessible User-centric approach Active engagement We incentivise and make smart choices easy for rail participants to increase their awareness and understanding of regulatory requirements. We provide access to appropriate information and support to enable them to comply. We minimise administrative burden from our regulatory requirements. We are responsive, courteous and fair in our interactions with all parties. We engage actively with rail participants, partners and other stakeholders to understand issues and facilitate effective solutions.

12 10 NZ Transport Agency Rail Safety Regulatory Operating Model OUR ACTIVITIES Rail safety regulatory activities will be undertaken for the purpose of: protecting public safety the Transport Agency, as the independent regulator, acts in the public interest by holding rail licence holders to account for their safety performance Information ensuring rail licence holders are responsible for a high level of safety management influencing the attitudes and behaviours of rail licence holders, and other persons carrying out rail activities, is key to effective safety performance promoting continuous improvement and proactive safety risk management practices in rail transport organisations that only comply with minimum standards are not well situated to deal with emerging safety risks ensuring compliance with relevant legislation, rules, regulations and standards through effective and appropriate education and compliance activities. Our activities are particularly focused on licence holders, who operate within a closed regulatory system that we control entry and exit to, as below. However, many of our compliance activities can be directed at both licensed and unlicensed rail participants. Education Entry control REGULATE ENTRY Licensing Safety case assessment and licensing (apply standards) Rules and standards Ensuring safety risks in the rail industry are well-managed and controlled Approving and monitoring the safety systems used by operators Minimising risk as far as practicable, up to a tolerance threshold beyond which risk is unacceptable Data and intelligence Regulatory principles Risk analysis MONITOR PERFORMANCE MONITORING Analysis Field inspections Assessments Support Exit control ENSURE COMPLIANCE COMPLIANCE Investigation Safety Improvement Plan Safety case variation Operating conditions Suspend/revoke Prosecution Engagement

13 Rail Safety Regulatory Operating Model NZ Transport Agency 11 DIRECTING OUR OPERATIONS RISK MONITORING AND INTELLIGENCE Understanding risk across the sector is fundamental to operating as a professional and risk-based regulator. A comprehensive risk and intelligence-led approach ensures integration of the other functions it allows information gained from all our activities to be properly utilised to direct our interventions as part of the licensing and the national priorities programme functions. It can also provide some evidence of the effect our regulatory work is having on the safety of the rail sector. NATIONAL PRIORITIES PROGRAMME A function of the rail safety regulator is to ensure risks to the safety of rail operations are addressed to avoid preventable accidents. It is ultimately the responsibility of rail participants to identify and manage their own risks. However, a key strength of our role is that we have a visibility over the entire industry and connections with those regulating safety in related industries. Without this context, individual participants may not be in a position to fully appreciate risks they face in their operations. The national priorities programme utilises the unique perspective and authority of the rail safety regulator to identify and target the priority safety issues faced across the sector, rather than for a particular rail participant. This programme is determined on an annual basis as risks and compliance monitoring activities are identified and prioritised, as part of the annual rail safety business planning process. Through the programme approach, the collective capability of the industry and other agencies 1 is used to drive step-changes in the effectiveness of risk mitigations. This allows risks to be subsequently managed as business-as-usual by rail participants on an individual basis (and overseen by the rail safety regulator in its regulatory function). To address a national priority, we consider our full range of compliance activities with selecting the optimal intervention approach, and we most usually would apply a mix of activities to maximise effectiveness and effect rapid change. INCENTIVISING AND ASSISTING COMPLIANCE EDUCATION AND PERSUASION A responsive, risk-based compliance strategy recognises that most regulated parties are willing to voluntarily comply with regulatory obligations, or can be influenced to do so. A focus on providing information, education, encouragement and assistance will provide: clarity and certainty for the rail transport sector about their obligations and the outcomes the Transport Agency is seeking convenience and lower compliance costs for the regulated sector in meeting their obligations a more open and responsive relationship between the Transport Agency and the rail transport sector, with members of the sector being more likely to communicate with the Transport Agency about compliance issues to the benefit of both parties increased public confidence in the Transport Agency, and greater appreciation of its objectives and public responsibilities. The Rail Safety team will, where appropriate, work with rail participants and stakeholders by providing education and advice as a key method of assisting the industry to improve the safety of railway operations. The provision of advice may be appropriate in circumstances where there is a lack of awareness about or misinterpretation of the requirements of the act, rules and regulations, or the circumstances of noncompliance are minor in nature and there is a willingness to make improvements to ensure compliance. The Rail Safety team will identify, recognise and promote best practice safety initiatives and performance, to influence the broader rail sector. 1 In particular, other regulators such as WorkSafe New Zealand and other transport safety regulators.

14 12 NZ Transport Agency Rail Safety Regulatory Operating Model FIELD INSPECTIONS Field inspections are a key education and persuasion activity carried out by the Rail Safety team (refer to the Field inspections standard operating procedure). The purposes of field inspections can include: ensuring ongoing compliance with the act encouraging open communication between the Transport Agency and rail participants engaging constructively with the aim of promoting continuous improvement in rail safety educating/updating on key activities assisting in resolving issues that have been raised from safety assessments or other means (such as internal rail participants audits). INTERVENTIONS LICENSING To ensure safety, rail participants must be licensed before they can carry out rail activities 2. As the rail regulator, the Transport Agency manages the entry and exit of rail licence holders via a licensing system. The licensing function is supported by an assessment of participants safety cases, which is described below. Licence holder performance is monitored via engagement, ordinary and/or special safety assessments and self-reporting by licence holders. To address unacceptable safety risks to individuals (such as death or serious injury), the Transport Agency can use interventions such as suspending, revoking or imposing temporary or permanent conditions on licences 3. SAFETY CASES All rail participants seeking to obtain a licence must submit a safety case proposal to the Transport Agency for approval and adhere to it when carrying out their rail activities. The act establishes the safety case as the overarching risk management documentation. The contents of a safety case are specified in section 30 of the act. Each licence holder must have a safety case that explains the system it will use to: ensure it properly identifies, assesses and controls the safety risks of its operations consult and/or communicate safety risks as appropriate with its rail personnel, representatives of rail personnel and any rail participants it may interact with continuously review and improve how it manages risk provide assurance to the Transport Agency that it is compliant with its safety case. Changes in a licence holder s safety case must be approved by the Transport Agency. SAFETY ASSESSMENTS The rail participant can at any time be required by the Transport Agency to undergo a formal review of all or part of their safety and risk management systems (such as a safety case). This includes supporting systems, programmes and workplace practices (refer to the Rail Safety Unit s Standard operating procedures for ordinary and special safety assessments). The process for carrying out such reviews is by way of either ordinary or special safety assessments 4. These assessments are carried out by an appointed safety assessor who has defined powers and responsibilities under the act 5. An ordinary safety assessment may be conducted as a scheduled activity (as part of the Rail Safety team s assessment programme) to provide assurance that the rail participant is complying with: the requirements of the act, rules and regulations licence conditions, safety cases and safety systems where applicable. 2 Section 15 of the act. 3 Sections 23 and 24 of the act. 4 Section 37 of the act. 5 Section 46 of the act Functions and duties of safety assessors.

15 Rail Safety Regulatory Operating Model NZ Transport Agency 13 A special safety assessment is initiated where the Transport Agency has, on reasonable grounds, determined that the participant s rail activities could cause the death of, or serious injury to, individuals or significant damage to property. It may be: as a result of information received about safety concerns regarding a rail participant the targeting of specific areas of risk identified through incidents or trends in response to a notifiable occurrence (accident or incident) concerning a rail participant 6. INVESTIGATIONS A function of the rail safety regulator is to identify and resolve the safety issues that have caused a specific incident or series of incidents to occur. Statutory investigations require in-depth, independent examination of a series of events to identify failures that must be addressed to prevent reoccurrences. It is important to have both a robust investigatory capability and a strong compliance capability in order to allow an authoritative enquiry. This ensures safety failings are resolved in an appropriate and timely manner, similar risks for other licence participants are identified, and prosecutions (if necessary) can be successful, to ensure accountability and deter future negligence. An investigation may be initiated through a range of circumstances, including the following: Arising from an adverse finding from either an ordinary or special safety assessment. A notifiable occurrence (accident or incident) concerning a rail participant. The targeting of specific areas of risk identified through incidents or trends. Arising from intelligence (intel) data. INVESTIGATION PROCESS Investigations are undertaken in order to determine: compliance with the act or safety case whether action has been taken or needs to be taken to address the non-compliance/harm the appropriate level of intervention for the non-compliance whether there are any lessons to be learnt for future guidance and advice. In selecting what safety incidents, complaints or information to investigate the Rail Safety team will take account of the following factors: The seriousness of any actual or potential breach of the act or safety case. The severity and scale of any actual or potential harm. The past compliance history of the rail participant. Whether the actual or potential harm relates to a priority on the national priorities programme. The wider relevance of the event, including whether the matter is in the interest of public good. Investigations may be performed in parallel or in cooperation with other agencies, depending on the nature of the incident. In particular, TAIC, Police and/or WorkSafe may be investigating the same incident as us. Where possible we will seek to coordinate investigations to minimise the impact and uncertainty on affected parties and ensure optimal usage of our resources. 6 A special safety assessment would be conducted if on reasonable grounds the Transport Agency determined the rail participant s activities could cause death, serious injury or significant damage to property - section 37(2) of the Railway Act.

16 14 NZ Transport Agency Rail Safety Regulatory Operating Model The Rail Safety team s investigation process can be summarised by the following diagram which covers the key stages. INVESTIGATION PROCESS SCREENING AND PRIORITISATION INVESTIGATION COLLECT INFORMATION DECISION- MAKING OUTCOME Investigation initiated by complaint, issue that has come to our attention or a proactive initiative Prioritisation What action to take? Determine scope of investigation Gather information and collate evidence Analysis of the facts Draw conclusions All or any of the following: Communicate decision to complainant, affected parties, investigated party and public (as appropriate) Educate investigated party and/or wider sector No further action Investigation started Seek expert opinion and assistance Decide on an outcome for the investigation Implement corrective actions Apply sanctions Complainant/rail participant advised where relevant Involve CIP where appropriate Adjust rail safety compliance approach

17 Rail Safety Regulatory Operating Model NZ Transport Agency 15 OUR TOOLS The Rail Safety team has a range of tools and functions available when it carries out safety interventions. These can be represented by a pyramid of options with the most rarely used, directive tools at the top. The pyramid reflects the use of education and persuasion as a primary activity to ensure compliance. However, the pyramid options are not intended to imply a sequential response to non-compliance. Revocation Permanent conditions Prosecute Suspend licence Prohibit or immobilise rail vehicle/infrastructure; vary licence conditions and safety case; special assessments Ordinary safety assessments and formal warning letter Findings of non-compliance; safety improvement plan; remedial actions Education, sector advice, field visits; stakeholder forums Identification and promotion of best practice safety initiatives and performance The way we apply our compliance activities is designed to create downward pressure in order to move non-compliant rail participants to become compliant, where low-level and less costly interventions will be appropriate. The Rail safety intervention guidelines describes how we will determine the appropriate compliance tool to use. However, in general terms the primary considerations are: the impact and associated consequences of the immediate risk the likely effectiveness of each tool the timeliness of and quality of resolution the rail participant s history of compliance and incidents. In response to any non-compliance matters, the following options are available to the Rail Safety team. EDUCATION AND ADVICE Providing advice and building sector capability may be appropriate in circumstances where there is a lack of awareness, knowledge or misinterpretation of compliance requirements, the non-compliance is of a minor nature and the rail participant demonstrates a willingness to comply. Engagement may occur through a variety of methods, including informal conversations, field visits, stakeholder forums and/or a compliance advice letter. SAFETY ASSESSMENT The Transport Agency may at any time require a rail participant or any of that participant s rail personnel to undergo either: an ordinary safety assessment at a time determined in accordance with section 30(1)(i) of the act and specified in the notice, or a special safety assessment at a time specified in the notice.

18 16 NZ Transport Agency Rail Safety Regulatory Operating Model REMEDIAL ACTIONS Remedial actions may be issued following a safety assessment where it is believed that the participant is carrying out rail activities in a manner that presents a significant risk to safety. A remedial action may also be issued to address a common theme across a number of (lower significance) non-compliances or safety improvement recommendations. SAFETY IMPROVEMENT PLAN If the Transport Agency is of the view that the rail participant has failed to address identified remedial actions, it may require a rail participant to prepare a safety improvement plan in respect of the rail activities specified in the notice. 7 FORMAL WARNING LETTER Following an assessment, investigation or field visit, we may issue a warning letter as an alternative to a higher-level enforcement response, where we consider that: the evidence gathered is sufficiently strong to establish a prima facie case, and there has been a breach or likely breach of the law, but that the matter can be satisfactorily resolved without a higher-level enforcement response. REPLACE OR VARY SAFETY CASE The Transport Agency may, at any time, require the replacement or variation of an approved safety case if it considers this necessary in the interests of safety and required to ensure necessary compliance with the Act and/or any other associated compliance requirements 8. PROHIBIT OR IMMOBILISE RAIL VEHICLES/INFRASTRUCTURE If the Transport Agency believes, on reasonable grounds, that the operation or use of a rail vehicle, class of rail vehicle or any railway infrastructure may endanger persons or property, and that prompt action is necessary to prevent the risk, it may do either of the following: Prohibit, or impose conditions on, the operation or use of the rail vehicle or rail vehicles of that class or railway infrastructure, or Detain or immobilise the rail vehicle or any rail vehicle of that class or railway infrastructure, if the Transport Agency considers this necessary to prevent its operation or use 9. SUSPEND LICENCE OR IMPOSE TEMPORARY LICENCE CONDITIONS The Transport Agency may suspend a licence issued under the act or impose temporary conditions in respect of that licence if it considers this necessary to avoid a risk of: the death of, or serious injury to, individuals, or significant damage to property being required to ensure necessary compliance with the act and/or any other associated compliance requirements Section 36 of the act. 8 Section 34 of the act. 9 Section 28 of the act. 10 Section 23 of the act.

19 Rail Safety Regulatory Operating Model NZ Transport Agency 17 PROSECUTION The act allows the Transport Agency to prosecute rail participants and personnel for breaches set out in the act. The key offences in the act are as follows: RAIL PARTICIPANT RAIL PERSONNEL RAIL LICENCE HOLDER OTHERS Section 7 Fails to, so far as is reasonably practicable, ensure its rail activities do not cause death, serious injury or significant property damage X X X Section 9(1) Fails to, so far as is reasonably practicable, ensure its activities near rail activities do not cause death, serious injury or significant property damage Section 9(2) Interferes with railway equipment X X Section 10 and 11 Fails to comply with licence conditions and safety case X Section 13 Fails to report incident/accident X X The Transport Agency can also apply to the court for an order prohibiting a person from acting as a rail licence holder, director of a rail licence holder or rail personnel. IMPOSE PERMANENT LICENCE CONDITIONS To provide assurance in regards to a specific and enduring area of risk, the Transport Agency may impose permanent conditions on the licence holder if it considers this necessary to avoid a risk of: the death of, or serious injury to, individuals, or significant damage to property. This action can only be taken when the Transport Agency has no other options to address the risk. REVOKE LICENCE The Transport Agency may revoke a licence issued under the act or if it considers this necessary to avoid a risk of: the death of, or serious injury to, individuals, or significant damage to property. This action can only be taken when the Transport Agency has no other options to address the risk, and so is particularly relevant in situations where we have determined that the rail participant is not able to meet its core safety duties.

20 18 NZ Transport Agency Rail Safety Regulatory Operating Model SUMMARY The below model is useful to summarise our operating model based on a responsive, risk-based approach to regulation. It is referred to as the VADE (voluntary, assisted, directed, enforced) model, and it was developed by the Ministry for Primary Industries. It is used by several New Zealand regulatory organisations. The VADE model illustrates how our application of compliance activities and regulatory tools is responsive to the context of the situation. Although risk and harm are not explicitly captured within the model, they are implicit in that we expect a rail participant to prioritise their compliance effort commensurate with the safety risk. Note that larger rail participants may have activities that fall across different behavioural categories and we will adjust our approach to different issues as appropriate, rather than apply a rigid approach across the entire operation. BEHAVIOUR ATTITUDE TO COMPLIANCE INTERVENTIONS REGULATORY TOOLS Negligent or reckless Recidivist or serious non-compliance Behaviour is ENFORCED Use full force of the law Prosecution; licence revocation and suspension Compliance is secondary Propensity for non-compliance; eg due to competing operational priorities; poor safety culture Behaviour is DIRECTED Deter by detection then directive action Improvement notices and plans; vary licence conditions Lacking capability/awareness Unintentional non-compliance; are not aware what is expected; do not have the capability to comply or lack of knowledge/experience Behaviour is ASSISTED Assist to comply Use risk-based monitoring; assessments and corrective actions; guidance and education Willing to do the right thing Incentivised to comply and know what is expected of them Behaviour is VOLUNTARY Make it easy Inform; provide education, advice and guidance and recognise and promote best practice initiatives and performance

21 If you have further queries, call our contact centre on or write to us: NZ Transport Agency Private Bag 6995 Wellington 6141 This publication is also available on NZ Transport Agency s website at OUR CONTACT DETAILS Debbie Despard National Manager, Rail Safety 50 Victoria Street Wellington Telephone: Debbie.Despard@nzta.govt.nz Dave Robson Manager, Rail Safety Compliance and Interventions 50 Victoria Street Wellington Telephone: Dave.Robson@nzta.govt.nz