I won’t sugarcoat it: With a projected $2.5 million deficit in 2019, increased scrutiny from government and the public and conflicting priorities, PEO is facing troubled waters. But these challenges also present an opportunity to make some much-needed course corrections to put us back on track to focus on our core mandate of regulating the engineering profession.
THE CHALLENGES: FINANCES, PUBLIC SCRUTINY, GOVERNANCE
Let’s start with the bad news: PEO is facing a potential $2.5 million deficit for the 2019 budget (this figure is subject to revisions during Council’s November 16 meeting)—a financial position I’ve yet to see during my time with the association. But it’s easy to see how we got here. Our annual P.Eng. licence fee of $220 hasn’t increased in more than 10 years, meaning the fee hasn’t even kept pace with the inflation rate. At the same time, PEO Council continues to maintain and add new programs, which add costs to our budget. I’m an engineer, but I’m also a business person, and it’s very clear that you cannot continue charging the same amount for a service while costs increase. Something must give.
In my last two columns, I’ve discussed how professional regulators both in Canada and globally are coming under increased scrutiny by governments and the public. This was underscored recently at a Council on Licensure, Enforcement and Regulation (CLEAR) governance workshop I attended with President-elect Nancy Hill, P.Eng., LLB, FEC. The facilitators discussed the growing public skepticism of self-regulators’ ability (and willingness) to police their own and how governments in many jurisdictions are increasing oversight—and sometimes taking over regulation outright—of professional regulators. In the United Kingdom, all health regulators are annually audited by the Professional Standards Authority (more on them later); in Ireland, all health regulators must have a majority of public members on their boards; and in Australia, complaints and discipline processes are now independent of some regulators.
This creeping government oversight is also coming to Canada—and the engineering profession. This year, the British Columbia Ministry of Environment and Climate Change released a report recommending the government establish an independent Office of Professional Regulation and Oversight that would oversee professions involved in the province’s natural resource sector, including Engineers and Geoscientists BC (see Engineering Dimensions, September/October 2018). The body would develop and dictate governance best practices related to investigations and codes of conduct, incompetent practice and sanctions; and standardize governance elements including the authority to regulate firms, council authority to pass certain bylaws and continuing professional development. The legislation would also specify new rules for council and committee composition, with the oversight body vetting and appointing council and committee members, potentially eliminating council elections.
And PEO is not immune, as the Office of the Fairness Commissioner recently announced that it would soon be auditing Ontario regulators looking for potential barriers to entry into professions and issuing compliance orders to correct identified barriers.
Finally, PEO needs a culture shift between Council and staff. Essentially, there needs to be clear division between “church and state” and strong leadership on both sides to ensure Council is focused on the high-level policy work of governing the profession while providing clear direction to staff. Effective boards focus exclusively on strategy and policy, leaving operations to management and staff. PEO needs a strong registrar who can proactively protect and enhance the culture of the staff while bringing relevant, timely information to Council that allows us to focus on our board work and fiduciary responsibilities. To that end, our search for a permanent registrar is ongoing.
THE OPPORTUNITIES: REGULATORY REVIEW AND RENEWAL
Now the good news: In September, PEO Council passed a motion to commission a regulatory performance review by the aforementioned Professional Standards Authority. In my last column (“The value in regulatory performance reviews,” Engineering Dimensions, September/October 2018, I examined the results of a similar review undertaken by the BC engineering regulator and how the audit helped them to bridge regulatory gaps to make them more effective as a regulator.
Given our challenges, this is exactly what PEO needs—an unbiased evaluation of our performance. We need an honest appraisal of our effectiveness in carrying out our core regulatory activities and the costs required to ensure we perform them well. This may result in a serious review of our annual P.Eng. licence fees to determine if we can adequately support our operations at the current rate or if an increase is required. Such an evaluation will also help point out programs that don’t necessarily align with our core mandate and will help guide us through the tough job of trimming activities—and costs—to get us back to strong financial health.
Ultimately, an independent review will provide us with the foundation required to develop a rational approach and business plan to get our house in order. Only then can we devote ourselves solely to regulating and advancing the engineering profession to protect the public interest.