Engineering Registration A driver of productivity and prosperity
We need to act now Australia’s economy is outperforming the world and we are experiencing an unprecedented demand for professional engineers - a demand that we cannot satisfy from domestic sources alone. Our reliance on overseas labour and a mobile domestic workforce to meet the challenges of economic growth is greater than ever, especially in the resources sector. Acute skills shortages remain in many areas of engineering practice.
a number of different Acts, regulations, by-laws and orders-incouncil. Many of these relate to the building and construction industry.
While many jurisdictions around Australia find their economy growing slowly – or in recession – others are booming. This means the domestic and international engineering workforce must be able to flow freely between States and Territories to continue to meet the demands of a patchwork economy.
A number of other States have de facto registration systems, where engineers performing particular work must be registered on a national engineering register.
Equally, we cannot rely on the Australian economy to always be this robust. Mobility of skilled engineering professionals must remain a priority area of reform. A morass of regulatory regimes in Australia is stymieing mobility for one our key enablers of growth, engineers. The peak bodies representing Australian professional engineers – Engineers Australia, Consult Australia, the Association of Professional Engineers, Scientists and Managers, Australia (APESMA) and the Institute of Public Works Engineering Australia (IPWEA), have come together with the common goal of seeing the establishment of a national, statutory, mandatory registration scheme for engineers. Currently there is no uniform regulatory regime covering engineers in Australia. Engineering services are regulated by
Queensland is the only State where engineers must be registered to provide professional engineering services, unsupervised.
The application of standards and rules to engineering practice in sectors differently across jurisdictions makes this even more complex. Other jurisdictions are already moving towards establishing a registration scheme for engineers. A national registration scheme for engineers has the support of the profession, the labour movement, employer representatives and the majority of jurisdictions around Australia. The maze of regulation will get more complex and add to compliance costs for engineers and firms if we do not act, as further States and Territories move towards establishing their own schemes. A national approach must be taken now, to develop a nationally-consistent, broadly-based, co-regulatory registration scheme for engineers.
Key benefits A national registration scheme for engineers would: Provide for the unimpeded movement of the engineering workforce across international and domestic boundaries by unpicking the maze for regulation which exists in Australia currently;
More effectively addressing skills shortages;
Thereby driving growth in the construction sector.
Provide real economic benefit. The substantial economic benefits of a national registration scheme for engineers have been borne out by detailed work undertaken by one of Australia’s premiere economic modellers, ACIL Tasman
– the only and therefore best source of information on the economic benefits of national registration; Protect the community and enhance safeguards. It would allow the profession to protect the community from underqualified engineers carrying out work and provide legal recourse against those who deliver sub-standard works;
Such as is the case in the State with the only existing comprehensive scheme, Queensland.
A model for a scheme to be adopted already exists and has been successfully in operation for many years in Queensland. We see that scheme as the foundation for adoption throughout the Commonwealth.
Addressing skills shortages to drive economic growth The chronic and ongoing shortage of engineers is well documented and understood and widely reported elsewhere. A strategic response to this shortage has been increasing reliance on skilled migration, with Australia producing only half of our engineering needs domestically1. The total immigration of engineers for (2009-10 is) 9,000, more or less static when compared to the year before, but a more than seven-fold increase from 2000-012. We must make best use of both our domestic and international engineering workforce to meet demand.
ACIL Tasman has found that a “national statutory registration process would also assist engineers to have international mobility and could help to integrate engineers from overseas”3, and that “this small reduction in skills shortage is estimated to generate an additional $185.58 million per annum in engineering construction activity alone in Australia”4. A registration scheme “would also ensure existing Australian engineers have mobility of trade”5 and “such benefits would amount to $207.60 million per annum”6.
The economic benefit “Combining the present value of total costs and total benefits associated with the proposed national registration scheme, the net present value of the scheme is estimated to be $7.4 billion under a seven per cent real discount rate while its benefit-cost ratio is calculated to be 3.14.”7 ACIL Tasman also identified three key markets failures in the current largely self-regulatory regime for the regulation of engineers: The information asymmetry which exists in the current model for the procurement of engineering services, where the purchaser cannot properly assess the quality of the service they are obtaining and could serve to drive a loss of quality in engineering services. Externalities which include impacts on health and safety or the environment, both of which have a real cost to taxpayers. These are what we have referred to previously as the consequences of engineering failure. Often not only costly, but potentially fatal. ACIL Tasman has identified the key estimated key benefits of the establishment of a national scheme as:
Efficiency gains ($207.6m p.a.);
They also state that these efficiency gains are estimated on the basis of improved productivity mobility of engineers, which we believe is of key interest to government in a time of acute engineering skills shortage. Reduction in large engineering failures ($13.2m p.a.); Reduction in botched engineering projects ($207.08m p.a.); Benefits relating to migrant engineers ($29.91m p.a.); Resulting generation of engineering construction activity by addressing skills shortages ($185.58m p.a.). The economic case for establishing a national registration scheme for engineers is compelling, and the urgency for its establishment is underlined by the emergence of a number of differing schemes in jurisdictions which will make what is a complex system for engineering registration in Australia more labyrinthine. Both the economic and public policy case means the time to act is now to establish a national registration scheme for engineers.
Notes 1
Australian National Engineering Taskforce, p17. ‘Realising an Innovation Economy’, ANET (2012), Sydney, p17.
2
Birrell, Sheridan and Rapson cited in Kaspura, (2011), p58. The Engineering Profession. A Statistical Overview, Eight Edition. ACIL Tasman (2012). ‘The Economic Basis of the Case for National Registration of Engineers in Australia – Executive Summary’. Canberra, ACT, p 11.
3 4
Ibid., p 12.
5
Ibid.
6
Ibid., p 13.
7
Ibid., p 1.
Supported by:
Endorsed by:
About this publication This report is prepared by the National Engineering Registration Board (NERB) in conjunction with Principled Public Relations and Public Affairs (PPRPA). While the statements made in this report are given in good faith, neither PPRPA, nor the NERB accepts responsibility for errors or omissions, or any loss or damage as a result of any persons relying on this report for any purpose other than that for which it has been prepared. All comments or questions relating to the content of this report should be directed to: Michael Bevan Registrar of National Registers Engineering House, 11 National Circuit BARTON ACT 2600 Tel: (02) 6270 6523 Email:mbevan@engineersaustralia.org.au
Erik Locke Director, Principled Public Relations and Public Affairs Level 13, 30 Collins St MELBOURNE VIC 3000 Tel: (03) 9650 0200 Email: erik.locke@pprpa.com.au