FAA Uses NPG and SEP to Oversee Non-legacy Airlines

NPG and SEP are the main inspection processes that FAA uses to oversee  the safety of non-legacy airlines. Due to  resource constraints, FAA determined it would not be able to immediately  place the remaining passenger airlines in the ATOS program. A strength of this approach, consistent with findings in our past  reports, is that teams of inspectors are generally more effective than  individual inspectors in their ability to collectively identify concerns. FAA’s Oversight Process Includes Monitoring to Follow Up on Airline Actions Taken in Response to Findings

Another strength of FAA’s oversight of non-legacy airlines is that inspectors  monitor the actions that those airlines have taken in response to inspection  findings through subsequent inspections and participation in safety  partnership programs with the airlines. FAA’s  incorporation of system safety into its oversight process is incomplete, as  the agency continues to emphasize a nonsafety system-based process,  NPG, to identify most of its inspection activities. In addition, FAA lacks a process to  continuously evaluate SEP. As a result, most of the required inspection  activities are not prioritized based on risk. While NPG also includes  planned inspections, which have a risk-based element, these inspections  lack the structured approach to risk identification that SEP has. Adding SEP-initiated activities to the required NPG-identified  activities may increase the overall workload of inspectors. Fourth, for fiscal years 2005  through 2010, FAA estimated that over 1,100 inspectors of non-legacy  airlines and general aviation will leave the agency, with an average loss due  to attrition of about 195 inspectors per year. These  reductions will be accomplished through attrition. According to an FAA inspector, some inspections are  delayed due to lack of staff availability. However, the usefulness of FAA’s  system safety approach is reduced by limitations in the implementation of  SEP—such as FAA headquarters’ predominant focus on NPG, which has  led to only a small percentage of inspection activities being SEP-initiated;  the lack of training of geographic inspectors on SEP codes that could make  their inspections more useful to identifying risks during the SEP process;  and the lack of linkage to national goals and evaluations of SEP. Until SEP  is more fully implemented, it is clear that FAA’s approach to overseeing  non-legacy airlines is not largely risk based. With FAA operating under a hiring  freeze and the number of inspectors available for non-legacy airlines  possibly further reduced by attrition and the move of inspection staff to the  ATOS program, the need to maximize the effectiveness of inspection  activities in ensuring the safety of non-legacy airlines is even more critical. Objectives, Scope, and Methodology

The objective of this report is to assess the Federal Aviation  Administration’s (FAA) processes for ensuring the safety of a fast-growing  portion of the commercial airline industry—the non-legacy passenger  airlines. (2) What issues hinder the effectiveness of FAA’s  inspection approach? FAA’s Surveillance and Evaluation Process

	SEP Incorporates System Safety into FAA’s Inspection Oversight of Non- legacy Airlines

The Surveillance and Evaluation Program (SEP) is a process designed to  introduce a data driven risk analysis system for non-legacy airlines and is  guided by a Surveillance and Evaluation Assessment Tool (SEAT).
Why GAO Did This Study

The Federal Aviation Administration (FAA) uses the Air Transportation Oversight System (ATOS), which was developed around the principles of system safety, to oversee seven "legacy airlines" and nine other airlines. In this report, we refer to airlines that are not in ATOS as non-legacy airlines. Two other processes are used to oversee 99 non-legacy passenger airlines, which represent a fast-growing segment of the commercial aviation passenger industry and carried about 200 million passengers in 2004. The National Work Program Guidelines (NPG) establishes a set of inspection activities for non-legacy airlines. The Surveillance and Evaluation Program (SEP) uses principles of system safety to identify additional risk-based inspections for those airlines. GAO's objective was to assess the processes used by FAA to ensure the safety of non-legacy passenger airlines. GAO reviewed the strengths of FAA's inspection oversight for non-legacy passenger airlines and the issues that hinder its effectiveness.

What GAO Found

A key strength of FAA's inspection oversight of non-legacy airlines is the introduction of system safety concepts to some inspections, which FAA accomplished by adding SEP to its traditional inspection process, NPG. Although NPG has risk-based elements, it lacks the structured approach to risk identification found in SEP. Under SEP, data are used to help determine trends or problems. The SEP process uses a team of inspectors to identify inspection activities, which we have previously reported is generally more effective than the use of individuals due to their collective ability to identify risks. Under SEP, inspectors also ascertain risks internal to FAA, such as staffing shortages. FAA's oversight of non-legacy airlines further incorporates processes to ensure that inspectors follow up on airline actions taken in response to inspection findings. These efforts address several past GAO concerns, including that NPG did not allow FAA to identify risks and allocate inspection resources accordingly. The full potential of FAA's inspection program for non-legacy airlines, however, is not being realized due to incomplete implementation of its system safety approach and other challenges. The inspection workload is still heavily oriented to nonrisk-based activities, with 77 percent of inspection activities being identified through the NPG and the remaining relatively small percentage identified through SEP. The emphasis on NPG, including FAA's guidance that inspectors must complete NPG-required inspection activities, acts as a disincentive to identifying further inspection activities through SEP. Inspectors face workload challenges as staff lost through attrition may not be replaced due to a hiring freeze. FAA estimates that over 1,100 inspectors of non-legacy airlines will leave the agency in fiscal years 2005 to 2010. In addition, some FAA inspectors indicated that a lack of technical training on airline systems and equipment posed potential risks to the agency's oversight process. Finally, FAA lacks a process to communicate information to inspectors on how certain internal risks identified through SEP are being resolved. Moreover, FAA has not established a process to evaluate the effectiveness of SEP.