All these nightly news reports of the oversight failures in the pharmaceutical industry that allowed a so-called compounding pharmacy located just 20 miles down the road from where I live in Massachusetts to wreak havoc with tens of thousands of lives (including those who developed fungal meningitis from contaminated injections and those who are just frantically worrying about getting it) got me thinking about government oversight of the aviation industry. Or–in many cases–the lack thereof.

I have always thought that there are lessons to be learned from other industries, especially if we are sometimes too close to have sufficient perspective about the same issues affecting our own industry. You know that old saying about not being able to see the forest for the trees. Sometimes looking at other industries gives us that much-needed perspective. In fact, with the accident rate so low in aviation, it is appropriate to look at whether other regulated industries offer any lessons, so that we can learn those lessons without a painful burning hole in the ground. Certainly, there were lessons for us all in the lax SEC oversight of Wall Street that fueled the economic meltdown. (I’m still having a hard time understanding how no one went to jail for some of the stuff that went on.) Or the BP disaster that ruined so many people’s–not to mention marine–lives in the Gulf Coast region.

Sure, at different times of our lives many of us would have welcomed a little less government oversight. Certainly when I ran my own FBO at Logan International Airport, I did not welcome the sight of the FAA coming around. If nothing else, the agency’s presence slowed down our business for the day, responding to document requests or just walking inspectors around the premises. Fortunately, I never had to deal with an enforcement case against me or my company. 

But what about a world without government oversight? That is what the compounding pharmacy debacle brings to mind. Somehow these pharmacies fell between the cracks of FDA regulation, and no one in the public at large had any idea. Supposedly the state of Massachusetts was responsible, but clearly it wasn’t up to the challenge. According to press reports, the pharmacy was blatantly in violation of numerous quality control standards, to the point that fungal contamination was evident to the naked eye. 

Think that something comparable can’t happen with aviation? I think it can. We already have significant amounts of maintenance performed by companies with absolutely no FAA certificates and no FAA oversight whatsoever. Millions of people fly on scheduled airlines with maintenance performed by these unregulated entities. Does that concern you? It concerns me. In fact, it’s concerned me for a while. And I know I’m not alone. Other well-respected aviation safety advocates have expressed similar concerns.

Outsourced Service Needs Oversight

I’ve written and spoken a lot about my concerns regarding airlines outsourcing their maintenance, particularly to foreign repair stations, many in the developing world. As we all know, as maintenance on passenger airlines has moved farther and farther from the airline’s control, often across oceans and time zones, it has also moved farther and farther from FAA regulatory oversight. It’s troubling to have so much critical work performed with so little FAA review, especially unannounced inspector review.

In the old, pre-outsourcing days, inspectors regularly dropped by the carriers they were responsible for, reviewed paperwork and kicked the proverbial tires. Now, all major airlines contract significant amounts of their maintenance work to repair stations, many of them in parts of the world far distant from FAA offices. When the FAA does pay a visit, the inspections are usually–if not always–well coordinated in advance, removing any element of surprise and hence assurance that the inspection actually says anything meaningful about the repair station’s day-to-day operations. But at least these repair stations are certified, so they pass an initial FAA screening before they can operate as a repair station. 

So, as vexing as the problem of lax oversight of foreign repair stations is, of greater concern is the total lack of regulatory oversight of many uncertified contractors used by domestic, as well as foreign, repair stations to perform maintenance functions. This affects both airline and business jet maintenance. As the DOT Inspector General highlighted in a 2005 report, these uncertified contractors are doing more and more sophisticated–and safety-critical–maintenance work. From my conversations with people in the industry, that trend has not abated. In fact, if anything, to compete in a business where the customers (the airlines and other aircraft owners) are extremely price sensitive, the trend is growing.

Of particular concern to the IG in its 2005 report was the lack of quality control and oversight found in uncertified entities compared with certified ones. The FAA is obviously aware of the IG’s criticism but its attempts to address it to date have been lackluster. Even the proposed changes in the repair station NPRM issued several months ago–years in the making–do not go nearly far enough to address the dangerous lack of regulatory oversight.

In a bureaucratic attempt to shift the cost and responsibility for oversight from the government to the private sector, the proposed rule would make repair stations responsible for ensuring that an uncertified entity’s quality control is the same as its own. Really? Does the FAA think that’s what the Inspector General was getting at in his 2005 report? Don’t get me wrong: repair stations should be accountable for overseeing those to whom they contract work, especially if the entities are uncertified, but that doesn’t mean the government should totally wash its hands of its responsibilities for certification and oversight. Just think of the compounding pharmacy in New England. As I write we’re up to 30 dead, 420 infected and more than 14,000 at risk.