Lawmakers say auto safety agency needs reform, not more funds

Reuters News
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Posted: Jun 23, 2015 4:49 PM

By David Morgan and Ben Klayman

(Reuters) - The U.S. agency that polices vehicle safety is not likely to get more money from Congress to overhaul its defective investigation system or deal with one of the most complex recalls in its history, lawmakers said on Tuesday.

The Obama administration has asked Congress to provide the National Highway Traffic Safety Administration's defect investigations office with an additional $20 million a year, tripling the $10 million budget it has had for most of the past decade.

The agency's head used a Senate hearing on Tuesday to again make the case for more funding, arguing the NHTSA has been overwhelmed by a record-setting run of large-scale safety recalls, including replacing about 34 million potentially defective airbag inflators made by Takata Corp.

Lawmakers of both parties, however, said the agency needs to reform itself first, even as they blasted Takata for its response to fatal accidents involving its technology.

“NHTSA isn’t following basic best practices and these are problems that can't be solved by throwing additional resources at the problem,” the Republican Chairman of the Senate commerce committee, John Thune of South Dakota, told NHTSA Administrator Mark Rosekind.

Lawmakers cited a report by the U.S. Transportation Department inspector general that found the NHTSA has ineffective managers, poorly trained staff and is unable to assess information from consumers and automakers about potential defects.

“I’m not about to give you more money until I see meaningful progress on reforming the internal processes within this agency,” Democratic Senator Claire McCaskill of Missouri told Rosekind.

Rosekind said NHTSA's plan is to undertake 44 changes to improve its operations within the next year, while working to remove 34 million defective Takata air bags from 32 million vehicles with replacement parts in short supply.

However, he told lawmakers the agency needs help.

“You’ve got too many complaints and not enough people,” he said of the eight screeners that handle 80,000 consumer grievances a year. “It’s just overwhelming.”

Rosekind told the committee the number of vehicles in the Takata recall could change because some with two air bags were double counted.

A Reuters analysis found the number could prove to be less than half the initial estimate of 34 million.

Democratic Senator Richard Blumenthal of Connecticut said he was concerned the focus on the NHTSA's problems could overshadow Takata's responsibility for air bag inflators that can expand too forcefully, spraying metal shrapnel into vehicle passenger compartments.

Blumenthal asked Kevin Kennedy, an executive vice president for Takata in North America, to commit to the establishment of a victims' compensation fund. Eight people have died worldwide from injuries suffered when Takata airbags exploded, according to U.S. regulators.

Kennedy said he would confer with colleagues at Takata and get back to Blumenthal within two weeks.

“Some may say legitimately that there’s blood on the hands of Takata executives who concealed and covered up,” he said a day after the committee's Democratic staff issued a report claiming the Japanese manufacturer might have put profits ahead of safety by stopping safety audits in a way that contributed to the recall.

(Reporting By Joe White. Editing by Andre Grenon)