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Monday, 1 December 2003
Page: 23268


Ms O'BYRNE (12:36 PM) —I would like to support the comments made by the committee chair and thank all members of the committee for their participation. I also extend the committee's thanks to all witnesses and all those who provided a submission to the inquiry. On 18 June 2002, the minister asked the committee to inquire into commercial regional aviation services in Australia and transport links to major populated islands. The committee received 191 submissions and conducted hearings in Wagga Wagga, Adelaide, Kangaroo Island, Melbourne, Flinders Island, Launceston and Canberra.

The report contains a number of recommendations that I will present to the House, but before I do I must note the importance regional communities place on local airports. Regional airports are critical to economic and social infrastructure. To the business community, the airport facilitates quick access to markets for time sensitive and perishable produce. Indeed, regional aviation services are integral to Australia's supply chains—a point that cities often forget. The local airport has a significant social impact. Having the local aerodrome and knowing that there is easy access in and out of regional areas is an important comfort and is highly valued by isolated communities. The demise of our regional aviation services has the potential to set this country back 50 years.

The inquiry centred on a number of key issues affecting regional aviation services, the operating environment, government policies and the regulator. Regional aviation has been through a tough time. These tough times demand a higher level of management expertise to separate the emotional pull from the reality of making hard commercial decisions. Evidence provided to the committee suggests that the difficulties of some regional airlines arose from poor commercial decision making.

The committee recommends that both an awareness program and a program to improve business management skills be developed and implemented to encourage greater management. Whilst management training programs are available, there is very poor uptake. There appears to be a growing divide between larger regional centres with adequate and well patronised services and small centres with struggling or non-existent services. The committee heard evidence that inadequate air services can impede the development of a range of industries in regional Australia and that maintenance of safe and efficient airport infrastructure has been a challenge. The committee recommends either a new airport ownership subsidy scheme covering capital works and essential maintenance or that the government resume ownership and funding of all essential airports in communities with populations of less than 30,000.

The committee also recommends that funding for the remote air service subsidy scheme be maintained at least at the 2003-04 level. The challenges faced by island and remote communities in providing viable, safe, and efficient airports are made greater by the very nature of their physical location and population base. The government has a responsibility to ensure appropriate transport services are provided. Highways cater for fast passenger movement and fast freight movement, but for island communities air services are the only way to get time sensitive produce to markets.

The committee heard evidence that government policy has placed additional costs on the regional aviation industry, with a series of hidden taxes that are embedded in the cost of each ticket. It noted that where competition is not effective in delivering consumer benefits because of market failure, government intervention is justified to achieve economic and social objectives. The committee recommended that the government:

Strengthen the public interest test of the National Competition Policy by specifically requiring regional aviation and island transport policies to be assessed against the interests of rural and regional communities.

The committee also recommended that:

... the Department of Transport and Regional Services:

Verify the adequacy of regulation impact statements for amending aviation safety regulations prepared by the Civil Aviation Safety Authority; and

Assess that the cost impacts calculated are reasonable and justified, taking into account the importance of regional aviation to regional, rural and remote communities.

In addition to the cost of dealing with the introduction of new regulations, the committee recommended that the Commonwealth establish an aviation ombudsman. The duties of the ombudsman would include examining operational complaints, conducting independent surveys of industry and maintaining the confidentiality of respondents. These surveys would assess the effectiveness of the Civil Aviation Safety Authority's measures to improve the consistency of its interpretation of aviation regulations. I highly recommend to members of the House that they read the committee report and that the Minister for Transport and Regional Services embrace the committee's recommendations.


The SPEAKER —The time allotted for statements has expired. Does the member for Hinkler wish to move a motion in connection with the report to enable it to be debated on a later day?