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Monday, 4 June 1984
Page: 2436

Senator MacGIBBON(5.01) —I thank the Attorney-General for tabling this brief statement on the contract with Skywest Airlines Pty Ltd. It implifies and expands on the very sparse information we had before. There are a couple of points on which I should like the Attorney-General to enlarge. He said that the contract with Skywest is in two parts. First, there is a standing charge for 14 aircraft, plus a charge for flying hours. He added that the standing charge for 14 aircraft have a component that includes the profit to the operator. It follows from that that the flying hours must be done at cost. Would the Minister expand on the formula accepted by the Department of the Special Minister of State for the cost of operation? It is literally the direct operating charges of those aircraft, the cost of fuel, the cost of oil and the cost of engine hours flown as a fraction of the overhaul cost of that engine? Does the formula contain a component for the operator when compiling flying hours to replace components in those aircraft on the grounds that they are worn? Do the taxpayer and the Commonwealth have any defence against the contractor progressively upgrading the mechanical status of his aircraft and charging that against the Commonwealth?