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Rural and Regional Affairs and Transport References Committee
Pilot training, airline safety and the Transport Safety Investigation Amendment (Incident Reports) Bill 2010

BERRY, Mr Tim, Director of Operations, Tiger Airways Australia

DAVIS, Mr Tony, Chief Executive Officer and President, Tiger Airways Holdings

RIX, Mr Crawford, Managing Director, Tiger Airways Australia


CHAIR: I now welcome Tiger Airways. Tiger Airways has lodged submission 14 with the committee. Would you like to make any amendments or additions to that submission?

Mr Davis : No, Chair.

CHAIR: If you would like to make an opening statement, we will proceed.

Mr Davis : Thank you, Chair. Tiger Airways Holdings is the parent company of Tiger Airways Australia and we welcome the opportunity to assist the committee with its inquiry. My own background is that I have worked in aviation for the past 25 years with companies such as British Airways, Gulf Air and British Midland. For the past seven years I have been running Tiger Airways. I will just make a few opening comments and then I will pass over to Crawford, who is the CEO of our business here in Australia.

Crawford leads a strong team and I have been very impressed with the high calibre and the experience of the pilots, cabin crew and employees that we have been able to recruit here in Australia. Safety is a critical component to business success but especially so in aviation and Tiger takes this responsibility very seriously. As a company we place a very high emphasis on safety. We have created a strong safety culture and we ensure that our employees have the confidence and the ability to raise any safety concerns they may have in a just and non-punitive manner. Safety management is built on a basis of continuous improvement and Tiger is committed to working with all regularity bodies to ensure the safety of our operation.

We are confident that our business model can and will be successful here in Australia and that real competition provides benefits to consumers and to the economy as a whole. Tiger Airways has already had a dramatic impact in the domestic market, causing air fares to drop by more than 30 per cent. We are committed to the long-term future of our airline in Australia. I will now hand over to Crawford who will go into a little more detail.

Mr Rix : Thank you very much, Tony. Thank you and, like Tony, I am pleased to have the opportunity to assist the committee in its inquiry. It really is my privilege to be here as the CEO of Tiger Airways in Australia and to be the accountable manager for our Australian business and to be responsible for our AOC, air operators certificate. I have slightly more experience than Tony, I have 33 years in the aviation industry. I started my career as an aircraft dispatcher, if you like at the very bottom of the rung, and apart from three years in the media I have worked for airlines throughout my career. Most recently I worked for the British Midland Group in the UK. I was managing director of their regional airline similar to the Rex type operation for two years and then managing director and accountable manager for the low cost airline bmibaby for the last four years of my career with BMI. Despite my accent I was very nearly an Australian. My parents were ten pound Poms in the fifties but returned to Scotland six weeks before I was born. I am very proud of our Australian workforce as Tiger Airways has some of the best qualified and the most experienced pilots in Australia. We have successfully operated for almost four years now and safely carried in excess of seven million passengers. All of our flights in Australia are operated by pilots and cabin crew based in Australia. Indeed we have been able to attract many expatriate Australian pilots that have chosen to return to Australia to fly with Tiger Airways.

At Tiger Airways safety underpins everything that we do as a business.

CHAIR: Could I just intervene for a second?

Mr Rix : Yes.

CHAIR: The News Limited photographer would like to come in and take some photos; does that trouble you?

Mr Rix : Not at all.

CHAIR: Thank you very much. You can continue, just do not take any notice of them.

Mr Rix : I have got a great face for radio. As accountable manager I am ultimately accountable for the AOC and I take this responsibility very seriously. As Tony said earlier, safety is both personal and a corporate priority. Given the opportunity to make an opening statement I would also like to put on the public record some brief comments in relation to the ongoing CASA process. It is important to state that all of our operations and our growth in Australia has been authorised by CASA. The AOC was first issued and approved by CASA in November 2007, on time and on our very first attempt. Each additional aircraft we have brought into our operation, and each additional base we have added to our network, has required an AOC variation to be approved by CASA. The most recent variation to the AOC to increase the size of our fleet to ten aircraft and open our latest base at Avalon Airport was approved just a few months ago in November 2010.

The committee is aware that in March CASA issued Tiger Airways with a show cause notice. Whilst the notice requested a response to a number of management oversight and administrative issues, it did not raise any issues that represented a serious or imminent risk to safety or any issues that related to the physical maintenance of our aircraft.

The show cause notice process is designed for CASA to raise such concerns with the operator based on their knowledge and understanding of the issues. The operator is then given the opportunity to clarify and correct any misunderstandings or inaccuracies. Tiger responded to CASA on 13 April in full and in detail to all of the concerns raised in the show cause notice.

Senator XENOPHON: What date was the show cause?

Mr Rix : 23 March.

Senator XENOPHON: So you responded within?

Mr Rix : Twenty-one days.

Senator XENOPHON: Twenty-one days.

Mr Rix : Yes. Where CASA has made suggestions in relation to improving processes and oversight Tiger has taken immediate action and responded proactively with additional resource. For example, we have recently made changes to the structure of our operations department, including the recruitment of additional maintenance oversight management in Melbourne to increase our local workforce. These roles were previously located in Singapore. I cannot state strongly enough today that Tiger Airways is fully committed to operating a safe and sustainable airline in Australia. If it was not, I would not be here. Tiger has a robust safety culture. I have insisted that we have an open and transparent culture of reporting all incidents and potential incidents both internally and to the relevant regulators, whether that is CASA, the ATSB (Australian Transport Safety Bureau) or the OTS (Office of Transport Security). We believe that such an open and transparent safety culture is central to ensuring safe skies for all.

Given the process is ongoing, I am limited in what else I am able to discuss in relation to the show cause notice, at this stage. We look forward to putting the show cause notice behind us and continuing to build a safe, sustainable airline in Australia. I welcome the opportunity to provide evidence to the committee and would be happy to answer further questions that you may have this morning. Thank you.

CHAIR: Senator O'Brien?

Senator O'BRIEN: I have no questions at this stage.

CHAIR: It is a great curiosity—and I think as I have said before, I would not for the life of me own an airline—to keep airlines flying safely and flying financially sound with the expectation of the flying public that it is a very cheap thing to do. Trains run at losses; it costs $5 or something to go from the Southern Highlands to Sydney and the government picks up the tab. What is the secret to cutting airline flying costs by 30 per cent and still being financially sound? Could I begin with asking you what the age of your fleet is? Did you buy the 10 planes all brand new?

Mr Rix : To answer your last question first, our aircraft actually were all delivered new to Tiger Airways from the Airbus factory in Toulouse. The company is seven years old so none of our aircraft are more than seven years old. In fact, we have just taken delivery of two brand new aircraft in the last week. None of our aircraft are old; they are all brand new, all with the latest technology, all with the current modifications. So that is the situation. Tony, do you want to add anything there?

Mr Davis : Perhaps I will respond to your earlier point. As Crawford and I have both said, we have worked in the industry our entire lives and the airline business generally involves a high investment capital. What we have tried to do with the low cost model is really strip out the pieces of the equation which are discretionary for most passengers. If you look at the total cost, a lot of the costs the airlines carry are actually to provide services to a very small number of people. We have said that we are not going to try and produce a product which is attractive to everybody; we will attract a certain portion of the population, people that are looking for very simple journeys, they are just going from A to B, and they are not looking to check their baggage half way around the world.

I had a letter from someone the other day in WA who was very upset that we would not take their poodle on the aircraft because we do not carry pets. Well, that is a decision we made that we will not transport pets in the aircraft because that adds another layer of complexity, and so on. The real basis of the model is to make it very simple. You make choices. For example, in Australia as well as having a brand new fleet we only have one type of aircraft which means we only have to train the pilots to fly one type of aircraft and the cabin crew only have to learn how to work in one type of aircraft. I think all of the other Australian airlines have multiple aircraft types. That obviously means it is cheaper for us.

We do get high efficiency. We schedule the operations so that we get as many flights a day out of each aircraft as we can. So, we make choices about where those aircraft fly. We do not night stop the aircraft anywhere else other than their home base. The crews like that because it means they sleep in their own beds; they come back to base every day rather than packing a suitcase and going around Australia for a week. The essence of the business is simplicity and efficiency. It is also about heavy upfront investment. The fact that all these aircraft are brand new means that we have put more money in up front but we do that because the underlying operating cost is then lower.

CHAIR: In terms of your pilot training, do you pilfer them from other airlines or do you train them?

Mr Davis : Bluntly, we pilfer. Tim probably can speak to this better.

Mr Berry : I would not use the term pilfering. We look for our pilots with high levels of experience. By the very nature of that strategy we employ pilots who have worked for other people. There is a natural progression, if you like, of pilots through the industry in Australia. People will start perhaps flying a turbo prop and then want to move onto a jet so we take pilots from that stream. We have only been in existence for three years and our early experience was that we looked to recruit pilots who were mature and who were experienced in other parts of the world. There were a lot of Australian pilots who were looking for the opportunity to return home and so we were very fortunate in that we were able to recruit very experienced pilots from other parts of the world. That experience sits within our organisation to this day.

CHAIR: You do not actually take on board bush pilots and train them, you take on experienced pilots and endorse them? Do the pilots you take on have to be endorsed in your aircraft or are they already endorsed?

Mr Berry : As part of the entry requirement into the company they have to have obtained an endorsement on our aircraft type. We do not recruit bush pilots in the broadest sense that pilots will have gained their experience in the turbo prop market.

Senator STERLE: Can I follow on that please, Chair. Mr Berry, taking it on notice, could you provide the committee with a breakdown of where your pilots have been recruited from? Could you do that for us as we have requested from other companies?

Mr Berry : Yes, I can do that.

Senator STERLE: Thank you, and that includes international, regional and other airlines.

Senator XENOPHON: I just want to cover a few areas that relate to pilot training, cabin crew fatigue management and the show cause issue. I understand you have got some constraints. I should disclose I do fly Tiger Airlines. I have not been held up more than 40 minutes. I find it interesting that I get many calls and emails from pilots who are unhappy about aspects within their airlines and I have not had one from a Tiger pilot yet. I do not know what that means but I think it is interesting.

CHAIR: Is this a paid advertisement?

Senator XENOPHON: No, no I am just saying that I find it interesting.

CHAIR: Are you declaring an interest?

Senator XENOPHON: I think it is interesting that I have not had any complaints from Tiger pilots.

CHAIR: No, come on, we are only doing a bit of leg pulling here.

Senator XENOPHON: I will go to the issue of pilot training and where you get your pilots from. Following the Colgan Air crash in the United States, Congress passed an act of parliament that with very few exceptions, a pilot of a large passenger aircraft of I think 40 or 50 seats or over would have to have 1,500 hours experience before they could get into the cockpit or even the right-hand seat, the first officer's seat. What is your view of that proposal to have a minimum mandated requirement of experience and also the quality of experience for a large passenger aircraft?

Mr Rix : Can I ask Tim to answer that question, please?

Mr Berry : I think this goes back to our original submission, and I think this was the key driver for us wishing to engage with this process. Fundamentally the key determinant, in my judgement, about the safety outcome is the value of the training that the pilot has received. A blunt measure that says the pilot must have 1,500 hours is, in my judgement, simply a blunt measure. The better measure is the quality of the training that he has received.

Senator XENOPHON: You can have high quality training but I think you would not want to have someone with 50 hours or 100 hours flying experience in the right-hand seat though, would you?

Mr Berry : No. Within the cadet pilot training schemes, the pilot does in general, even if they start with no flying experience at all, get to around about 300 hours before they would find themselves in the right-hand seat of a jet aircraft.

Senator XENOPHON: Tiger does not have a cadet pilot training scheme does it?

Mr Davis : Our threshold at the moment is 2,000 hours, so it is actually in excess of the 1,500.

Senator XENOPHON: So is company policy not less than 2,000 hours for the right-hand seat?

Mr Davis : Yes. I think the concern is, and this is why the debate is important and relevant, that clearly as an industry we want to ensure that there is a good supply of high calibre, highly qualified pilots as we go forward. To take Senator Heffernan's point around bush pilots, just flying around the bush for 1,500 hours may not make you a good pilot to come into an A320 operation.

Senator XENOPHON: I understand that, but does that mean that it is a balance. Further to what Mr Berry said, is there a balance between the minimum number of hours and the quality of that training; is it sort of a hybrid of the two?

Mr Davis : Exactly. I think our view would be the better the quality of the training and the more tailored and appropriate it is, perhaps that means the reduction in hours is more appropriate. If someone has been tailored in their training to operate our type of aircraft from the very, very early stages of their experience and they have done very intensive training on that aircraft type, then that might justify a lower number of hours than someone who just came in with a lot of experience but not necessarily as tailored.

CHAIR: In terms of the low number of hours, one of the intriguing things that we have come across—and obviously the public wants to be assured that the pilots know that they are doing. The only time you really find out if you know what you are doing is when something goes wrong. The multipurpose licence where you qualify or you train people to fly aircraft in the right-hand seat of one of your airliners but they are not qualified to fly a light aircraft, how do you overcome that? I have to say, there is some sense in learning to ride an 80cc motorbike before you get on a 1000cc motorbike. Do you blokes overcome that by just selecting higher up the pecking order, which would make sense to me?

Mr Rix : I think actually Tim's experience is pretty vast in this area having been through the previous hearing and having almost been through a cadet program himself and then going through ultimately to become an AFE and then effectively now our director of operations here. I think it is probably wise if Tim just takes you through the process now. He will be able to explain how he approaches the business and how we approach the business together to make sure that we get the highest quality at all times in our airline. That does not just apply in Tiger; it has applied in previous airlines that I have worked for. I think this is a moment for that if you do not mind.

Mr Berry : For us the discussion is to some extent academic because we are in the fortunate position that we are a small organisation, our recruitment needs are small and we are able to source people into the organisation of the kind that I described earlier, people who have had the experience either in other jet operators or on the turbo prop. However, as I said earlier on, my interest in this area really stems from the cadet pilot schemes. For over 20 years now these cadet pilot schemes have been flourishing in Europe. They are the primary source of pilot recruitment into airlines such as Lufthansa, British Airways, Aer Lingus. The cadet pilot entry program is a well proven product. The development of that in terms of that in terms of the MPL is something that it has been progressed internationally. It had its roots in ICAO, the International Civil Aviation Organisation. These schemes are well thought through and they deliver a first class product. They are designed to detect individuals through the process who are not first class and move them to one side. So these schemes are very well tried and tested. As I said earlier on, we are in the fortunate position of being able to say that we do not need to engage with that. We might need to engage with that at some point in the future but I think we can express an objective view on the matter.

To go back right to the beginning of this inquiry, my personal experience is that I was sitting in the right-hand seat of a four engine transport aircraft when I had 300 hours of experience. The reason I was doing that was because I was in the military. It is absolutely accepted, as it has been for a very long time now, that military pilots receive first class training and it enables them to go into combat with a few hundred hours under their belt. It is essentially establishing the principle that the key determinant in terms of the effectiveness of the pilot is his training.

Senator NASH: If the 1,500 hours was to come in, is there potential for it to actually have a perverse outcome because the requirement would simply be the hours then there would not be the attention to the detail of the quality of training?

Mr Berry : I think there are two aspects to this. Firstly, if there was to be a blanket requirement for 1,500 hours then you would immediately deny Australian aviators with less than 1,500 hours the opportunity to work in Australia. They would be able to find jobs in Europe because the systems in Europe would not have that. So they would be able to move away from Australia and work. At the same time, you would develop a hole in the Australian aviation market which would need to be filled from elsewhere. That is the first potential perverse outcome. The other perverse outcome goes back to the bush pilot. The Australian bush pilot wishing to seek employment in Australia under that kind of rule would need to do his training, go off and fly in the bush somewhere to gain his 1,500 hours and then work his way into aviation that way. Whilst pilots are flying in the bush, and I do not wish to denigrate anybody in this discussion, but it is a fact that—

CHAIR: That is not a slur.

Mr Berry : you are flying by yourself, you are not under the guidance of an experienced pilot sitting in the left-hand seat and you are simply gaining your own experience. I go back to again to my earlier evidence comparing it to learning to drive a car. The point at which you are at your peak probably in terms of your control of the car is the day you pass your driving test. From that point on, we like to think we get better, but generally our performance deteriorates. Flying by yourself is not the best way to learn. The best way to learn about how to fly an aeroplane is to be well trained and then to obtain your guidance from an experienced pilot in the left-hand seat of the aircraft. To your point, I think that if there was a blanket requirement for 1,500 hours it would have a perverse outcome.

Senator NASH: Thank you.

Senator XENOPHON: I just want to throw in this issue of pilot training. A number of pilots have expressed concern about a cadet scheme that one of the other airlines is looking at where it could be as little as 150 to 200 hours experience. They are saying that if you are in a sticky situation, if it is lousy weather, they want someone with more experience. They do not want to have to be supervising every aspect of that cadet. Or, if God forbid, the pilot has a heart attack, then you have a 180-seat aircraft under the control of someone with as little as 200 hours experience. What is your view to having a cadet scheme with a couple of hundred hours experience? Compare that to, say, the Qantas cadet scheme where they do have people with a couple of hundred hours experience but they are second officers; they sit at the back of the plane and they observe and they are not in the right hand seat. How do you get the balance between your minimum threshold of 2,000 hours, but should there not be some mandated minimum for a large capacity passenger aircraft? Bearing in mind that you need to have quality controls as well.

Mr Berry : I think it is absolute to all of the things that I have said that the training within the 200 to 300 hours has to be of the absolute best quality. All of the training schemes that there are rely on competency assessments as you progress through the process. When we take a pilot on, we as the airline obviously require him to have a licence which he will have gained through his 200 or 300 hours, but we then put the individual through our own processes to determine his competence.

Senator XENOPHON: Flight simulators?

Mr Berry : He would go through simulated training.

Senator XENOPHON: You have them here? What do you use? Do you use them out of Melbourne? Where do you have them?

Mr Berry : Yes, we use the training facility in Melbourne. He would go through a process of simulated training, and he would then go through the process of training on the line. Each of those processes, within the context of the scheme that I have described, must be tailored to the needs of the individual. If I am taking on a pilot with 20,000 hours experience on the aircraft, the training that he will receive will clearly be different from somebody who has 200 or 300 hours. Fundamentally the airline will monitor the process of the individual through their simulated training, which will include testing, and then they will go through the process of line training. Line training is designed to look at the performance of the individual on the line. Again, that is tailored.

Senator XENOPHON: Let us go back to this key issue. One of the terms of reference of this inquiry is whether we should go down the path of the US Federal Aviation Administration Extension Act 2010 where there should be 1,500 hours for a large capacity passenger aircraft. This basically refers to jets, anything more than 50 or 100 seats; a large capacity aircraft such as the aircraft that Tiger flies around the country. Should there be some minimum threshold? Is the 150 or 200 or 300 hours that another airline has been proposing for a cadet scheme adequate, where as soon as you have your commercial pilot's licence you could technically be in the right-hand seat? Where do you draw the line before you have on one of your aircraft a person in the right-hand seat?

Mr Davis : Firstly from our perspective this is a hypothetical at this stage, because Tiger does not have a cadet scheme and we are not proposing a cadet scheme here in Australia. We currently have a threshold of 2,000 hours, as I mentioned, for the first officers. I think the point we are trying to make is that it is a balance between the two. There needs to be appropriate, vigorous, fit for purpose training that gives you candidates and pilots that are of the right standard so that, in your example, they do not make a mistake when the weather is bad and things are not going well. Whether that is an arbitrary hours number or whether it is a combination of an hours number and appropriate training that gives satisfaction for the competency, I think we are saying it is probably a combination of the two. I do not think we are in a position right now to say 1,500 is the right number because of those other components that we would want to build in. I think maybe the easiest way is perhaps if we could follow up with you. Because we do not have a cadet scheme, we have not as a corporation said okay, it has to look like this. It is certainly something we are looking at.

Senator XENOPHON: I understand, at the moment you have a minimum 2,000-hour requirement for a first officer?

Mr Davis : Yes.

Senator XENOPHON: Is that something that you tell CASA or is that just an internal thing within in your organisation?

Mr Davis : I believe that is a company decision.

Mr Berry : Yes, it is just internal.

Senator XENOPHON: So there is no requirement for you to say to CASA, by the way our minimum requirement for the right hand seat is 2,000 hours?

Mr Davis : No, it is a company decision.

Senator XENOPHON: There are no plans to change that minimum of 2,000 hours for your operations?

Mr Davis : No.

Senator XENOPHON: If you did, how would regulators know, for instance?

Mr Berry : It is not something that is regulated. We would consider that within the context of our safety system. We introduced 2,000 hours for a reason and we would need to understand within the context of our safety system whether it is reasonable and appropriate to move away from that or not.

Senator XENOPHON: Hypothetically if CASA regulations changed to say, if you were going to go below whatever your benchmark is, whether it is 2,000, 3,000, 1,500, 1,000, whatever it is, that you would just have to let them know as a matter of course, you would not have a difficulty with that?

Mr Rix : We would do a risk assessment, a thorough risk assessment of what the risk was to our business. That is what we would do if there was any business change. That is a process that we go through. We would share that with CASA.

Mr Davis : To your question, yes, we would notify CASA if there was a requirement.

Senator XENOPHON: That would not be an onerous or unreasonable thing? Yes, sure. Do you have pay for training for your pilots?

Mr Berry : Pay for training?

Senator XENOPHON: Pay for training in the sense that there are some airlines where the pilots have a debt with the airline and they have to pay off that debt for their training in terms of their endorsement?

Mr Berry : No. I will just expand if I may; basically a pilot needs to join us with an A320 type rating, so there is a cost to the pilot but that is not managed through the organisation. It is a simple qualification.

Senator XENOPHON: So there is no indentured arrangement or any loan arrangement between Tiger and the pilots?

Mr Berry : No.

Senator XENOPHON: They have to come ready with a licence?

Mr Rix : Yes.

Senator XENOPHON: Just going to the issue of fatigue management, we have heard evidence in relation to back of clock operations with another airline on both Singapore to Darwin and Darwin to Singapore, and from the east coast to Perth. There have been some complaints from pilots in relation to that. Does Tiger have back of clock operations from the west coast to the east coast and vice versa?

Mr Rix : Yes, we do. Tim, would you like to answer?

Senator XENOPHON: Further to that, what fatigue management systems do you operate? FAID is one, but there are others. I think Virgin operates with a number of measures. How do you manage the issue of fatigue? Because it has been an issue other pilots have raised.

Mr Berry : I am not able to give you any autobiographical detail myself, but I am a pilot and a former policeman, so I like checklists and I like evidence. In terms of—

Senator XENOPHON: I will not call you governor or anything.

Mr Berry : In terms of our safety system, there are seven elements in the system. If you look at the safety system itself or any element within the safety system, you should be able to identify these seven items. First is management commitment; second is the safety culture; third is a system of reporting; fourth is a system of identification; fifth is hazard identification; sixth is risk assessment; and seventh is training. That is the checklist which we apply to any safety items that come up. In terms of the evidence to support that in relation to fatigue, are we committed? Yes, we are. We say we are committed, but have we done anything about it? Last year we introduced a rostering protocol for our cabin crew. It is fairly basic, but it puts some rules around the way that we manage the—

Senator XENOPHON: Could you provide a copy of that protocol?

Mr Berry : Yes.

Senator XENOPHON: Thank you.

Mr Berry : We put that in place for our cabin crew, and as a consequence of that we saw the number of reports of fatigue from cabin crew remarkably reduce.

Senator XENOPHON: From what to what?

Mr Berry : Since the beginning of 2010, from pilots and cabin crew we have had 17 reports of fatigue against 76,000 rostered duties.

Senator XENOPHON: This includes the pilots?

Mr Berry : That includes the pilots. Within that number we had 11 reports from cabin crew. We recognise that that is possibly the tip of an iceberg because the last thing you want to do when you are feeling tired is sit down for half an hour and write a report about it. We recognise that fatigue is an issue and that we need to do something about it, so we introduced the protocol for the rostering of cabin crew in 2010. We have just concluded the EBA negotiations with our pilots, and that includes a rostering protocol which provides additional layers of protection above and beyond the regulation. So, we are committed. We have a just culture.

Senator XENOPHON: Before you go to just culture, what fatigue management systems do you have? FAID is one of them but the office of the transport safety regulator New South Wales is quite critical of the limitations of FAID. Are you familiar with that, Mr Rix?

Mr Rix : Yes.

Senator XENOPHON: I am glad you are. Some other airlines were not. There are criticisms of that from the office of transport safety regulator and I think that was in relation to train drivers or all transport operators. What advice do you get to have the best fatigue management system?

Mr Berry : I am sorry that I am making my answer a little bit long-winded, but in terms of the risk assessment and hazard identification elements of the answer, we use manual processes. Our rosters are produced within the roster protocols. We use manual processes of checking that, basically people sitting down and looking at rosters, and judging whether the output of the rostering system is reasonable on the basis of simple human judgement. We do not, at this present time, use any software tools to analyse rosters. We have FAID under consideration and we have SAFE, which is a European based system, under consideration, and a couple of other matters as well. There are airlines in the world that are much further down the track of fatigue management than we are, and are leaders in the field. To get to the state of the art position in terms of—

Senator XENOPHON: Are you talking about the software?

Mr Berry : No, I am talking about the software being a component part of their fatigue management system. So they use FAID but they recognise that it has limitations, because FAID only considers what the person does while they are at work. It does not consider the broader aspects of what might drive fatigue. For example, a pilot might have a perfect roster but he has three-year-old twins. In the state of the art systems in terms of fatigue management, the fundamental objective is to ensure that the crew member is not fatigued, and that must therefore consider aspects beyond the roster. If you are moving from where we are into a state of the art situation, we need to consult with those organisations to get the best quality advice on where we move to next.

Senator XENOPHON: Just following up on that, if a pilot says that was a pretty rough route for whatever reason, they might have three-year-old twins or whatever, do they have to take a sick day or do you try and accommodate them? Other pilots have told me they have had to take sick days off to try and deal with their own fatigue.

Mr Berry : This comes to the cultural aspect, and the culture in our organisation is that a person who calls in fatigued does not phone their manager, they simply phone our operations centre. They tell the operations centre that they are fatigued. They are taken straight away off the roster and we bring on a substitute. There are no recriminations.

Senator XENOPHON: How often does that happen?

Mr Berry : We have had 17 reports, so we are talking about one—

CHAIR: Six of them are aircrew?

Mr Berry : Correct. Sometimes those are events that are reported after the event, if you like, so not each one of those necessarily led to a person coming off the roster. The policy is very clear that if a crew member is fatigued they report the fact that they are fatigued prior to the duty, they are removed from the duty, we replace them, we ask them to report the matter, we carry out an investigation, and there are no recriminations. To your point, Senator, that is not treated as a sick day. It is just simply that they are off the roster.

Senator NASH: Just to clarify, did you say 17 was out of 76,000?

Mr Berry : Correct.

Mr Davis : Perhaps this comes to the model again. We only have a couple of overnight flights a day. It is a very small part of the operation. As I mentioned earlier, the other thing that helps in our type of operation is that there are no night stops away from your base. Everyone is generally flying to and from their home, and they go home and they spend time with their family, and they sleep in their own bed. It is not as disruptive to your sleep patterns as crossing time zones, then checking into a hotel, trying to get some sleep in a hotel—

CHAIR: Going down to the bar.

Mr Davis : I would not wish to speculate, Chair.

Senator NASH: The Chair is speaking from personal experience.

CHAIR: On the back of the clock operation do you have, like some other airlines, a sort of a snooze protocol for pilots on the transcontinental flights?

Senator STERLE: What is a snooze protocol?

Senator XENOPHON: It is called a controlled rest.

CHAIR: A controlled rest. You do not have that?

Mr Rix : We only operate with two pilots, so I do not think it would be a good idea for our operation.

CHAIR: We could tell you some stories of why it is not.

Mr Rix : That is fine.

Mr Davis : You need to tell me which airlines.

Senator XENOPHON: If it is an overnight flight there is a controlled rest. One of the airlines has a controlled rest where the pilots have a controlled break of half an hour. We have heard evidence on that. I will go to the issue of the show cause notice. Mr Berry gave evidence a number of weeks ago. The principal reason why you are back here is because it is unusual for a major airline to have a show cause notice. It has been put to me that the formalisation of dialogue between an airline and the regulator, CASA, into a show cause notice may indicate a lack of satisfactory progress in terms of that dialogue between the regulator and the airline. Do you consider that is the case here?

Mr Rix : To be honest, I think the dialogue in general has been okay.

Mr Davis : I would go further. I would say my knowledge of the interaction is that the dialogue between the airline and CASA has been very good. I think, as I mentioned earlier, Tiger has a very open and robust reporting culture. We do share with the regulator pretty much everything that is going on in the business. We submit data to CASA on a regular basis in terms of the operations that are ongoing.

Senator XENOPHON: And to the ATSB, presumably?

Mr Davis : And to the ATSB.

CHAIR: Could I just interject there? Are you satisfied that there are clear lines of communication and function, as opposed to dysfunction, between ATSB and CASA?

Mr Davis : Our experience has been that there have been occasions where there does seem to be some confusion. In answer to your question, perhaps there is some ambiguity between the reporting lines. Certainly in terms of investigations and process being completed, we have had experiences where there does seem to be parallel tracks, where CASA and ATSB are both looking at something, and perhaps one agency comes to a conclusion before the other. I think some additional clarity in that area would be helpful to the industry as a whole.

CHAIR: Thank you.

Senator O'BRIEN: Can I follow on now that you have raised the issue of the show cause notice? I have always had the view that an organisation being asked to show cause why their air operating certificate ought not be removed is the second most serious thing that can happen between the airline and the regulator, the most serious being the removal of the AOC. I know you have to be very careful in how you answer this but from your evidence so far this morning I am getting the impression that you have some doubts in your mind about the issues being raised warranting the removal of the AOC if you did not satisfactorily answer them. Do I correctly understand you?

CHAIR: I advise that at any time during the hearing if you indicate you would like to go into camera, you may.

Mr Davis : I was going to suggest that the process is ongoing. There have been concerns raised, as we have acknowledged. We have also pointed out that within 21 days we responded very clearly and in a detailed way to those concerns. As we have said in our evidence, the issues raised with us were administrative and management and oversight issues. We have also made clear that where there were some recommendations to improve process in the concerns raised by CASA in terms of those areas, we have changed some of the procedures; we have moved jobs from Singapore down to Australia.

Senator XENOPHON: When did that happen, having jobs here in Australia compared with Singapore? Was that maintenance?

Mr Davis : It was maintenance oversight. It was the planning. What I was going to say is the show cause process is something we have taken very seriously. Clearly it is not something that we expected.

Senator O'BRIEN: You would, would you not? As I say, it is the second most serious thing that can happen. The reason I am asking these questions is it has been suggested to me that issuance of show cause notices is becoming somewhat routine. You would not necessarily know that, and that is why I am asking you about your process. Cutting to the basic issue, really what I want to find out is are these issues that came out of the blue or were they ongoing consultation issues between you and the regulator?

Mr Davis : As I said earlier, it is an ongoing process. It is probably not appropriate, certainly in public, for us to go into the detail.

Senator O'BRIEN: No, I am not asking you to go into the detail about the issues at all. I do not want you to do that. I am only asking whether the process is one that has emerged quickly or whether they are all issues over which you have had dialogue with CASA over time.

Mr Davis : It was really a long period of time. In terms of your earlier point regarding whether show cause notices are becoming more routine, it is part of the CASA process, it is part of their mechanism for ensuring compliance. We said in our evidence that we are keen to get that process behind us and back onto a normal footing. However, it is one of the ways that CASA ensures that the things we need to do, we do. We think we do them, and we have shown to CASA why we think that is the case, and hopefully their investigation will come to a conclusion shortly and we can move on.

Senator O'BRIEN: I understand why you would have to be very careful in how you would answer my questions. The purpose of my question is about the process of issuance of AOC, and if they are becoming somewhat routine whether that is the best use of what is clearly, as I said, the second most drastic thing that the regulator can do in relation to an AOC holder. That is the purpose of my question. To follow that, given that your organisation is in the position where you have effectively been outed, as it were, as having had a show cause issue, do you believe that there ought to be a process where as a matter of course the fact that a show cause has been issued ought to be displayed on the CASA website for every case, for every AOC operator who has been the subject of a show cause? Or do you think you should just let the process run and hopefully not have someone reveal the fact in a process like this or in some other way or in a newspaper or something like that?

Mr Davis : My own view is that a more productive process would have been that decisions and determinations are issued. The way the show cause notice is used by CASA currently is as an investigation. It is a series of observations or interpretations that CASA has. The process of the current system is that the operator then has a chance to say either they disagree with some of those things, or the facts may not be correct, or the way it has been reported to CASA may not be correct, because obviously the source of the information may be inaccurate or inappropriate. My own view is we have to split between what is an investigation, fact finding, making sure that all the proper evidence is looked into, and what is a determination where that has been investigated and an outcome has been reached. I think the determination side of the process is very clear. It is public knowledge. The danger with the fact that an investigation is underway being leaked, or made public, is that people will jump to conclusions or prejudge the outcome and prejudice the process, and I think that would be unfortunate.

We have said many times to the committee that we believe very, very fully in a just culture of reporting. We need our employees and our service providers to be very open and honest with us, and they need to tell us everything that they are concerned about. If there becomes a fear of recrimination or punitive action just for reporting things that may have actually been helpful, I think that would be counterproductive.

If people stop submitting data and they stop telling us and the regulator what is going on, then problems just get buried and we only find out about it when it is too late. I think an open, just culture which encourages reporting, which encourages people to put their hands up and say, 'I am not sure, I may have made a mistake, can you look into it and see if I made a mistake,' is the culture we need in aviation.

Senator O'BRIEN: What I am taking from your answer is that you think it ought to be, in effect, in camera, and a process that an AOC holder and CASA can be confident will remain in camera rather than it being a public process?

Mr Davis : Yes, that is correct.

Senator O'BRIEN: I have other questions but I was following that point.

CHAIR: There has been a suggestion in earlier hearings of some legislative protection for that process. Do you think that is necessary? Not so much like the whistleblower legislation but as someone who has a concern owning up to their concern and not getting their head blown off, in other words.

Mr Davis : I think it is fair to say that for individuals, particularly employees, who are doing the right thing and putting their hands up and saying, 'Look, I am not sure if this happened,' or 'I saw this and I am not sure if I saw it right but you might want to look into it,' the fact that this process has become public before any outcome has been reached inevitably leads to people being a bit nervous about what they are saying. I think anything we can do to strengthen the process to encourage open communication is a good thing. CASA can come into our organisation any day, any hour. Whenever they choose they can come in and audit us and investigate us. There is no inhibition on that. If that process of continuous assessment becomes subjected to external critique, I think it will lead to a culture where people will try and perhaps be less open with the information, and I do not think that is helpful.

CHAIR: You may have had some experience with this but you may not have. The lines of communication between ATSB picking up on something and dealing with it and CASA, because of the dysfunction in the line of communication from ATSB to CASA, having a different interpretation of what that was all about, do you have any thoughts on that?

Mr Davis : As I mentioned, we have had experiences where both bodies have been involved and different tracks have occurred. Clearly any effort by ATSB and CASA to coordinate their activities better or potentially through changes of legislation be forced to coordinate their activities better, would be helpful to the industry. We have certainly had experiences where ATSB and CASA have both been notified of events and the process seems to have taken on different tracks, and I do not think that is particularly helpful.

Senator XENOPHON: The ICAO guidelines on occurrence reporting talks about the protection of reporting personnel:

The person filing a safety report needs to have the strong assurance from the regulatory authority and the employer that prosecution or punitive actions such as suspension of licence will not be sought unless the unsafe act is deliberately committed or gross negligence is demonstrated.

Do you support that?

Mr Davis : Absolutely.

Mr Rix : It is fundamental, I think.

Senator XENOPHON: The enforcement manual of CASA talks about the issue of procedural fairness so there is obviously a natural justice provision there. Also in the guide it says:

Section 6.6 below provides guidance on the procedures to be followed in relation to 'show cause' notices (SCNs). It should be remembered that the SCN is generally only one part of CASA's 'show cause' process, the other important part being the offering holding of a 'show cause' conference.

Are you able to indicate whether you have had a show cause conference with CASA further to the initial show cause notice?

Mr Rix : Yes, we have and at that conference we just reiterated what we said in our response which was within 21 days.

Senator XENOPHON: So you received the show cause notice on 23 March and you responded on 13 April. When did the show cause conference take place?

Mr Rix : 3 May, just after the holiday.

Senator XENOPHON: So subsequent to 13 April there was a show cause conference?

Mr Rix : There was, yes.

Senator XENOPHON: I understand you are circumscribed in what you can say at this stage while the matter is ongoing and maybe not as part of this inquiry because we need to report relatively soon, but is this something that you would be prepared to give further information on once the process has been completed?

Mr Rix : Yes, absolutely.

Senator XENOPHON: What is your understanding of the process being completed?

Mr Rix : We are effectively in the hands of CASA to respond to us. We are waiting to see what they have got to say about our responses.

Mr Davis : The enforcement manual does not prescribe a timetable for CASA to respond. Now that we have provided everything required in regards the evidence from our side, it is really now for CASA to decide.

Senator XENOPHON: I just want to ask one more question because I know Senator O'Brien has got further questions, as presumably do other colleagues. All of you have a background in aviation in the United Kingdom where the Civil Aviation Authority is the regulatory body the equivalent of CASA. What is your understanding and can you make an observation on the difference between the way the CAA deals with things and the way CASA deals with things? I do not mean it to be a critique; I just want to get an idea of a comparison of the two. What is your knowledge, for instance, of the FAA in the United States but obviously you would have a better understanding of the CAA?

Mr Berry : I think there is a fundamental difference between the structure and the organisation within the UK. Without going into too great a depth, the Civil Aviation Authority in the UK is also the investigative authority for issues of a more minor nature. So there is a single track reporting process, if you like.

Senator XENOPHON: Rather than the ATSB here?

Mr Berry : Yes, so we do not have a divide between the ATSB and CASA. Unless you get into more serious accidents and incidents which are investigated by the Air Accidents Investigation Branch, everything is contained within the regulatory authority. The authority is very strong on the elements that you have just described from the ICAO manual in terms of just reporting. They expect the operator to report but they are very strong, as I say, on the maintenance of the just reporting culture. They expect answers and they expect action when things have gone wrong but they do deal with the process within that just culture environment.

Mr Davis : I think the key difference is that under the UK system the show cause process does not exist as such. I think Senator O'Brien mentioned about the ongoing dialogue and so on. In the UK system you would not have received a show cause per se; you would have received a determination that says 'Having observed you and having done all our investigation and got all the detail we are now deciding to do this.'

Senator XENOPHON: Arguably the show cause notice here in Australia might be a fairer process because it allows for some dialogue and some natural justice components.

Mr Davis : Yes, but it may be that the bar in terms of the level of evidence that has to be presented is a bit lower because it is a consultation in terms of it being an investigation and you have the chance to go back then and say 'Actually this is what we think,' and it might be slightly different. I am not saying one is right and one is wrong; it is just a different approach. That is why when Senator O'Brien asked me about keeping the process confidential given it is still an investigation and it is still information gathering, I mentioned it is obviously important not to pre-judge that.

CHAIR: Just to clarify, Mr Davis, in the UK when you have the equivalent of the show cause notice, is it public knowledge?

Mr Davis : The determination would be public knowledge, yes.

CHAIR: The determination would be but the inquiry would not be?

Mr Davis : No, because auditing of airlines and continuous oversight is what regulators do. We are continuously audited and overseen by the safety regulator and that is appropriate. As you have seen in your inquiry airlines are always having issues. We are a human industry; there are a lot of people involved in our industry. Aviation safety has come to believe now that open and transparent reporting, people telling you where things have happened, is a way of seeing things ahead of time and taking corrective action that helps prevent things in the future. To pretend nothing happens and there are no issues is just not reality. There are always issues when you have got that many people involved in a process.

CHAIR: To the best of your knowledge, does any other country have a similar system that we have here in Australia where it is public knowledge?

Mr Davis : I am not aware.

CHAIR: As I say, to the best of your knowledge.

Senator XENOPHON: Just one quick question further to what you said, Mr Davis. Are you suggesting that the show cause notice in whole or in part arose out of material that was volunteered by Tiger to CASA?

Mr Davis : I would say substantially.

Mr Rix : Out of our reports that we give to CASA, yes.

Senator O'BRIEN: The other questions that I wanted to follow up go to your operations. Where are your aircraft based?

Mr Rix : We have six aircraft at Tullamarine, two at Avalon and two at Adelaide.

Senator O'BRIEN: It seems to me that your operation is what you might term a cherry pick operation in which you pick your routes, you pick your staff, your cost structure is determined by your model and you go where you can make that financially viable.

Mr Rix : Yes.

Senator O'BRIEN: So you go into places and if you do not think it works for you, you move out of places, subject to whatever costs you have got in establishing and moving away. I am told that your salary structure is sufficiently advantageous to attract pilots from other operations, is that true? In other words, you pay more than others? I am not asking for numbers.

Mr Davis : Competitive, I would say.

Mr Rix : I would say we are competitive.

Senator O'BRIEN: You are competitive, I think Mr Davis said?

Mr Rix : There are lots of reasons why a pilot or a staff member would choose to work for a company. Pure salary may be part of the package. It may well be that lifestyle is part of the package.

CHAIR: It is like a politician answering that one, Mr Rix.

Mr Rix : That is interesting. I have been called many things before.

Senator O'BRIEN: Yes, it might be a public relations answer. Presumably in your typical roster you have two shifts or it may be three shifts of pilots operating out of those places where you are flying say to the west and back, which I presume is your overnight operation?

Mr Berry : Yes, we would have an early shift, a late shift and possibly a night shift as well.

Senator O'BRIEN: So what sort of hour span is your pilot roster?

Mr Berry : In general terms, the operations start at seven o'clock in the morning so a pilot would report for work at six in the morning and that would take him through to the early part of the afternoon. The late shift would take on from there and go from the middle of the afternoon until around about nine or 10 o'clock in the evening. That really covers 95 per cent of our operation and then we have the back-of-the-clock flights. Currently we operate three of those across the network. Those operations take place at sort of nine o'clock in the evening through to four or five o'clock in the morning.

Senator O'BRIEN: Is it the same roster for your cabin crew?

Mr Berry : Yes.

Senator O'BRIEN: In terms of your cabin crew do you train your own or do they come with experience?

Mr Berry : We train our own.

CHAIR: How many hours a month?

Mr Berry : In terms of?

CHAIR: Pilots?

Mr Berry : Pilots? Well, it varies. We are limited to a thousand hours a year but actually last year we achieved 820 I think as the average. I think the average will be higher this year and we would like to be at around about 900 hours.

Senator XENOPHON: That is flying hours, though, isn't it?

Mr Berry : That is flying hours. That sits within the context of the EBA where we have agreed to provide additional time off to the pilots.

CHAIR: So per month what does that come out at?

Mr Berry : It is around about 75 hours a month.

Senator O'BRIEN: That is the average, is it?

Mr Berry : That is the average, yes.

Senator O'BRIEN: Yes, but you take leave out of that, so when they are flying it is longer?

Mr Berry : Yes. Inevitably, if pilots take leave, it will mean that some months are higher than others.

Senator O'BRIEN: Can we basically divide that number by 10 or 11 to get your average monthly hours?

Mr Berry : No, I think that the average would be around about 85 to 90 hours a month.

Senator O'BRIEN: What are the average hours for your cabin crew? They are on duty, but flying hours, is it comparable?

Mr Berry : The flying hours for the cabin crew are not monitored in the same way as pilots but we look at duty hours for our cabin crew. The duty hours for the cabin crew are about 130 hours a month.

Senator O'BRIEN: In terms of the issue of training pilots, there have been some suggestions that there ought to be a transfer fee arrangement if you want to take someone's pilot after they have trained, that you ought to pay something towards their training. I can imagine why you would resist that but could you tell me why that would not be equitable?

Mr Davis : That is interesting for the accountants. I guess the history of this is that generally the pilot's licence is considered personal in that this is a global industry and pilots inevitably pop up in many places around the world. Generally the history has evolved into one where pilots pay for quite a lot of their training themselves. Certainly in the early stages most of them pay for themselves to get up to an ATPL. It is our view that the licence is predominantly a personal asset which then moves around. I am just trying to think of an analogy.

Senator O'BRIEN: If a pilot has indeed paid for their own training that is a very fair proposition to put. Where a pilot has been trained by an organisation, are you suggesting that there perhaps should be an indenture or something between that organisation and the pilot?

Mr Davis : Most organisations would probably have some sort of salary reflection of the fact that they were providing the training for free, if you like. My experience has been that if the company is paying for that training and there is a significant cost, the salary structure for that person might be a bit lower than someone who has already completed the training and effectively therefore the employee is chipping in towards the cost. As a matter of practicality, I think it would be quite difficult to keep tracing back to the original provider of the training and saying somebody 10 years down the track needs to chip in some money to the company that spent some money on training some time ago.

Senator O'BRIEN: Sometimes training might be type experience as well which might not be paid for in a sense other than perhaps by the salary structure.

Mr Davis : As you are pointing out, there are a lot of different kinds of training. I think we all focus on the initial type rating but there is recurrent training, there is command training for those people who become captains, there is SEP and emergency training.

Senator O'BRIEN: Simulator experience.

Mr Davis : There is continuous training in various different types. I think the key issue is this initial licence that gives you the right to be a pilot. I am trying to think of an analogy whether you could even go back to universities and say that if someone became a doctor or a lawyer, is it appropriate that someone chips in for their schooling? It is a very specific licence that the person holds in their individual right.

Senator O'BRIEN: The reason I ask the question is that issues arise in my mind, and probably other members of the committee, about the ongoing need we will have to train pilots as those who reach retiring age retire or become medically unfit to fly in high capacity regular public transport aircraft. Some of the submissions we have had have been about the sort of role that government and organisations might have in that training. I am interested to see whether you have a view as to what your role could be if we were formulating such recommendations.

Mr Berry : There is a fundamental issue in terms of the infrastructure of the country in terms of the pilot workforce particularly in this country being key to the national infrastructure. I think that tinkering or the kind of methods that you are referring to in terms of transfer fees and what have you would be just simply incredibly difficult to manage, recognising that it is possible for one airline to decimate the operations of another by poaching. That is a hypothetical discussion for us because I do not think that we would be sensitive to that.

Senator O'BRIEN: It is intended to be hypothetical and nothing more than that.

Mr Berry : It does goes back to the heart of the discussion that we were having earlier on that if the kind of limits that are being suggested and proposed of 1,500 hours were to be imposed, then you do create an infrastructure headache. It is demonstrated in other parts of the world that pilots can successfully operate an aircraft with 200 or 300 hours and in other parts of the world and for other airlines that is the primary source of recruitment. Engaging in that process, understanding the process and understanding the precautions that have to be taken to make sure that that process is safe is the right track to secure the long-term future.

Senator O'BRIEN: If I am delving through that, you are saying that if you were required to have 1,500 hours, the value of pilots with that qualification would be much higher to operations and the loss of such a pilot would be a much greater loss?

Mr Berry : I think that is inevitable.

Mr Davis : I think we would consider ourselves to be a target. Certainly last year in Singapore we had a number of our pilots attracted to fly for Emirates or Etihad in the Middle East because they had done five or six years with us flying A320s which is a very nice aeroplane but as you know pilots, and I say this in front of a pilot, get fixated on the size of the aircraft and how many engines it has and everything else.

CHAIR: No difference in trucks.

Mr Davis : So we do end up being a target for the long-haul carriers who are obviously offering higher salaries and, from a pilot's perspective, a bit more excitement.

Mr Berry : The other point again refers back to a question earlier on that our pilots are required to come into the organisation with a type rating. That is something that they finance themselves but thereafter we exercise no hold over them at all. They are not indebted to the company in any sense; they are free to move on. As Tony was suggesting, we are a potential victim.

Senator O'BRIEN: You live by the sword and die by the sword in that regard?

Mr Berry : Yes.

CHAIR: Could I just make a matter of procedure? Is it your intention or would you like to give us any evidence in camera today?

Mr Davis : We are content with the evidence we have provided.

CHAIR: Okay.

Mr Davis : As Senator Xenophon mentioned, if you would like us to come back after the conclusion of the inquiry—

CHAIR: Before I go to Senator Nash, under the present training regime is it possible to get in the right-hand seat of an airline jet not ever having taxied the actual physical jet?

Mr Berry : No.

CHAIR: If you do not go into the second officer's seat, you go into the first officer's seat out of the simulator and in the simulator, as you know, you cannot see the end of the wing but you—

Mr Berry : I think I need to modify my answer. Within our airline the—

CHAIR: No, not your airline.

Mr Berry : I am not qualified to answer the question in relation to other airlines. I am not qualified to answer that.

CHAIR: To the best of your knowledge, in the aviation world is it possible to qualify as a first officer not ever having actually taxied the jet? In other words, to have done it all in a simulator and then find yourself in the right-hand seat saying, 'I didn't know the wing was that long, oops, I took the end off it'? That is possible, is it not?

Mr Berry : I simply do not know the answer.

Senator O'BRIEN: That is so hypothetical to be a question without an answer. Do you mean that in the real world does that happen? Is that your question?

CHAIR: Yes, are there licence approvals where you have actually not had—

Mr Rix : Physically flown the aircraft or taxied the aircraft even?

Mr Berry : I simply do not know the answer. In my experience, and I can only talk from my experience, we did not allow the first officer to taxi the aircraft, we did not even give him a steering wheel, which I always took great comfort from. On this aeroplane in Tiger they do get their own steering wheel.

CHAIR: Yes, Tiger is different.

Mr Berry : I simply do not have the knowledge to answer that question.

Mr Rix : In terms of through your career, you can answer it from that perspective. With experience that you have got, you have never actually had an experience of that, have you?

Mr Berry : No, I have not.

CHAIR: In other words in your experience you might have done 300 hours in the simulator and then somehow you do some hours in the actual plane but not in the right-hand seat?

Mr Berry : I think that question would relate to a long-haul operator who might use a second officer. Certainly all the training that we do—

CHAIR: As a qualified first officer in an airline, is it or is it not the case that when you are qualified as the first officer in the airline, sitting in the right-hand seat, you may not have ever actually physically taxied the plane because you have done all your training in a simulator?

Senator O'BRIEN: You know that that has happened in other words?

CHAIR: In other words, do they do some take off and landings for training in an airliner instead of the simulator?

Mr Berry : I think we are moving on to another question now. The training for a first officer is that he gains his licence, he gains his type rating on the aircraft, which is entirely conducted in the simulator, and then he goes through a process within the airline of line training. It depends what you call the point of qualification as the first officer. At the point of qualification of the first officer when he comes out of the simulator, he may be sitting in the right-hand seat of the aircraft having never flown the aircraft before.

CHAIR: That is all I need to know.

Senator NASH: How many countries does Tiger operate in?

Mr Davis : Twelve.

Senator NASH: They are?

Mr Davis : We have two different businesses. Tiger Airways Australia is exclusively domestic. Our international business out of Singapore flies to India, China, the Philippines, Thailand, Indonesia and Vietnam.

Senator NASH: When was that founded? When did it start?

Mr Davis : 2004.

Senator NASH: Being a new airline domestically in Australia, have you come up against I suppose what I would term perception issues as a new airline? Obviously in this country we have seen some airlines come and go. What sort of perception issues have you come up against, if any, and how have you dealt with it?

Mr Rix : It is quite interesting. The perception of this airline amongst the community particularly is that we have brought great competition to this country and we offer great fares. I talk to our customers on a regular basis and they said before it was nothing like this, we can go places more often, we can go and follow our footy team, we can go see our friends, we are great, we are great for the industry, we are great for them. From a consumer point of view I think it is a very positive message. We are a very well known carrier for many reasons, not least of all the program that aired a couple of years ago and is about to air again. We are very, very well known. There is a lot of interest in aviation and many things are exaggerated, as we well know, in terms of some of the press coverage that we get. The vast majority of our customers actually fly on time in Tiger Airways. The very vast majority of our customers have a great experience in Tiger Airways.

Mr Davis : In terms of setting up the business here there was some trepidation because of the history that you alluded to that most start-up airlines in Australia have failed. I think we have to be mindful that aviation in Australia has been a duopoly for many, many, many years, maybe too many years, and the infrastructure that exists is very much under the control of the dominant carrier Qantas. When we first started up the business there were airports that we wanted to fly to at which we were not able to get access to handling services. We even had to use some of the other airlines for security screening and things like that. I think it is fair to say that breaking the duopoly if you like is tough. I think we knew when we started the business it was going to be a difficult business to launch and that we would face a lot of stiff competition from the incumbent airlines.

We have persevered and we have built a business now that we think is sustainable and that we are confident can be successful. As Crawford said, we think it is in the consumer's interest to have competition in Australia. Senators would appreciate that if Tiger were to withdraw from the market it is obvious that airfares would go back and the airfare reductions that we have seen over the last few years would be eliminated. I have to be clear and say that with one airline controlling two thirds of the market, it is clearly tough to carve out enough market share and get enough patronage from consumers to make it successful. That is a tough job but that is what we are working on doing.

Senator NASH: I will go back to the fatigue issue. Mr Berry, you raised a very good point. How as an airline do you measure the measurement of fatigue from the roster system compared to externalities of pilots and cabin crew behaviour? How as an airline do you measure the difference and the impact of those things?

Mr Berry : That is the next stage, if you like, in the development of fatigue. Historically the view has been that we as the airline roster you in a fair way, you have an obligation as an individual to make the best use of the leisure time that we provide you to come to work and ensure that you are sufficiently rested. When I was referring to Senator Xenophon's question earlier on, traditionally the fatigue management models are only looking at the work side of your life. We would like to move ourselves to the state of the art position which is to be considering how your general lifestyle impacts in terms of fatigue. The three-year-old twins situation is something that other airlines look at, NASA consider it. There are those models and that research has been done in the market and so that is a place that we would like to move ourselves to.

Senator NASH: Yes and especially from the airline perspective that would seem quite sensible, would it not, because the external factors may well be the things that are causing the fatigue but the reflection may possibly be that it is the airline practice. Getting that right is obviously pivotal for the airline?

Mr Berry : A number of the reports that we have of fatigue say that it was not that the roster was too challenging, but somebody was rostered for a night flight, was simply not able to sleep for domestic reasons and was therefore not in a condition to operate the flight. We have those reports within our system, so it is a real issue and something with which we do deal.

Senator NASH: Thank you. Just finally, because I know we are due to break, how many pilots do you employ domestically in Australia?

Mr Berry : At this particular moment in time it is about 97 but the establishment is 103.

Senator NASH: Do you have a ballpark figure of retention rates? How many pilot movements have you had since 2007 of pilots leaving the airline? I am happy for you to take that on notice?

Mr Berry : I would take it on notice but I would comment that it is very few.

Mr Rix : Very few.

Senator NASH: Very few is good but if you take that on notice that would be great. Thanks.

CHAIR: One question and then one comment and we will knock off for 15 minutes. What is your experience of the drug and alcohol testing conducted by CASA?

Mr Rix : CASA has come to our business on a number of occasions, there is an open door, they come and they will do that. In my time, and I have been here a year next week, they have tested a number of times. I do not know if it would be appropriate to say what the outcomes were.

CHAIR: No, I am not suggesting—

Mr Rix : But they have tested.

CHAIR: It is just that for public safety we are aware there is testing. Finally the ultimate test for you blokes is do you still barrack for the Lions?

Mr Rix : I am sorry, say that again?

CHAIR: Do you still barrack for the Lions in the footy?

Mr Rix : I dare not say. It is a very dangerous in this country to say which my team is.

CHAIR: We have the Wallabies. You do not have to answer that. I thank you very much for your evidence today. We will be back in 15 minutes.

Proceedings suspended from 10:32 to 10:44