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Civil Aviation Safety Authority Reports 2004-05


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Annual Renort

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2004-05

Australian Government - Wt - j _ _____________________________

Civil Aviation SafetyAuthorit;

About this report

This report provides a concise picture of the Civil Aviation Safety Authority (CASA) and its performance in the year ended 30 June 2005, for the parliament, the aviation community and the public.

The report is presented for tabling in both Houses of Parliament of the Commonwealth of Australia. It complies with Part 1, Schedule 1 of the Commonwealth Authorities and Companies Act 1997 and the relevant Finance Minister's Orders. A compliance index is provided.

Structure

From the Chief Executive Officer points to significant developments in 2004-05 and to directions for the future.

Part 1 provides an overview of CASA itself, what happened during the year with operations and finances, and what is ahead in 2005-06.

Part 2 reports on what was achieved during the year, including the contribution made by CASA's four outputs to its vision of Safe skies for all and the portfolio outcome of Ά better transport system', performance against the measures set for the year, and important steps towards better outcomes in the future.

Part 3 reports on CASA's corporate governance, probity safeguards, and management of people, systems and stakeholder relationships.

Part 4 provides information about accountability and external scrutiny during the year from, and on behalf of, CASA's stakeholders.

Part 5 provides information in accordance with statutory reporting requirements not dealt with in other parts of the report, such as Freedom of Information, Occupational Health and Safety, Environmental Sustainability and the Commonwealth Disability Strategy.

Part 6 contains CASA's audited financial statements for 2004-05.

Part 7 provides appendices with statistical and other information supporting the operational and performance reporting in the body of the report.

Reader aids The following navigation tools are provided for readers:

• a contents page • a glossary

• an index of compliance with reporting requirements • a list of figures and tables • an alphabetical index

Australian Government

Civil Aviation Safety Authority

CASA Annual Report

Safe skies for all 2004-2005

Contents

Chief Executive Officer's Letter of Transmittal V

From the Chief Executive Officer vii

Part 1: Overview of Casa in 2004-05 1

CASA at a Glance CASA's Legislative Framework Major Work undertaken during 2004-05 Overview of Financial Performance Looking forward The year ahead

People Management Workplace Relations Revenue and Financial Plan Long Term Funding Strategy Cost Recovery Arrangements Managing Risk

Part 2: Operational Report____________________________ 21

Performance Framework Corporate Performance - At a Glance Corporate Performance - 2004-05

Part 3: Corporate Report______________________________59

Office of the Chief Executive Officer Senior Managers Governance Effective Management Probity

People Staffing Status Report for 2004-05 Stakeholder Relationships Systems and Processes

Part 4: Accountability and External Scrutiny 91

Accountability to the Minister Parliamentary Oversight Complaints and Investigations Review of CASA's regulatory decisions Freedom of Information Other review

Part 5: Statutory Reporting Requirements___________ 101

Statutory reporting of significant events Other major events Significant judicial decisions and administrative review decisions Freedom of Information Act

Ecologically sustainable development Commonwealth Disability Strategy Occupational Health and Safety Insurance and indemnities Competitive tendering and contracting Advertising and market research

CASA addresses

Part 6: Financial Statements_______________________ 121

Part 7: Appendices________________________________171

Committee Members Standards Development Standards Consultative Committee - Sub-committee activities Involvement in International Civil Aviation Organization (ICAO)

activities Operating Statistics Staffing Consultants, contractors and legal expenses

Glossary_________________________________________203

Indices

Compliance Index List of figures and tables Alphabetical Index

205 207 209

© Civil Aviation Safety Authority 2005 ISBN 0-9751470-5-6 ISSN 1327-5968

This work is copyright. Apart from any use as permitted under the Copyright Act 1968, no part may be reproduced by any process without prior written permission from CASA. Requests and inquiries concerning reproduction and rights should be directed to

General Manager, Corporate Relations, GPO Box 2005 Canberra ACT 2601 Australia

Australian G overnm ent

Civil Aviation Safety Authority

OFFICE OF THE CHIEF EXECUTIVE OFFICER

Trim Ref: EX05/30304

14 October 2005

The Hon Warren Truss MR Minister for Transport and Regional Services Parliament House CANBERRA ACT 2600

Dear Minister

On behalf of the Civil Aviation Safety Authority (CASA), I present to you the Annual Report for the reporting year 1 July 2004 to 30 June 2005.

The report has been prepared in accordance with the Commonwealth Authorities and Companies Act 7997and the associated Orders made under the Act, and in accordance with the Civil Aviation Act 1988. The report includes a report of operations, financial statements and the Auditor-General's Report on those financial statements, as required under the

Commonwealth Authorities and Companies Act 1997.

In accordance with section 9 of the Commonwealth Authorities and Companies Act 1997, I certify that I am responsible for the preparation and content of the report in accordance with the Finance Minister's Orders.

I also certify that I am satisfied that CASA has in place appropriate fraud control mechanisms that meet the Authority's needs and comply with the guidelines applying to this financial year.

Yours sincerely

Bruce Byron AM

Director of Aviation Safety and Chief Executive Officer

C A S A A n n u a l R e p o r t 2 0 0 4 - 2 0 0 5 V

From the Chief Executive Officer

At the end of 2004-05 CASA is well placed to take the regulation of Australian air safety to a new level of maturity. In prospect is a CASA that makes an even greater contribution to air safety, works more effectively with the aviation industry

and continues to build public confidence in air travel. My goal is for a CASA that uses its resources more efficiently, and puts them where they will make the most significant impact in achieving improved safety. Importantly, I also want to see an aviation industry that is confident in its acceptance of the responsibility it has

for delivering safety each and every day, on each and every flight, as part of the responsibility it shares with CASA for aviation safety.

I am sure that in hindsight the past year will be seen as highly significant for CASA. Public surveys tell us the Australian community believes CASA is doing a good job and has the public's confidence that safety in the skies is being

maintained at high levels. While this is very positive it is, however, not a basis for standing still. That is why during the past year I have been discussing with people in CASA and the aviation industry about how we can improve the regulation of aviation safety and how we can best meet public expectations. The outcome has been a plan for change and new and better ways of doing our job.

Even though CASA is at an early stage of the reform process, much was achieved during 2004-05. A key initiative was the development of an industry sector priority policy for CASA. In simple terms, this sets out CASA's high-level regulatory priorities. The policy is based on a common sense approach. However, it is critical because for the first time we have clearly set out how we will approach the task of regulating safety, which is by putting the safety of passengers first.

This priority policy now guides the way CASA will allocate its people and other resources. Naturally, it does not mean CASA is withdrawing from the lower priority areas of aviation, but it does mean we will look for less resource intensive ways to contribute to safety in those sectors. Our aim will be to give the proper level of support for the sectors lower on the priority list to help them to take greater responsibility themselves for maintaining safety, with education and training an obvious starting point. Where people in the aviation industry put the optimal effort into safety and take safety seriously, CASA can contribute as a safety mentor and partner. But if safety corners are cut or the rules deliberately broken, CASA will be ready to take strong and decisive action.

To focus our minds on the need and direction for change, I established a reform program, "Building a new CASA", emphasising that change is happening and improvement is required. But I did stress to staff that creating a new CASA does not mean that everything in the past was being jettisoned. We are, in fact, using the hard work that has gone before as the foundation for building a new CASA, which will meet the safety regulatory needs of the aviation industry in the 21st

Century.

The 'new CASA’ program has four goals for our organisation. CASA must:

® Make a real and lasting contribution to aviation safety

<§> Be efficient and cost effective

® Have good relations with those in the industry who are focussed on safety

® Be accountable to parliament, the government and the travelling public.

C A S A A n n u a l R e p o r t 2 0 0 4 - 2 VII

These goals, and the industry sector priority policy, has become a benchmark for all the activities CASA undertakes, from surveillance to regulatory services. We have begun the process of examining what we do and how we do it against these reform principles. If any activity is low on the industry priority policy and does not make a real contribution to safety, then the obvious question is why is CASA putting resources into this activity. At the same time, we are asking whether the activities required to maintain and improve

safety are being undertaken in the most effective way. We are looking for better ways of working, and for using our resources as efficiently as we can.

Our relationship with industry is very important because the regulator alone cannot deliver safety. We want to work in a partnership with everyone in the aviation industry who takes safety seriously and who puts the right resources into safety. CASA will offer support and guidance to those people who make safety their highest priority, just as we will take action against people who ignore their safety responsibilities.

I place great store on accountability as it is a key element in ensuring we are performing as we should. The Australian public and its parliamentary representatives rely on CASA and its people to be their aviation safety guardians. In turn, it is our responsibility to openly report on what we are achieving.

During the next 12 months, the building a new CASA program will promote change right across the organisation, with operational and support areas all under scrutiny and subject to reform. I fully expect to see some activities cease, others altered substantially and many people working in different ways. We will look at everything from the location of our offices to the responsibilities given to our management and staff. There will be changes in the way we undertake surveillance, with more resources allocated to front­ line activities, spending more 'time on the tarmac' with aviation industry operators, and more checking of operations. This will mean less reliance on formal audits as the sole means of surveillance, with more intelligence gathering and a greater focus on working with aviation industry people to solve safety problems. A substantial number of change projects have been initiated.

One of the key initial reform steps in the reform process has been the development and implementation of a new structure for CASA. We have created six core groups within the organisation that better meet the needs of the aviation industry and improve our focus on core safety issues. The new Air Transport Operations Group is responsible for operations of larger aircraft, with the General Aviation Operations Group for aircraft in the smaller categories. There is now a Manufacturing, Certification and New Technologies office, a Personnel Licensing and Training Group, and a Legal Services Group. The final group is Information Services, bringing together CASA's information technology and knowledge management functions. This structure has been designed to ensure CASA people are working in more effective teams, focussed on defined and improved safety outcomes.

One consequence of the new structure is the integration of regulatory standards development with the rest of CASA's operations. In the past, people working on writing new aviation safety standards or reviewing existing regulations were grouped together and away from the people carrying out surveillance or other frontline activities. This risked the creation of 'silos', with the possibility that rules could be developed

without full regard to their day-to-day operation. As the Regulatory Reform Programme continues, the new arrangements will support the development of better rules that

deliver better safety outcomes.

Already there have been changes to the way the Programme is being run. I have made it clear that new rules must address known or likely safety risks and must make a real contribution to safety. Rules for the sake of rules is not an acceptable outcome of reform. It is also extremely important for the new regulatory regime to be easy to understand and work within. Complex rules without good reason are

not acceptable. This means new rules need to focus on the safety outcomes we are seeking to achieve and must be developed within a simple two-tier framework of the Civil Aviation Act and Civil Aviation Safety Regulations. CASA will continue to work to introduce new rules in a measured way, minimising the demands on

industry as far as possible.

I am very pleased that during the last year CASA has been able to place additional focus on the flying training industry. A range of initiatives are under way to improve the quality of flying training, work that will pay safety dividends in the future. I recognise that for some time there has been concern that not enough was being done to support the flying training industry. A special group was set up - the Flying Training Industry Development Panel - to change this situation. The Panel is made up of people from CASA and the flying training industry and is looking at key issues such as professional development for flight instructors and the publication of a new flight instructor's manual. The reaction of the aviation industry to this work has been very positive and CASA will continue to strongly support flying training improvements.

The focus on change and reform in CASA over the last year has placed additional demands on many of our people. Reviews bring uncertainty and change can be unsettling.

In the past year I have visited all of CASA's offices around Australia to speak with staff about the new directions. From talking to people right across CASA it is clear there is a good understanding of why we need to change and what we are striving to achieve.

Our staff, and their commitment to the reform goals, are essential to the developmentof a highly professional organisation that is ready to face the challenges of the future. The positive attitude of CASA’s people points to a sound future for CASA and promises even better air safety for Australians.

I thank our management and staff for the contribution they made in the past year, and for what 1 expect they will contribute to the new CASA as the reform program moves forward.

Bruce Byron AM

Chief Executive Officer

C A S A A n n u a l R e p o r t 2 0 0 4 - 2 0 0 5 ix

Part 1

Overview of

CASA in 2004-2005

CASA Annual Report 2004-2005

Overview of CASA in 2004-05

CASA at a glance

This section outlines some key information about CASA and its role.

The challenge

To lead the aviation community in providing Australia with a world-class air safety environment, which has public trust and confidence.

Our vision

'Safe skies for all' Our values

® a shared commitment to CASA's vision of 'Safe skies for all'

® continual examination of ways to improve everything CASA does

® dedication to timely, quality service internally and externally

® integrity and professionalism

® respect and courtesy

® fairness and consistency

® teamwork

Our decisions will be

® consistent

® predictable

® fair

® transparent

® independent

® based on good judgement

We will demonstrate our willingness to

® be flexible and responsive

® communicate and listen

® consult widely

® be open to ideas from the local and international aviation communities

® maintain a high level of visibility to industry

What CASA is

CASA is an independent statutory authority within the Transport and Regional Services portfolio. It was established in 1995, under the Civil Aviation Act 1988, to regulate aviation safety in Australia and the safety of Australian aircraft overseas. There were 704 CASA staff located in 13 offices around Australia at the end of June 2005. Operating revenue for 2004-05 was 122.8 million.

What CASA does

CASA's role is to maintain, enhance and promote civil aviation safety by:

® setting aviation standards

® certifying aircraft, maintenance organisations and operators

® licensing pilots and engineers

® registering examiners

® carrying out safety surveillance

® enforcing safety standards

® promoting industry awareness and understanding of aviation safety standards and safety issues

® encouraging greater industry acceptance of its obligations to maintain high standards of aviation safety

® monitoring the safety performance of the aviation industry and identifying safety-related trends and risk factors

® assessing international safety developments

® consulting and communicating with all interested parties on aviation safety issues

® managing and administering the requirement that operators hold carriers' liability insurance

® cooperating, upon invitation, with the Australian Transport Safety Bureau in investigating aircraft accidents and incidents

® promoting the development of Australia's civil aviation safety capabilities, skills and services for the benefit of the Australian community and for export.

Who CASA does it for

CASA's stakeholders include:

® 20 million Australians

® 49.2 million domestic and international airline travellers

® participants in 1.7 million general aviation flying hours

® the holders of 12 401 aircraft registrations on the Australian register

® 883 Air Operator's Certificate holders

® 731 maintenance organisations

C A S A A n n u a l R e p o r t 2 0 0 4 - 2

Overview of CASA in 2004-05

® 256 aerodrome operators

® 1 provider of air traffic services, aeronautical telecommunications, and air traffic services training

® 3 providers of aerodrome rescue and fire fighting services

® 32 696 pilots and other flight crew

® 6 274 licensed aircraft maintenance engineers

® 15 000 members of sports aviation organisations.

Where CASA is located

Figure 1: Location of CASA offices

Moorabbin

¥

CASA Field Offices

A list of addresses for CASA offices is provided on page 117-119

How to contact CASA

GPO Box 2005

Canberra ACT 2601 Australia

CASA Building

Cnr Northbourne Ave and Barry Drive

Canberra ACT 2600 Australia

National number: (local call cost): (+ 61 from outside Australia) 131 757

Confidential Hotline: (+ 61 from outside Australia) 02 6217 1010 or 1800 074 737

Facsimile: (+ 61 from outside Australia) 02 6217 1209

Email: feedback@casa.gov.au

Website: http://www.casa.gov.au

CASA’s legislative framework

Enabling legislation and functions

CASA was established on 6 July 1995 as an independent statutory authority by an amendment to the Civil Aviation Act 1988.

Under section 9 of the Act, CASA has the primary function of conducting the safety regulation of:

® civil air operations in Australian territory

® the operation of Australian registered aircraft outside Australian territory.

Section 9A of the Act requires CASA to regard the safety of air navigation as the most important consideration in the exercise of its powers and the performance of its functions.

The Civil Aviation Regulations 1988 and the Civil Aviation Safety Regulations 1998, developed under the Civil Aviation Act 1988, provide for general regulatory controls over air navigation safety. The Act and the Regulations allow CASA to issue Civil Aviation Orders on detailed matters of regulation.

CASA is progressively bringing the 1988 Regulations and the Civil Aviation Orders into the 1998 Regulations under its Regulatory Reform Programme.

CASA is also responsible for administering the requirement that operators hold insurance pursuant to the Civil Aviation (Carriers' Liability) Act 1959.

Other legislation

Other legislation affecting CASA's exercise of powers and performance of functions includes the:

® Air Navigation Act 1920

® Commonwealth Authorities and Companies Act 1997

® Auditor-General Act 1997

® Criminal Code Act 1995

® Ombudsman Act 1976

® Freedom of Information Act 1982

® Privacy Act 1988

® Administrative Appeals Tribunal Act 1975

® Administrative Decisions (Judicial Review) Act 1977.

Major work

Major projects on CASA's desk during the year included:

® the Regulatory Reform Programme and its implementation

® the National Airspace System

® ongoing implementation and review of the new enforcement provisions

Overview of CASA in 2004-05

® the introduction of photographic pilot licences accompanied by background checking

® planning for the commencement of the Office of Airspace Management

® the Australian Air Traffic Management Strategic Plan

® introduction of cost recovery in line with Government policy

® planning for the introduction of the Canberra Licensing and Registration Centre

® increased engagement and involvement with members of the aviation industry

® planning towards 'Building a New CASA

® reviewing and confirming CASA's industry sector priorities; and

® the finalisation of the CASA Improvement Programme and the delivery of the Aviation Industry Regulatory System (AIRS).

A number of these projects had a high public profile and all involved a significant cross- CASA and/or cross-agency effort.

Finances

Overview of Financial Performance

The following analysis is based on audited Financial Statements for 2003-04 and 2004-05 and Budgeted Financial Statements for 2004-05 contained in 2004-05 Budget Related Paper No.1.15.

Audit Result Original Budget Compared to

Comparison 2004-05 Audit Result

110.9 122.8 11.9 114.7 122.8

106.8 110.2 (3.4) 114.7 110.2

4.0 12.5 8.5 0.0 12.5

‘/Vote that the table may not add exactly due to rounding.

The net operating result for 2004-05 was a $12,5m surplus which was an improvement on the break even 2004-05 Budget. The improvement was largely due to increased revenues ($8.1m) generated by increases in aviation fuel excise ($3.9m), miscellaneous

revenue ($2.3m) and interest received ($1.3m), combined with decreased total expenditure of $4.5m largely attributable to savings in supplier expenses ($3.6m).

The operating surplus for 2004-05 was $8.5m higher than the 2003-2004 result, mainly due to increased appropriations and other revenues ($12m) offset by increases in expenditure ($3.4m). These movements are discussed further below.

Figure 2 Financial Performance Trends

135,000 -,-

ο o o te

115,000

95.000

75.000

55.000

35.000

15.000

-5,000

2003-04 2004-05 2004-05 2005-06 2006-07 2007-08

Audit Result Original Audit Result Budget Forward Forward

Budget Estimate Estimate Estimate

Total Revenue Total Expenses —· — Net Operating Result

Figure 2 shows that in 2005-06 CASA is initially expecting a decrease in revenue as a result of reduced government appropriations. From 2006-07 onward revenue is expected to increase due to the phasing in of the cost recovery programme. Expenditure is expected to rise slightly due to increased compliance activities.

Total Revenue

Figure 3 shows that for the financial year ended 30 June 2005, CASA received 53% of its total revenue from aviation fuel excise and 40% from Government appropriations. The remainder is derived from regulatory service fees, interest, and other sundry revenue.

Figure 3 Components of Revenue 2004-05

O ther 2%

Aviation fuel excise 53%

G overnm ent Appropriations 40%

Total revenue for 2004-05 was $122.8m, which was $8.1 m higher than the original budget of $114.7m.

C A S A A n n u a l R e p o r t 2 0 0 4 - 2 0 0 5

Overview of CASA in 2004-05

This increase is largely the result of the following:

® aviation fuel excise ($3.9m) reflecting increased fuel usage;

® insurance recoveries ($2.3m) due to unbudgeted insurance recoveries; and

® interest received ($1,3m) due to increased cash balances.

Total revenue for 2004-05 was $11,9m (or 11 %) higher than the 2003-04 result, due to increases in the following:

® government appropriations ($3.4m) reflecting additional government funding;

® aviation fuel excise ($4.1 m) due to increased fuel usage;

® increased other revenue ($2.5m) reflecting insurance recoveries ($2.3m); and

® regulatory service fees ($1,7m) due to the commencement of the cost recovery programme.

Total Expenditure

Figure 4 shows that for the financial year ended 30 June 2005, CASA spent 63% of its total expenditure on employee costs and 32% on suppliers. The remainder largely comprises depreciation and amortisation expenditure.

Figure 4 Components of Expenditure 2004-05

Total expenditure for 2004-05 of $110.2m was $4.5m (or 4%) lower than the 2004-05 original budget of $114.7m, largely due to underspends in projects, as a result of timing slippages.

Total expenditure for 2004-05 of $110.2m was $3.4m (or 3%) higher than the 2003-04 result. This is largely attributable to increased employees expenditure of $2.2m due to increases in employer superannuation contribution rates for the CSS, PSS and AvSuper

superannuation schemes.

Overview of Financial Position

Key indicators of the health of CASA's financial position are its ability to sustain its asset base, the ability to pay debts falling due in the short term, and maintaining prudent levels of longer term liabilities. The ability of CASA to sustain its asset base is indicated

by changes in its net assets.

Figure 5 Financial Position Trends

70.000

60.000

50.000

g 40'000 p M 30,000

20.000

10,000

2003-04 2004-05

Audit Original

Result Budget

2004-05 2005-06

YTD Actual Budget Estimate

2006-07 2007-08

Forward Forward

Estimate Estimate

Total Assets Total Liabilities Net Assets

Figure 5 shows that at 30 June 2005 CASA's net asset position is strong as a result of increased cash balances following an operating surplus ($12.5m) and a revaluation of assets. From 2005-06 CASA's net asset position is expected to remain strong. However, it is expected to decrease initially, as cash balances are reduced to fund the

Long-Term Funding Strategy. From 2006-07 onwards the net asset position is expected to increase due to the phasing in of the cost recovery programme.

Looking Forward

Ongoing change for the aviation industry

Industry outlook and implications for CASA

The industry outlook over the next year is for continuing change and pressure from many sources, for all sectors of the aviation industry.

There will be ongoing rationalisation and restructuring of the industry in terms of operators, size of operation, types of aircraft used and routes flown. The period ahead will also see implementation of considerable regulatory reform, though this

will be staged as far as possible to minimise any impact. Competitive pressures and international changes will also prompt adoption of new technologies. CASA will need to continue to deal with the current increased interest from potential new entrants in the Air Transport sector.

Economic pressures resulting from fluctuations in fuel prices and demand, and from currency movements affecting the costs of aircraft and maintenance, will continue to be significant. Industry will also face higher fees and charges for various aspects of aviation activity. These effects on industry will be reflected in the competing calls on CASA's regulatory resources. For example, the changes and pressures outlined above signal potentially increased risks we must evaluate and upon which we may need to act through safety education, targeted surveillance or both. Whilst demand for regulatory

C A S A A n n u a l R e p o r t 2 0 0 4 - 2 9

Overview of CASA in 2004-05

services is likely to remain high, it could be expected to be moderated by increased cost recovery changes. There is likely to be increased stakeholder pressure for CASA to improve the timeliness and cost of services.

The Year ahead:

In planning for the year ahead, CASA has made a number of assumptions about internal and external environment.

The key assumptions include:

® Competitive pressures in the industry will continue. While the number of participants within the industry as a whole will remain relatively constant, the turnover of individual organisations within each segment will remain high with a commensurate resource impost for CASA.

® General Aviation activity is expected to remain flat with continued growth in sports and recreational activity.

® CASA will continue to work towards completing the Regulatory Reform Programme and will work closely with industry to achieve a smooth and effective transition to the new rules.

® There will be no government policy changes that will significantly affect the way CASA operates.

® No judicial decisions will adversely affect the way CASA performs its functions.

With these assumptions in mind, CASA is planning to deliver the following during 2005-2006:

Building a New CASA

The term 'Building a New CASA’ is not just an expression - it's a summation of the package of reforms and changes that will be made across the organisation. This reform will continue over the coming years, and is intended to see change implemented in a measured and thoughtful way that delivers real improvements for CASA people, the organisation, the aviation industry and the travelling public.

In November 2004, CASA initiated a new set of priorities that explicitly placed passenger-carrying operations ahead of all other aviation operations. This priority policy will determine how CASA allocates its people and its resources, and was the first step in a reform aimed at ensuring CASA:

® makes a real and lasting contribution to aviation safety

® is efficient and cost effective

® has good relations with industry where CASA is seen as a valued partner in aviation safety

® is accountable to parliament, the government and the travelling public.

CASA now gives clear priority to the aviation operations that carry passengers, from high capacity regular public transport down to charter and other operations. Naturally CASA will not neglect other sectors of the industry, but will ensure people and resources are aligned with the new priorities.

(D

Another important element of refocusing CASA's work will be development of ways to measure the effectiveness of frontline activities such as surveillance, enforcement and education. By creating effectiveness measures, CASA will be able to make better decisions on which activities should be given priority and how resources can best be allocated.

Clear surveillance directions

CASA has issued a hierarchy of surveillance tools prioritised to match the different passenger-carrying industry sectors. As a consequence, the surveillance approach taken with high capacity regular public transport will vary from that taken with charter operations or passenger-carrying aerial work. These new directions will also guide future surveillance planning and allocation of resources to surveillance.

Other initiatives include developing a wider range of surveillance tools and new information technology to capture compliance data relevant to CASA's new priorities. This will enable CASA inspectors to take a more targeted approach to aviation operators.

The surveillance tool kit includes entry control, topic-targeted audits, operator risk based audits, scheduled audits, guidance and advice and operational visits.

New guidance for development of standards

To support the package of reforms, a review of the Regulatory Reform Programme will be undertaken in 2005-2006 to ensure delivery of quality new Civil Aviation Safety Regulations that are simple to follow and reflect world's best practice.

The review, in conjunction with the Standards Consultative Committee, will give a fresh focus to the new Civil Aviation Safety Regulations to ensure the regulations are:

® developed on the basis of addressing known or likely safety risks with each proposed regulation to be assessed against the contribution it will make to aviation safety

® drafted to specify the safety outcome required, unless, in the interests of safety, and to address known or likely aviation safety risks, detailed requirements need to be presented

® developed within a two-tier regulatory framework comprising the Civil Aviation Act and the Civil Aviation Safety Regulations, and supported by advisory material that details acceptable means of compliance with the CASRs.

To further support the review, Regulatory Advisory Panels are being established to provide advice on the proposed content of each CASR Part and, where applicable, the associated Manual of Standards. Members of the Advisory Panels include a mix of CASA and aviation industry representatives. The focus of this process will

be on making sure the regulations are not 'just done', but are 'done right'.

Of the 57 CASR Parts being developed under the Programme, approximately half have come into effect and the others are currently being reviewed in line with the

new directions.

Overview of CASA in 2004-05

CASA is committed to ensuring the safe and smooth transition of both the aviation industry and CASA itself to the new CASRs and other regulatory amendments as they arise. Considerable attention will be given to implementing the new Civil Aviation Safety Regulations in partnership with industry participants and to providing flexible transitional arrangements wherever possible.

A new structure

Another stage in the process of 'Building a New CASA' was release of a new high-level organisational structure which was implemented on 1 July 2005. While only a part of the larger reform process, this new structure aligns CASA more closely with the way the aviation industry operates.

The new operational structure sees aviation activity organised between four new groups:

® Air Transport Operations

® General Aviation Operations

<§> Personnel Licensing, Education and Training

<§> Manufacturing, Certification and New Technologies.

There are also two supporting areas - Information Services and Legal Services. Standards development and regulatory reform implementation is allocated to the appropriate operational group. This structure mirrors the sectors within the aviation industry, with the intention of making it easier for industry to work with CASA and for CASA to deliver the best safety outcomes.

Creation of the Information Services Group recognises the importance of finding better ways to manage and share information and knowledge. Changes have also been made to Human Resources, Finance and Risk and Audit.

The next stages of reform will focus on ensuring all CASA activities contribute to improving and maintaining aviation safety. Activities that do not meet this goal may be shed, while resources or people not being used to improve or maintain safety will be reallocated to ensure they are able to make a positive contribution.

Figure 6 - CASA’s new organisational structure

C A S A A n n u a l R e p o r t 2 0 0 4 - 2 0 0 5

Overview of CASA in 2004-05

Change implementation team

A change implementation team was formed within the Office of the Chief Executive Officer in February 2005 to assist with the practical aspects of implementing reform.

The team has been tasked with helping managers and staff drive and manage the 'Building a New CASA’ reforms, including development of specific tasks and projects that must be completed to align CASA operations with the new priority policy. The team also coordinates work to implement the new organisational structure and complete the development of a sustainability strategy for CASA.

During 2005-06, the team will continue to liaise with CASA people, industry and stakeholders to look at the ways CASA's core business and service delivery contribute to aviation safety and how these can be managed in the most efficient and cost- effective ways.

In planning, implementing these initiatives, CASA will be seeking to define its performance against four criteria:

© Safety effectiveness with a focus on passengers

© Efficiency

© Industry relations

© Accountability.

Improved safety in flying training

Following analysis conducted within the Office of the Chief Executive Officer in early 2004 of General Aviation fatal accidents for the past decade, CASA identified the need to provide increased support for the flying training industry, particularly as a means of reducing the incidence of uncontrolled flight into terrain.

To address this need, CASA has formed a team of flying training specialist inspectors and created the Flying Training Industry Development Programme. In conjunction with the specialist inspectors, this programme will help the flying training industry identify issues adversely affecting flying training standards, and develop initiatives and

programmes to address these issues.

CASA expects the following safety benefits will be achieved:

© Training for and standardisation of Flying Operations Inspectors and Authorised Testing Officers will ensure appropriate pilot entry standards are understood and applied in a

consistent manner on a national basis.

© Industry will gain an enhanced understanding of the broader issues surrounding flying training standards and will demonstrate a greater acceptance of their responsibilities to maintain high standards in flying training.

© By adopting a cooperative and collaborative approach, flying training industry participants will be encouraged to share concerns and issues with CASA and offer partnership-based solutions in a constructive manner.

© Advice from the industry, combined with implementation of targeted programmes on a partnership basis, will deliver an enhanced overall safety climate in the flying

training sector.

The Flying Training Role Specialists group was formed following announcements from CEO Bruce Byron that CASA is looking to improve our contribution to the flying training sector, and in the future will work closely with the Flying Training Industry Development Panel.

The CASA Deputy Chief Executive Officer and Chief Operating Officer, Mr Bruce Gemmeli, has reported that the formation of the team and its role is a good example of a changed approach designed to achieve better aviation safety outcomes.

" CASA now has a clearly defined focus on passenger-carrying operations, with flying training a high priority. We can't expect safety at the top levels unless we ensure pilots are being trained and assessed properly right from the start."

CASA’S flying training role specialists with industry instructors

Both students and experienced pilots rely on the quality of the training they receive to develop the skills and knowledge that keep them and their passengers safe, and making real improvements in this area is the group's major focus.

With specialists to be engaged in significant face-to-face contact with all subparts of the flying training industry, the training was designed to enable members to present a consistent, up to date and technically competent face to industry to

ensure maximum credibility.

Flying training specialist group member Leonard Yates reported that the purpose of the week in Maitland was to standardise the group, ensure their flying skills were current and up to speed and look at how instructors should be trained and assessed.

"To do this we flew specific sequences in a Cessna 172, with specialists taking turns role-playing instructors and students.

"The ground component of the training involved looking at stalling and circuits in flying training assessment.

"We also received refresher training in emergency manoeuvre recovery on a Pitts Special aircraft, including inverted spins and other scenarios an authorised testing officer or flying instructor might find themselves in.

"For the group it was refresher training, making sure we are all current and confident in handling these situations.

"The outcome from the training was a united view about where we should be going in terms of projecting requirements for authorised testing officers and chief flying instructors.

"We worked solidly throughout the week finishing up around 10.30 each night with our laptops around the dinner table. I think I can speak for all of the group when I say that the training was invaluable and it gave us a terrific opportunity to bond as a team."

C A S A A n n u a l R e p o r t 2 0 0 4 - 2 0 0 5

Overview of CASA in 2004-05

People management

CASA's approach to people management will emphasise the importance of appropriate values and behaviours in the workplace in achieving the right outcomes for the industry, as well as making CASA an efficient, effective and high-performing organisation.

Key areas of focus for people management activity will include:

® ongoing development of the CASA values and supporting behavioural framework, to provide further guidance to managers and staff

® development of management frameworks and capabilities to ensure an alignment between management performance and achievement of organisational goals

® further development of the CASA performance management arrangements, which will provide a mechanism for regular discussion of individual work programmes aligned to CASA's business outcomes; an important facet of the enhancement to CASA's performance management arrangements is the greater emphasis that will be placed on the values and behaviours exhibited by CASA staff in successfully achieving work programmes that support CASA's goals

® development of learning programmes focusing on the foundation skills needed for CASA staff to carry out their technical, regulatory and corporate responsibilities.

® revision of human resource and occupational health and safety policies, procedures and practices, to place greater emphasis on organisational flexibility, greater responsiveness to CASA's business requirements and increased line manager responsibility for people management as well as ensuring employees have a safe and healthy place in which to

work.

Supporting initiatives in people management will include:

® improvement in the service delivery capability for people management in CASA, with a focus on timeliness and clarity of advice on staffing matters

® development of improved capability in the CASA human resources team to ensure better and more timely human resources outcomes for the organisation, staff and the industry

® continued implementation of systems and processes which improve delivery of human resources services across CASA.

Supporting CASA people to meet new priorities and to do an even better job is one of the central goals of the reform package announced by CEO Bruce Byron. Mr Byron has specified that additional training for staff is one important step in this area.

Bruce Byron meets with staff from the Aviation Safety Promotion branch

Mr Byron has indicated that "Naturally, the cost of training has to be taken into careful consideration, but I believe this is an investment we need to examine closely."

"I have also identified a number of other initiatives that can be developed in the coming months to provide practical assistance to our front line people."

One initiative is using external auditors to pass on knowledge and skills to CASA's inspectors.

From July 2005, external auditors working with CASA will be asked to set aside some time to accompany flying operations and airworthiness inspectors on aviation audits, particularly those involving large organisations.

The experience of these professional auditors can then be passed on in a practical way to CASA staff.

"I know many of our inspectors would like formal training in auditing, but this is going to take some time to filter through to everyone. This is another way to do the same thing, with a focus on the real issues we need to address in aviation audits and surveillance."

Workplace relations

At the time of reporting, CASA was negotiating a new Certified Agreement with its staff. The Agreement is being developed to provide ongoing support for the strategic direction that has been set for CASA and publicly announced in the 2005-06 to 2006-07 CASA Corporate Plan.

CASA's key goals for the Certified Agreement are organisational flexibility, improved responsiveness to our obligations under the Civil Aviation Act, and better aviation safety outcomes, whilst providing for an effective and rewarding work environment.

C A S A A n n u a l R e p o r t 2 0 0 4 - 2 0 0 5

Overview of CASA in 2004-05

Revenue and financial plan

CASA's total forecast revenue for 2005-06 is $117.1 million to be derived from the following sources:

® $40.5 million from government appropriations

® $65.9 million provided by the aviation industry through collection of excise revenue on aviation fuel used in domestic travel

® $10.6 million collected for regulatory services specifically requested by the aviation industry.

This revenue base is intended to broadly reflect the beneficiaries of CASA's functions, undertaken as part of its responsibilities under the Civil Aviation Act 1988.

The financial plan for 2005-06 and the forward estimates for 2006-09 reflect the figures provided in CASA's Agency Budget Statement 2005-06. (See page 125)

Long-term funding strategy

It is essential that CASA have a rigorous strategy in place that will ensure greater certainty in its underlying financial position. CASA's Long-Term Funding Strategy (LTFS) is underpinned by efficient and effective fiscal management and by an increase in cost consciousness by all in the Authority.

CASA's total appropriation and other revenue in 2005-06 has decreased by $2.0 million from the estimated actual for 2004-05. This decrease is largely attributable to implementation of the LTFS. The LTFS will achieve a number of significant outcomes, namely:

S> self-sustainability of CASA by 2009 with funding being linked to industry activity

® no additional cost to government

® an efficient and effective organisation focused on delivering core value adding services to the industry and government

® a phased reduction in the level of fuel excise

a more equitable cost recovery and funding framework that ensures all organisations benefiting from CASA's activities contribute in some way to its funding

®> industry stimulus will be achieved by increasing the number of activities delegated to industry, thereby enabling qualified industry participants to partner with CASA to ensure safety.

Cost recovery arrangements

The Australian Government adopted a formal cost recovery policy in 2002 that focuses on the direction government agencies should take to improve the consistency, transparency and accountability of Australian Government cost recovery arrangements, and promote the efficient allocation of resources.

CASA's changes to cost recovery arrangements will commence from 1 January 2006. CASA's functions under the Civil Aviation Act 1988 include the provision of regulatory services to the aviation industry and CASA currently has some limited cost recovery arrangements in place for these regulatory services. Twelve different services are

specified under the Civil Aviation (Fees) Regulations 1995 and fees are charged at either a fixed rate for particular services, or at an hourly rate based on the number of hours taken to provide the service. These services are charged across a range of segments in the aviation industry, but predominantly to licence and certificate holders.

The LTFS includes a significant consultation and communications programme for industry. To ensure adequate time is dedicated to the consultation process, the cost recovery implementation programme will be phased in over three years.

Commitment to managing risk

As an aviation safety regulator CASA must understand the nature and full dimension of the risks it oversees. CASA is therefore systematically identifying and analysing a wide range of issues and risks in order to make informed decisions that contribute to Safe Skies for AIL

Risks are inherent in all aviation activity. As a regulator, CASA also faces a wide variety of risks. These risks can be associated with failing to detect breaches of safety standards, incorrect and inconsistent application of regulatory standards, failure to properly carry out statutory responsibilities; or they can arise from introducing new and advanced technologies, or from natural events. Managing risk, in conjunction with other CASA management directions, is integral to achieving CASAs performance goals.

Commitment to best practice risk management and developing a climate for a risk- aware culture extends from the highest levels to line managers and employees throughout the organisation. To understand the environment in which CASA operates and develop the operating assumptions that underpin CASA's future direction, CASA's strategic risk profile is regularly reviewed and updated.

As Australia's aviation regulator, CASA will always face decisions of where best to apply its resources to achieve the most effective industry oversight and to ensure public accountability for the resources it uses. For this reason, CASA continues to carry out risk-based surveillance to give priority to those sectors, operations and operators that pose the greatest risk.

National Airspace System

CASA will continue to play a key role in the safety oversight of the changes to Australian airspace as they are progressively introduced.

CASA will need to make further amendments to standards (e.g. CAO 92.3), the Aeronautical Information Publication, Civil Aviation Advisory Publications (CAAPs) and possibly regulations (CAR 166, CASR 71) to support National Airspace System

changes.

CASA will continue to assist with education and training, and with stakeholder liaison on National Airspace System issues as appropriate.

Part 2

Operational report

CASA Annual Report 2004-2005 21

Operational report

2004-05 continued to be a year of solid achievement for CASA, in which it consolidated important work begun in previous years, planned for the future and continued the series of reforms commenced by the Chief Executive Officer.

Against this background, uncertain times continued for all involved in the aviation industry, with each sector facing considerable economic and competitive pressures.

These pressures and the availability of new technologies both prompted and provided the opportunity for change. There was ongoing rationalisation and restructuring of the industry in terms of operators, size of operation, types of aircraft used and routes flown. For CASA, this environment was reflected in continuing high demand for regulatory services, the need for new standards, and potentially increased safety risks that required extra vigilance.

This part of the report presents CASA's progress towards its vision of 'Safe Skies for ΑΙΓ against the effectiveness indicators and performance measures contained in the Portfolio Budget Statements.

As well as setting out what was achieved in 2004-05, the report outlines important steps CASA took during the year for better outcomes in the future.

Performance framework

The performance framework within which CASA operates is shown in Figure 7 on the following page.

Corporate planning process

The strategies and initiatives CASA pursued in 2004-05 were developed in the rolling three-year corporate planning process.

This process focuses on the factors that CASA believes will be critical to success in:

<§> meeting the challenge of leading the aviation community in providing Australia with a world class air safety environment, which has public trust and confidence

® achieving the vision of 'Safe Skies for All'; and

# making an effective contribution to the portfolio outcome of Ά better transport system for Australia'.

The four outputs shown in Figure 7 are closely interrelated in how well CASA achieves its vision and in the contribution CASA makes to the portfolio outcome. This interrelationship is reflected in the effectiveness indicators shown on the chart, each of which draws on the achievement of objectives across the outputs. Achievement of CASA's Corporate Plan for 2004-05 to 2005-06 was monitored during the year by way of quarterly performance reports, reviewed internally.

The Minister, to whom the plan was submitted in June 2005, received a performance report with CASA's submission of its new corporate plan for 2005-06 to 2006-07.

Figure 7 - Performance Framework

CASA's

Strategic Goals

■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■

Portfolio Outcome

A better transport system for Australia

CASA's core Outputs

I t o S p p I '

i l l l i a

Aviation Safety Standards

Aviation Safety Compliance

Aviation Safety Promotion

Aviation Regulatory Services

Improved Aviation safety performance

High level of public confidence in aviation safety

A world class regulator

A high performance organisation

Strategic Objectives

Performance Targets Strategies/Initiatives

. V .

As part of the October 2003 corporate governance changes, CASA's corporate plans are now formally subject to the Minister's approval under section 44 of the Civil Aviation Act. CASA submitted a corporate plan to the Minister at the end of June 2005.

Output cost attribution

CASA has a fully integrated budget and costing framework, which has been in place for several years. This cost attribution model has been consistently applied to obtain the cost of outputs. The general methodology of determining direct costs and controllable expenses to outputs is based on the daily capture of staff time against approved business activities, which aggregate to CASA's four outputs. Accordingly, the direct costs of business activities are known and each business activity linked to an individual CASA output. Overhead costs are attributed to CASA's outputs based on the direct staff-hours being consumed in the delivery of CASA's four outputs.

Corporate Performance Report - At a glance

® While the total accident rate increased from 7.9 in 2003 to 8.2 in 2004, the best summary of data suggests General Aviation accidents per 100 000 hours flown has on average steadily declined at a rate of 4.8 per cent per year over the past decade;

® The number of fatal accidents per 100 000 hours flown in the General Aviation sector is estimated to have declined at a rate of 6.2 per cent per year over the last decade;

® Ninety-four per cent of planned compliance audits in General Aviation and ninety-seven per cent of planned audits in Airline Operations have been achieved;

® Risk-based audits have been fully introduced to the Airline sector, and there is some progress to be made in introducing risk-based audits in the General Aviation;

® Determination of the risk-based hierarchy of CASA's safety priorities reinforced that CASA is established primarily to look after the interests of the travelling public. Resources will be allocated broadly inline with an industry sector's position in the hierarchy of priorities;

® CASA staff and Sub-Committees of the Standard Consultative Committee have been reviewing all draft CASH Part regulatory packages to apply the requirements of CEO Directives 16 and 17, The timeframe for completion of the RRP will be finalised pending those reviews;

® Industry is becoming increasingly involved in the development of CASA's standards through public consultation and representation on the Standard Consultative Committee;

® CASA expects an increase in the number of exemptions and amendments to CASRs in the short-term, with a reducing trend over the long-term;

® Transition of industry to CASR Parts 11, 47, 139 and 173 is in progress and the responsibility for completing the transition is now with the respective groups under the new structure;

® CASA exceeded the target in on-time issue of AOCs and COAs issued within agreed timeframes. Ninety six per cent of AOCs and ninety-one per cent of COAs were issued on-time;

® Ninety per cent of industry service recipients indicated satisfaction with the regulatory sevices provided by the CASA Sevice Centre;

® The Aviation Industry Regulatory System is on track to be implemented in September 2005;

® CASA established the Flight Instructor Development Program. Training courses were conducted for ten CASA flying training role specialists and six industry Approved Testing Officers.

Eighty-eight per cent of course participants in safety education programs reported their knowledge on the subject matter improved; 0

® CASA estimates that it improved educational and training coverage of industry by more than five per cent by distributing 'Briefings in a Box' to flying training organisations, by conducting 'Safety Evening Programs’ in country locations, and by conducting various education programs and distributing education materials throughout the year;

® No CASA decisions were overturned by the Administrative Appeals Tribunal in 2004-05;

® A significant uptake of the new enforcement tools was evident from the number of infringement notices issued and Enforceable Voluntary Undertakings entered into during the year;

® The Revised Performance Communication Scheme is currently being developed as part of the new Certified Agreement. This is expected to have continued emphasis on CASA values and behaviours;

® The Long Term Funding Strategy was approved by the Expenditure Review Committee. CASA expenditure is limited to funding levels and two thirds of CASA's funds (fuel excise and fees for services) are linked to industry activity;

® CASA collected ninety-eight per cent of planned $5m revenue from regulatory services during the financial year;

® During the year, nine hundred and forty media stories involving CASA were monitored. It was revealed that ninety two per cent of media stories were neutral in their treatment of CASA, with four per cent negative and four per cent positive. This is consistent with previous years;

® There has been a low number of genuine complaints received by CASA;

® A good cooperative working relationship exists between CASA, DOTARS and Airservices Australia in relation to Australia's participation in the International Civil Aviation Organization (ICAO);

® Australia was re-elected to Group One of the Council of ICAO at the 35th Assembly in late 2004 as a 'State of Chief Importance in Air Transport'. CASA made a significant contribution towards maintaining Australia's position in ICAO;

® CASA made good progress towards establishment of an effective working relationship with the European Aviation Safety Agency;

® CASA has been very responsive to the new aviation security regulations; and

® CASA showed a marked improvement in performance reporting by winning the Gold Award from the Institute of Public Administration (ACT Division) for its 2003-04 Annual Report and a Bronze Award from the Australasian Annual Reporting Award for the same reporting period.

C A S A A n n u a l R e p o r t 2 0 0 4 - 2

Operational report

GOAL: IMPROVED AVIATION SAFETY PERFORMANCE

Effectiveness in 2004-05

Performance targets

Reducing trend in number of accidents per hours flown by industry sector While the total accident rate increased from 7.9 in 2003 to 8.2 in 2004, the best summary of data suggests General Aviation accidents per

100 000 hours flown is estimated to have steadily declined at a rate of 4.8 per cent per year over the past decade (see Figure 8).

Figure 8- General Aviation accidents per 100 000 hours flown, 1995 to 2004

Reducing trend in number of fatal accidents per hours flown by industry sector

< o

8"

7, 1995 1 996 1 997 1 998 1 999 200 0 200 1 2002 2003 2004

Y ear

Source: Department of Transport and Regional Services

(Bureau of Transport and Regional Economics)

Notes: Data for 2004 is preliminary

Excludes accidents in Sports Aviation and Regular Public Transport

The number of fatal accidents per 100 000 hours flown in the General Aviation sector is estimated to have declined annually by 6.2 per cent over the last decade (see Figure 9).

Figure 9 - General Aviation fatal accidents per 100 000 hours flown, 1995 to 2004 2-

1 -

.9 ­

.8 ­

. 7 -

1995 199 6 1997 199 8 199 9 2 0 0 0 2001 2 0 0 2 2 0 0 3 200 4

Y e a r

Source: Department of Transport and Regional Services (Bureau o f Transport and Regional Economics)

Notes: Data for 2004 is preliminary

Excludes accidents in Sports Aviation and Regular Public Transport

■

Objective

Simple to use, clear and concise aviation standards and rules based on known risk factors

Strategies/Initiatives

Review and maintain national aviation safety standards and practices based on known risk factors:

• develop and review regulations

S i

1 »

■

Ill

Progress report

Following the issue of CEO Directives 16 (Development of Regulations and the Regulatory Framework) and 17 (Establishment of Regulatory Advisory Panels), CASA and the Standards Counsultative Committee (SCC) Sub-Committees have been reviewing all draft CASR Part regulatory packages to apply the requirements of the Directives. To meet the objectives of the Directives, more detailed instructions were issued by the Chief Operating Officer to both CASA staff and the SCC. A trial assessment on new methodology was conducted using the maintenance suite of CASRs. This trial illustrated that there were still some differing views on concepts of risk assessment and outcome-based regulation. As a consequence, CASA conducted an information session for CASA and key industry personnel on these topics so that within CASA and the industry there would be a more unified view of these issues.

Considerable progress has been made with the application of CEO Directive 16 to the flight crew licensing suite of regulations (Parts 61, 141, 142) and to CASR Part 91 (General Operating and Flight Rules). CASA and the SCC Sub-Committees have commenced the review of CASR Part 146 (Engineering Representatives) and Part

121 (Air transport operations - large aeroplanes). The review of Subpart 21 .H (Airworthiness Requirements for Light Sport Aircraft) has been completed and a report has been submitted to the SCC for consideration and subsequent CASA advice.

In relation to CEO Directive 17, the Terms of Reference have been accepted for the Regulatory Advisory Panels.

As required, CASA is amending existing standards to ensure their functionality. As the Regulatory Reform Program (RRP) continues to be delayed, there is an increasing need to consider other regulatory amendments outside the RRP. As such, a number of

recommendations from the Australian Transport Safety Bureau (ATSB), Coroners and Parliamentary inquiries need to be reviewed.

C A S A A n n u a l R e p o r t 2 0 0 4 - 2 0 0 5 27

Operational report

Objective Simple to use, clear and concise aviation standards and rules based on known risk factors (continued)

Strategies/Initiatives Progress report

d current timeframe for During the reporting period, progress on the Regulatory Reform letion of Regulatory Reform Programme (RRP) remained slow.

• extend

compl Program to improve quality of standards M t i * f ΐ

· - ' - .'Sw "· ·' ' ■ · ·* . . ·

Following the issue of CEO Directives 16 and 17, revised regulatory development planning is under way to progress the RRP. Wmm | M I P S ft '

m ·

• define the new timetable for completion of Regulatory Reform Program

A revised timetable will be completed by September 2005.

continue to improve regulatory Post implementation reviews under way include Parts 65 (Air clarity and conciseness through Post traffic services licensing), 67 (Medical), 92 (Consignment and Implementation Review (PIR) of carriage of dangerous goods by air), 101 (Unmanned aircraft and regulatory packages

IH g |f 1 ' \ /·. *

g g g ·

. · ffl

m ¥ s m m m

«ÎÎ¯ ‘

■Mi

rocket operations), 143 (Air traffic service training providers), 171 (Aeronautical telecommunications service and radionavigation service providers), 172 (Air traffic service providers) and 173 (Instrument flight

Part during the year.

procedures design). Significant progress was made in respect of each

| Î’ ΐ ί Ι Î’ :4 * K · : r l ■ ■ 7 :

·'··'-■.-Λίίν.···.->.1 . . · ·· . .!■.·· ·»

The Post Implementation Review of CASR Part 171 (Aeronautical Telecommunication Service and Radionavigation Service Providers) was concluded with the publication of an Notice of Proposed Rule Making in December 2004 proposing relatively minor changes to the regulations, Manual of Standards and Advisory Circulars.

Simple to use, clear and concise aviation standards and rules based on known risk factors (continued)

Objective

On-track Delayed Completed

Reducing trend in average number of exemptions to CASRs over 10-year period

One of the key intentions of the Regulatory Reform Programme is the development of simple, unambiguous and generally harmonized regulations. It is expected that the aviation industry's need for exemptions will therefore be reduced considerably.

The revised exemption provisions of proposed CASR Part 11 reflect the philosophy that exemptions and directions should be of limited

solutions are developed.

CASA expects there may be an increase in the number of exemptions as the new regulations are finalised and possible shortcomings in the regulations are identified. Exemptions may be required

pending amendments being made to the CASRs. However, after the transition to the new regulations is finalised, CASA anticipates a decrease in the number of exemptions.

However, following the issue of CEO Directives 16/2004 and 17/2004, and pending finalisation of plans for the Regulatory Advisory Panels and the impact of the new CASA organisational structure, timeframes in that draft will be revisited with a view to completing the revised plan by September 2005.

duration to allow safety issues to be addressed while longer-term

On-track Delayed Completed

CASA expects a similar trend as is anticipated for the number of exemptions (above).

Reducing trend in average number of amendments to CASRs

On-track Delayed Completed

By September 200* timetable to complet Reform Program

A revised CASA Plan (incorporating Regulatory Reform Programme and Regulatory Reform Programme Implementation) was developed and submitted to the CEO for consideration.

Operational report

Objective

Identify and address the most significant safety related trends and risk factors in the system of civil aviation safety in Australia

Significantly enhance CASAs safety research and analysis capability A new safety research capability that directly reports to the COO was introduced on 1 July 2005 as part of the ‘Building a New CASA’

series of reforms.

Introduce mechanisms for translating the results of research and analysis into action within CASA and/or the aviation industry

Strategic Research Adviser continues to produce statistical and analytical reports on various aspects of CASA and industry activities.

On-track Delayed Achieved

Annual identification of safety risks by industry sector and their sources Identification of risk-based hierarchy of CASAs safety priorities is the basis for the new policy where CASA formally acknowledges it has

been established primarily to look after the interests of the travelling public.

'

CASAs resources will be allocated broadly with the industry sector’s position in the hierarchy of priorities.

Objective

Address risk of uncontrolled flight into terrain in the General Aviation sector

Conduct targeted safety education campaigns:

• establish an education team to directly help training organisations improve the quality of flying training

During the reporting period, CASA established the Flight Instructor Development Program in conjunction with identified industry specialists and specific training courses were conducted for ten CASA flying training role specialists and six industry Approved Testing Officers.

In addition to this activity, a risk management education program was developed and implemented for operators of ex-military aircraft.

• develop joint industry-CASA training regimes and materials

A rotary wing instructors conference was held and work commenced on developing a helicopter Flying Instructor Handbook

• develop new Instructor Manual with industry input by December 2006 The Flying instructor Handbook was revised and distributed to 1700 instructors with a request for input by October 2005 to assist the next

revision phase.

On-track Delayed Completed Not Due

Reduction in the percentage of fatal accidents involving uncontroiied flight into terrain

Results will not be apparent in reduced accident numbers for at least two years given the relatively low number of events and the time required to develop and implement the initiatives of the Flight ι Λ ί Α ΐ · n c i U Q l n n m n n f n o n o l

Instructor Development panel.

Objective

Improve effectiveness of CASA’s surveillance program in contributing to better safety outcomes

Implement risk-based surveillance auditing targeting specific safety risks identified from a whole-of-industry perspective

General Aviation (GA)

Functional Surveillance, Safety Trend Indicator (STI) and assessment of the Airline Risk Tool for some sectors of GA are all programs responding to CEO Directive 12. Progress is as follows:

•

W S " :

The STI database has now been developed. This database allows flexibility for questions to be modified.

- ~ - wmm b m © s m

Management of the new General Aviation Operations Group will also be considering the application of the Airline Risk Tool to some sectors of GA.

. ; : : : '

The Functional Surveillance consultation phase and trial is completed. Feedback has been compiled from the consultative process.

.

Discussion and transitionary arrangements are being undertaken with GAOG on factors relating to Directive 12.

, e / m, ^ 11 imzj m m${ Airline Operations

e

Under CEO Directive 5, the Compliance Airline Office (now the Air Transport Operations Group) was to ensure that each airline organisation, including relevant maintenance organisations, were subject to one risk-based audit where the audited topic was determined from a ‘whole-of-industry’ perspective.

· The audit topics for 2004-05 were Maintenance Control (for Air Operator Certificates) and Control of Documents (for Certificate of Approvals). The related audit elements are:

- - AOCs: System of Maintenance. Airworthiness Directive

Management and Reliability Program.

' IS " · COAs: Manual currency, content consistent across manuals and distribution

· Consistency and standardisation was to be achieved by utilising a 'control group’ of inspectors for each topic, where at least one member of the control group is utilised on each audit. Eight Control Group Inspectors were selected.

C A S A A n n u a l R e p o r t 2 0 0 4 - 2

Improve effectiveness of CASA’s surveillance program in contributing to better safety outcomes (continued)

O b je c tiv e

Strateg ies/l n itiati ves Progress report

/; Currently, analysis is based on Electronic Safety Incident Reports, i: Aviation Safety Incident Reports, Service Difficulty Reports and ‘ auditing data; The results will:

1 ' ' '

pressures

· A new Desktop Risk Tool was trialled. Further development is : dependent on a review of air transport AOC & COA surveillance

produce reasonably accurate trend information

list those operators under the most relative and perceived

and entry control processes.

Ή Version 1.3 incorporating 9 amendments was released as planned in r April 2005. llillki;

m m m i m

Performance targets

On-track Delayed Achieved

By June 2005, introduce risk-based audits to airline sector with relevant audit topics : ·' . .

On-track Delayed Completed

By June 2005, introduce risk-based audits to General Aviation sector

Objective

Use CASA safety education programs to promote industry’s responsibility for aviation safety

Focus on flying training introduced to support the foundations of aviation safety. Efforts focused on raising professional standards of instructors and testing officers.

Education programs are being determined and significant issues identified by accident and incident database analysis.

Provide support to Aviation Safety Foundation of Australia to develop generic pilot proficiency programs for delivery by flying schools.

Safety Management System awareness program continued through participation in professional conferences and distribution of information pack.

Objective

Improve effectiveness of CASA’s surveillance program in contributing to better safety outcomes (continued)

Strategies/Initiatives

• by December 2005, all course j participants routinely Surveyed to determine effectiveness of the course

Progress report

Participants routinely surveyed. Eighty-eight per cent of course participants in safety education programs reported their knowledge and understanding of the subject matter improved.

Quizzes conducted show eighty six per cent scored more than eighty five per cent correct answers in post seminar assessment.

■ ■ SSSSS^SSS

■

Provide tools and guidance to internal and/or external groups lo deliver educational material

Briefing in a Box concept introduced to widen delivery of CASA educational material. This concept will enable instructors to understand the background and deliver educational briefings on specific topics with minimal preparation effort. First pack on

Operations In and Around Controlled Airspace delivered.

Technical training and/or education for CASA staff and industry on the regulatory framework

Provide sponsorship and support for industry to introduce safety education programs

Performance targets

CASA increases the number of industry participants attending safety education and promotion courses by 5 per cent per annum

80 per cent of course participants rate the courses as effective and have improved their understanding of their safety responsibilities

Program generally on hold due to the review of the Regulatory Reform Programme. Support provided for industry education on current regulatory issues. ggggj Approximately $200,000 provided to a range of organisations engaged in delivering aviation safety related programs

On-track Delayed Achieved

CASA believe that this measure was achieved by following initiatives:

• Briefing in a Box packs distributed to 215 flying schools.

• The Safety Evening programs generated more than 200 attendees.

• Total attendance at education programs was 2 562.

• 22,000 CD/DVDs distributed covering operations around controlled airspace.

• 800 AOC holders received 3 sets of runway incursion posters

• 6000 education material addressing aircraft wiring issues were distributed to engineers.

On-track Delayed Achieved

Eighty-eight percent of course participants in safety education programs reported their knowledge and understanding of the subject matter improved.

C A S A A n n u a l R e p o r t 2 0 0 4 - 2

Operational report

GOAL: HIGH LEVEL OF PUBLIC CO NFIDENCE IN AVIATIO N S A FTE Y

Objective

Inform the public of the health of aviation safety in Australia

Convey results of safety research and analysis to stakeholders '

Research and analysis of general aviation fatal accidents was published on CASA’s web site in April. Media coverage was also generated.

Provide timely and accurate information to aviation industry, general public and media

A total of nine hundred and forty media stories involving CASA were monitored during the year. Approximately a third (33 per cent) were in print media, sixty per cent radio and seven per cent TV.

Ninety two per cent of stories were neutral in their treatment of CASA, with four per cent negative and four per cent positive. This is consistent with previous years.

Thirty nine media releases were issued during the year.

Conduct annual survey of general public Annual survey developed. Procurement has been completed and survey planned to occur in the September quarter 2005-06.

Develop strategies to improve CASAs crisis management response:

• regular review and updated list of key risks to CASA’s public profile

• develop responses to manage CASA's public profile ; ^

Risks are reviewed monthly, with strategies developed to manage their occurrence. The key risks are reported to the Chief Executive Officer.

Responses to issues are reviewed and updated monthly and reported to the Chief Executive Officer.

On-track Delayed Completed Not Due

Public confidence in aviation safety as measured in the annual survey

GOAL: A W O R LD CLASS REG ULATO R

Objective

Embed the values and behavioural outcomes of the Minister’s Charter Letter in CASA’s personal and corporate performance frameworks

Strategies/Initiatives Progress report

Continue inclusion of values in the CASA The inclusion of the CASA values is maintained, both in the current Performance Communication Scheme Performance Communication Scheme and in the revision to the scheme currently being negotiated as a part of the new CASA Certified Agreement.

' ' ' 6

Enhance existing learning and Continues to be emphasised in CASA Team Leadership Program and development programs in CASA’s revised Code of Conduct.

Revise recruitment and selection policies Completed. Reference to CASA values and behaviours incorporated and practices into all selection criteria, and Human Resource Representative training

also includes emphasis on the CASA values.

Conduct industry survey of CASA’s values and behaviours

Performance targets

Annual assessment of values and behaviours with the personal performance appraisal

By June 2005, industry view of CASA’s values and behaviours

By June 2007, reducing trend of industry complaints about CASA’s behaviours and consistency of regulatory decision making

To be completed in 2005-2006.

On-track Delayed Completed

Process under consideration as a part of the review of the existing Performance Communication Scheme and also in the context of the development the Certified Agreement.

On-track Delayed Completed

On-track Delayed Completed Not Due

Operational report

Objective

Improve transparency and consistency of regulatory decisions

Strateg ies/l nitiati ves Progress report

. · · ·- ..

Develop a t ί Ηη η κ ΜΙ·· f compliance

Performance targets

Five new rulings were issued during 2004/05,

The new rulings cover:

• training and checking requirements, including the number of checks per ‘calendar year' s§ l|is P ii|lig n l8 s £ g S s s j i

• classification of aerial work operations involving passengers

• the carriage of infants and children in excess of flight manual ... limitations ,

• serviceability of instruments and equipment for charter and regular public transport operations

• approval to manufacture components in the course of maintenance. IsyitiBlllglS W ^e § M § m m M

A prototype has been developed but no further work undertaken. It has been identified that the progression of this issue will require significant financial and resource allocation if to proceed.

E

On-track

By June 2006, develop a toolbox for delegates

Delayed Completed Not Due

Objective

Improve complaints handling

Implement a comprehensive and publicly transparent complaints-handfing mechanism

Completed. The CASA Service Charter has been reviewed and re-issued. To ensure transparency of the complaints management process, management and reporting of complaints and compliments is now undertaken at an senior management level and reported on a monthly basis to the Chief Executive Officer.

Monitor and analyse complaints and representations received : Corporate Affairs prepares a monthly report on complaints and representations and reports this to the CEO. Issues are identified

based on complaints received and strategies and business improvements implemented to rectify any identified issues.

On-track Delayed Completed

By December 2005, reduction in the annual number of complaints received about CASA

Initial analysis of the complaints received by CASA since the commencement of the Complaints and Compliments management processes have indicated a low level of ‘true’ complaints regarding CASA systems and processes.

.

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Proactive steps taken from analysing matters referred to CASA through the processes outlined in the Complaints and Compliments framework aims to reduce the annual number of complaints received about CASA.

Objective

Make decisions based on risk assessment

Expand and improve CASA’s rtsk management framework The desktop risk tool trialled in the Sydney Airline office. Trial results have been assessed and recommendations were made.

• develop risk models and tools for implementing risk-based industry surveillance audits

Work has commenced on a quantitative General Aviation risk model. Deliverables include risk based schedule tool and risk based resource allocation tool.

. " .

Risk methodology developed and delivered to assist with CEO Directive 16 and the Regulatory Reform Program.

C A S A A n n u a l R e p o r t 2 0 0 4 - 2 0 0 5

Operational report

Objective

Make decisions based on risk assessment (continued)

• contribute to a risk-based surveillance program for General Aviation and Airline Operations

Risk training provided as part of the deployment of the Airline risk model

Scheduling and resource allocation tools provided as part of the risk tool trial

General Aviation user requirement and new data inputs scoped.

On-track Delayed Achieved

By 30 June 2005, risk-based surveillance implemented

Objective

Improved enforcement regime

Effective implementation of enforcement reform:

• develop training programs to implement and administer new enforcement tools with consistency and fairness

New enforcement tools are being used with no specific training undertaken as training was completed immediately after the new changes were introduced.

A formal review was undertaken of the new enforcement tools and completed in May 2005.

A review report was presented to the Chief Executive Officer and a number of changes to the new tools have been recommended.

These recommended changes will be referred to the Department of Transport and Regional Services for consideration as they will require amendments to the Civil Aviation Act.

• use of infringement notices to trigger the demerit points scheme for appropriate breaches

Infringement notices are being used in accordance with new enforcement tools.

During the 2004/05 financial year, 79 infringement notices were issued. On the rare occasion that the fines associated with the notices were not paid, the matters were referred to the Director of Public Prosecution for prosecution.

In all cases so referred, the courts found the person guilty and imposed fines significantly higher than the original administrative fine.

Develop Compliance Management instruction pending incorporation into Enforcement Manual

It was determined that the Enforcement Manual will be directly updated by Office of Legal Counsel (now LSG) in iieu of a temporary Compliance Management Instruction.

Improved enforcement regime (continued)

O b j e c t i v e

Performance targets

On-track Delayed Achieved

Maintain a low number of enforcement During the 2004/05 financial year no CASA decisions were decisions overturned by the overturned by the Administrative Appeals Tribunal. Administrative Appeals Tribunal In relation to a serious and imminent risk suspension decision taken

by CASA, the Federal Court overturned CASA's decision. But no reasons have yet been provided for the Court’s decision and CASA cannot make a judgement on what concerns the Court may have had.

On-track Delayed Achieved

By June 2005, measure usage by From the number of infringement notices issued and Enforceable CASA inspectorate of new enforcement Voluntary Undertakings accepted during the year it is evident there tools has been a significant uptake of the new enforcement tools.

It is important to note that, to date, there has been no criticism from industry of CASA’s use of infringement notices and demerit points.

On-track Delayed Not applicable

By August 2004, develop Compliance Management Instruction

Objective

Ensure the safe and smooth transition of industry and CASA to the new CASRs and other regulatory amendments

Comprehensive task and resource planning and scheduling The closure of Regulatory Reform Program Implementation (RRPI) and the handover of outstanding tasks/activities to the respective

groups under the new structure was completed on 30 June 2005.

Ensure staff and industry readiness through information and education Regulatory Reform Program Implementation (RRPI) completed a number of readiness programs for both industry and staff.

Most notable were:

• A program of twenty two briefings for industry personnel addressing the requirements of Quality Management Systems and Manufacture in the Course of Maintenance (MITCOM).

• Delivery of a Flying Operations Competency Based Training (CBT) training program for industry and staff across the country. The program addressed the requirements under the existing legislative framework and will assist in preparing industry for transition to the new rules.

C A S A A n n u a l R e p o r t 2 0 0 4 - 2 0 0 5

» » > 3 9

Objective

Ensure the safe and smooth transition o f industry and CASA to the new CASRs and other regulatory amendments (continued)

Strategies/Initiatives

Timely transition of industry to new regulations according to their business needs

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Progress report

• Part 47 - Aircraft Registration Transition - thirty per cent complete

1623 certificates have been issued to date. Responsibility for ongoing transition to Part 47 was handed over to the Personnel Licensing, Education and Training Group on 30 June 2005.

• Part 11 - Regulatory Administrative Procedures - fifty per cent complete

Briefings for CASA staff have commenced with sessions being conducted in Adelaide, Cairns and Townsville. The remainder of the briefings will be carried out in 2005-06.

• Part 139 - Aerodromes - forty five per cent complete Case management of all Part 139 aerodrome operators continues and the project is on track - ninety six aerodromes have been registered and fourteen have received certification.

With respect to the requirements of Part 139 relating to ‘Approved persons for safety inspections’ - fifteen approvals have been issued to date.

• Part 173 - Instrument Flight Procedure Design fifty per cent completed A first certification under this Part has occurred. Qantas has sought an Authorisation to provide services for their international operations. Airservices Australia's application for Certification is proceeding.

Individual case management of transition of organisations through the Regulatory Reform Program Implementation

Conduct Post Implementation Review on transition

Performance targets

Transition started on or before effective date of each Civil Aviation Safety Regulation

Industry transition completed by the end of each relevant Civil Aviation Safety Regulation transition period

• Case management of Part 139 aerodrome operators continues, particularly at aerodromes with limited resources. Case management includes assistance in preparing the transition to the aerodrome manual and safety management manual.

• Post Implementation Review planned but not yet commenced for Parts 21, 60 and 92.

On-track Delayed Completed

• Part 47, 11, 139 and 173 commenced on time

On-track Delayed Completed

All parts ongoing and have been transferred to the respective groups within the new structure

Maintain Australia’s international aviation safety reputation

Objective

Work cooperatively with the Department of Transport and Regional Services and Airservices Australia in accordance with the tripartite memorandum of understanding on Australia's participation in the International Civil Aviation Organization (ICAO)

A productive and cooperative working relationship exists between CASA, the Department of Transport and Regional Services and Airservices Australia in relation to Australia’s participation in ICAO.

Quarterly meetings of senior officials of the three agencies are held to review current high-level issues and provide direction to the Australian Representative on the Council of ICAO.

Support ICAO through active participation CASA has actively supported ICAO with an appropriate level of Panel and Working Group participation at both global and regional levels.

The requirement to maintain this level of support, as defined in the Minister’s Charter Letter, has been met. Additional effort has been expended in initial planning for the Director’s General of Civil Aviation, Asia Pacific Conference.

Maintain effective interaction with overseas regulatory authorities Regular liaison is maintained with overseas regulatory authorities across a wide range of issues, including direct interaction and

through conferences and meetings. This has been continued effectively with the Federal Aviation Administration, the United Kingdom Civil Aviation Authority, the Luftfahrt-Bundesamt (LBA), the Civil Aviation Authority of China and the New Zealand Civil Aviation Authority. Due to resource constraints a lesser degree of interaction

has been undertaken with the Centro Technico Aerospacial (CTA) of Brazil, Singapore Civil Aviation Authority and Japan Civil Aviation Bureau. Other Authorities have been contacted on an as-required basis. -

Establish an effective working relationship with the European Aviation Safety Agency (EASA)

Establishment of this relationship commenced with a visit to EASA resulting in an EASA review of CASA aircraft certification systems in Australia. Subsequent visits to EASA for an international conference, including at Chief Executive Officer level, have established an effective working relationship.

Maintain Australia's status as an International Civil Aviation Organisation (ICAO) Member State of Chief Importance in Air Transport

On-track Delayed Completed

Australia was re-elected to Group 1 of the Council of ICAO at the 35th Assembly in September/October 2004 as a ‘State of Chief Importance in Air Transport’. The strong support for Australia can be attributed to, Australia’s strong commitment to active participation in

ICAO panels and working groups, and the high regard for Australia's contribution to the work of ICAO.

C A S A A n n u a l R e p o r t 2 0 0 4 - 2 0 0 5 41

Operational report

Objective

Maintain Australia’s international aviation safety reputation (continued)

On-track Delayed Achieved

By June 2005, substantial progress made towards conclusion of bilateral agreements with target nations:

• United States, Canada, Brazil, United Kingdom and China

The Executive Agreement of a Bilateral Aviation Safety Agreement with the United States has been signed and, at the time of reporting, final work is under way for the Implementation Procedures Airworthiness. An arrangement has been completed with the United

Kingdom. A final technical assessment of Civil Aviation Authority of China has been completed. Other arrangements have not progressed due to higher priorities and resource constraints.

Objective

Engage cooperatively with industry

Develop a program of industry interaction by the Chief Executive Officer and senior managers in operational areas

A series of industry consultation meetings have been held in Bankstown, Brisbane, Darwin, Cairns, Townsville, Adelaide and Perth This program will be continued in the 2005-06 period.

Meetings were attended by the Chief Executive Officer, Deputy Chief Executive Officer and other applicable senior managers within CASA.

Expand the role Forum (ASF) to f to the Chief Exec issues

)f the Aviation Safety >rovide strategic advice utive Officer on specific

Additional members were appointed to the Aviation Safety Forum during the reporting period to enhance the strategic role of the Forum. Consideration was also given to the role and structure of the Forum, with internal governance changes being made to the meetings structure and content to enhance its effectiveness.

Review the role c Consultative Corr providing an effec for CASA and the to consult on a w activities and sen

f the Standards imiitee (SCC) in ;tive mechanism aviation industry

der range of CASA /ices

The SCC formed a working group to consider:

• SCC working practices

• Possible future roles for the SCC.

The working group provided a report to the SCC. The SCC expects to provide its final recommendations to CASA following its August 2005 meeting.

Review and revise delegations framework and rationalise delegations Delegations for former Executive Manger Aviation Regulatory Services, General Manager Regulatory Services Branch and

Manager Business Development reviewed.

Review and revision of the Industry Delegates and Authorised Persons Management Manual commenced.

Implement scholarship program The first scholarship winner has been chosen.

Revision of the Scholarship Program is currently being examined, to enhance appeal and flexibility to potential participants.

Engage cooperatively with industry (continued)

O b je c tiv e

Performance targets

By December 2004, develop program of industry interaction

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20 per cent of the CEO's time allocated for industry interaction

On-track

On-track

On-track

By June 2005, complete review of the role of the Standards Consultative

Coiiimltee________

Performance targets

.

On-track

By 30 June 2005, delegations m framework reviewed and revised : On-track

By June 2005, implement scholarship program

Delayed Achieved

Delayed Achieved

Delayed Achieved

Delayed Completed

Delayed Achieved

C A S A A n n u a l R e p o r t 2 0 0 4 - 2 0 0 5

g

Operational report

GOAL: A HIGH PER FO R M A N C E O RG ANISATIO N

Objective

Increase overall efficiency by optimal use o f CASA resources

Conduct establishment review No longer relevant as the initiative was overtaken by new organisational structure announced on 1 July 2005.

Increase cost consciousness of all CASA staff

• refine and update financial systems to ensure they provide data that supports management decision making

Group General Managers included in 'bottom-up’ budget process to develop the CASA 2005/06 internal budget.

Quarterly forecasting introduced in March to enable managers to revise expenditure in line with business requirements.

Training sessions conducted for managers to assist their understanding of budgeting, forecasting and financial reporting.

• develop analytical commentary of expenditure for monthly CEO report Monthly CEO report enhanced to better reflect CASA’s financial position, including key ratios for liquidity, financial stability and net

worth.

Monthly variance analysis has been consolidated by Finance, to provide accurate and complete information to the Chief Executive Officer, while retaining Division Managers’ accountability for managing their budgets.

• closely monitor expenditure trends Monthly variance analysis examines expenditure trends and reports areas of concern to Chief Executive Officer.

Quarterly forecasting requires managers to acknowledge expenditure trends, identify their cause and assess their likely continuation or reversal.

Managers’ accountability for meeting forecasts is designed to produce quality forecasts.

Establish bottom-line budgeting within CASA Implementation attempted for 2005/06 budget. Due to CASA’s organisational restructure, historical cost information was of

limited value and managers were asked to estimate their funding requirements within Portfolio Budget Statements (PBS) limitations.

Further training of managers will be required for full implementation of bottom-up budgeting. This is planned for 2005/06

Intend to commence the 2006/07 budget process in November 2005 to provide more time for managers to assess requirements, including projects.

By June 2005, complete establishment review

On-track Delayed Not Applicable

■

Objective

Increase overall efficiency by optimal use of CASA resources (continued)

8 _ · ·' '■ ,· . : ■ ' On-track Delayed Achieved

By June 2005, develop measures of relationship between CASA expenditure and industry activity

Expenditure is limited to funding levels and two-thirds of CASA’s funds (fuel excise and fees for services) is linked to industry activity. The Long Term Funding Strategy proposed a ‘fuel reserve’ to create a funding buffer between changes in industry activity and the associated response with CASA’s activities. This arrangement was approved with the acceptance of the Long Term Funding Strategy.

Objective

Manage CASA’s activities and costs within a long-term funding strategy

Develop long-term funding strategy (LTFS)

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LTFS supported by Department of Finance and Administration, The Department of Transport and Regional Services (DOTARS) and Treasury and approved by Expenditure Review Committee (ERC) in March 2005.

Funding and expenditure levels proposed in LTFS documented in DOTARS Portfolio Budget Statements 2005-06.

Improve procurement capabilities in CASA Procurement is managed within Legal Services Group; however, other CASA areas will assist with a review of CASA’s procurement

policies and procedures, and make recommendations for implementation of best practise.

On-track Delayed Achieved

By December 2004, long-term funding strategy forwarded for government’s consideration

45 C A S A A n n u a l R e p o r t 2 0 0 4 - 2 0 0 5

Objective

Continuous improvement in CASA services, processes, techniques, systems, knowledge and information management

Continuously review CASA’s business processes to improve industry service delivery and achieve cost efficiencies

Successfully conducted a demonstration of concept on the Generated Minimum Equipment List (G-MEL) project. Business Case completed.

Measure and publish agreed service levels for regulatory services Completed. Service Centre ‘Service Commitment' brochure released during the reporting period. .

Implement Aviation Industry Regulatory System (AIRS) and service delivery model as a product of CASA Improvement Program

The Core Architecture for the new CASA System (AIRS) has been completed. Phase 1 functionality, which incorporates aviation industry individual participants and their licences (based on the new CASR Parts 61, 64 and 66), has been built and integration tested.

i ' ' 1

Phase 2 functionality, which incorporates aviation industry organisation participants, their certificates and the aircraft register has been built.

The training approach and design of training material for the implementation has been completed and training material preparation is under way.

Application support transition planning is in progress.

Implement a dedicated Design and Manufacturing Office from existing resources to service the needs of the Australian aviation manufacturing industry

The new Manufacturing, Certification and New Technologies Office will service the needs of the Australian aviation manufacturing industry. This Office commenced in operation in July 2005.

On-track Delayed Achieved

By June 2005, 85 per cent of General Aviation Air Operator’s Certificates, Certificates of Approval and Aerodrome Certificates will be issued within agreed timeframes

CASA exceeded the target in on-time issue of AOCs and COAs in the three quarters of 2004-05 (see Figure 10).

Figure 10 - On-time issue of AOCs and COAs

105%

95%

85%

75%

65%

55%

45%

35%

25%

Sept Dec Mar Jun Annual

m m m AOCs COAs ---------Annual Target

Note: data on issue of Aerodrome certificates not available

Objective

Continuous improvement in CASA services, processes, techniques, systems, knowledge and information management (continued)

Performance targets

Set benchmarks with relevant industry segments for timely delivery of regulatory service aSlSIS S

By December 2005, implement Aviation Industry Regulatory System

On-track Delayed Completed

The CASA Service Centre 'Service Commitment’ brochure outlines service delivery benchmarks for the provision of regulatory services.

ill On-track Delayed Completed

The implementation date for the combined release of the System, which incorporates Phases 1 and 2, has been set at September 2005.

Objective

Achieve a high level of awareness of government reform agenda, respond fully to government policy directions

Strateg ies/ln itiati ves

Conduct bi-monthly meetings with Minister and Secretary of the Department of Transport and Regional Services

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Conduct a cost recovery review, in line with the government’s guidelines and schedule

Progress report

Meetings with the Minister including the Secretary of the Department of Transport and Regional Services and the Chief Executive Officer have been held on three occassions.

Regular meetings were held with representatives of DOTARS to support the introduction of new aviation security initiatives as specified by the Government.

Implementation of the first phase of the cost recovery program scheduled for January 2006.

C A S A A n n u a l R e p o r t 2 0 0 4 - 2 0 0 5 » > 4 7

Objective

Achieve a high level of awareness of government reform agenda, respond fully to government policy directions (continued)

Support new aviation security initiatives as specified by government CASA has fully supported the aviation security initiatives where it has statutory responsibility, such as photo licences.

Throughout the reporting period, CASA worked with the Department of Transport and Regional Services, Office of Transport Security in relation to the amendment of the Aviation Transport Security Act 2004 and the preparation of the Aviation Transport Security Regulations 2005, All applicants for flight crew licences and special pilot licences now undergo a full aviation security check and assessment including a criminal record check. Existing licence holders are also undergoing the security check and assessment in line with the new Aviation Transport Security Regulations 2005.

Support the safe and timely implementation of National Airspace System (NAS) stages

· CASA is supporting the safe implementation of NAS in a timely manner and engaging pro-actively to give effect to decisions made.

• CASA is ensuring all regulatory issues are dealt with to enable changes in NAS to be implemented.

• The NAS Project Team was established in March 2005 to assist with ensuring CASA has a thorough and consistent approach to NAS matters. This will as required include the development of cohesive policies and procedures and clear reporting guidelines.

On-track Delayed Achieved

By June 2005,increase cost-recovery revenue to $5 million per annum Fees increased 1 July 2004 to boost cost recovery revenue to $5m Actual cost recovery revenue for 2004/05 of was $4.896m, which was

2% below target, due to lower demand for some services.

On-track Delayed Completed Not Due

By December 2005,submit cost recovery review report to government CASA’s Cost Recovery Impact Statement (CRIS) will be delivered as part of the 2006/07 budget process in February 2006.

Objective

Motivated, capable and high-performing people

Strategies/Initiatives Progress report

Continue implementing People Management Strategy: Completed. Revision of processes and procedures has now been undertaken. Establishment of the Learning and Development

Advisory Group has assisted in applying processes and procedures across C ASA

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implement learning and across CASA

development systems and procedures Work has also progressed in relation to building an e-learning

environment with the purchase of on-line build tools. environment with the purchase o, on-line

Develop an occupational health and OHS Strategy developed and operating, safety (OH&S) strategy that supports a safe and healthy workplace OHS Agreement has been finalised and has been provided to ■ applicable parties for final agreement.

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Audit and Risk Committee referred OHS implementation plan to internal auditors KPMG for review. Audit report noted that OHS plan adequately addresses OHS legislative requirements at high level and should assist in ensuring appropriate framework is in place to : Affortivplv mansriA CAFiA’s DNS mcnnnsihilitip'S

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effectively manage CASA’s OHS responsibilities.

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Improve flexibility in workforce CASA has developed and delivered a draft CA that provided the management by: CASA position to the staff associations. The draft supports the

business outcomes being sought out of the CASA reforms. It provides

• a new Certified Agreement (CA) an employment framework that will help to deliver CASA’s business that is designed to deliver business outcomes outcomes

conditions of service that support business outcomes

Performance targets

By June 2006, improved satisfaction in CASA staff survey

By June 2005, occupational health and safety strategy developed

On-track Delayed Completed Not Due

An employee survey is proposed following the completion of the organisation re-structure.

On-track

On-track

Delayed

Delayed

Achieved

Completed

New Certified Agreement to be negotiated by June 2005

Operational report

Objective

Deliver enhanced level of organisational integrity, ethics, probity, governance and accountability

Introduce an internal reporting mechanism on organisational shortcomings (whistleblower scheme)

The Protected Disclosure Policy (whistleblower scheme) was implemented on 24 May 2004 and is fully operational.

Develop a three-year, risk-based internal The new internal audit Charter for the Audit and Risk Committee audit program implemented. The Audit and Risk Committee (ARC) has met on a

regular basis.

• implement new internal audit Charter for the audit and risk The second annual report of ARC has been completed, and the committee second annual self-assessment exercise has been undertaken.

Enhance performance management in CASA • Training of managers in budgeting, forecasting and financial reporting was delivered in 2004/05 and will continue in 2005/06.

• Quarterly forecasts provide flexibility for managers to manage expenditure to meet business needs while continuing to manage their bottom line.

• Mid year review enables senior management to consider any financial issues and take early corrective action. This reporting framework is in line with best practise.

• Revisions to senior manager and all staff performance management processes is expected to achieve enhanced performance outcomes for CASA.

Continuously improve the quality of reporting in the Annual Report • CASA showed a marked improvement on quality of its reporting in by gaining recognition by way of a Gold Award from the

Institute of Public Administration Australia (ACT Division) and a Bronze Award from the Australasian Annual Reporting Awards for the 2003-2004 report.

Maintain task-tracking tool to ensure organisational performance on operational tasks and deadlines

• The task tracking tool has been developed and is operational.

On-track Delayed Completed

By June 2005, whistleblower scheme operational The Protected Disclosure Policy was fully operational from 24 May 2004.

On-track Delayed Completed Not Due

By June 2006, survey of CASA staff shows high awareness of and confidence in the whistleblower scheme

Survey will be conducted during the 2005-06 financial year.

A number of staff awareness courses were held during the year in relation to Fraud, Ethics and Privacy issues which reinforced understanding of the whistleblower scheme.

___________ ___ - __________

Objective

Deliver enhanced level of organisational integrity, ethics, probity, governance and accountability (continued)

Performance targets

On-track Delayed Completed

By June 2005, Divisional Business Delay a result of CASA restructure and confirmation of Senior Plans form part of Divisional Managers’ Management Group employment arrangements. Performance Agreements with Chief Operating Officer

On-track Delayed Achieved

Feedback from individual users and CASA’s 2003-04 Annual Report won the Gold Award from the Institute formal assessments by the Joint of Public Administration Australia (ACT Division) and also a Bronze Committee of Public Accounts and medal from Australasian Reporting Awards for the same publication, annual reporting award bodies

Perform ance reporting against portfolio budget statements

Objective

Simple to use, clear and concise aviation standards and rules based on known risk factors

■ ■ . ■ ■

Industry acceptance of the rules :

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Industry is becoming increasingly involved in the development of CASA’s standards either though public consultation or through their representation on the SCC. The role of industry in the regulatory development process to be further enhanced through the application of the CEO Directives 16 and 17.

Objective

Use CASA safety education programs to promote industry’s responsibility for aviation safety

Safety education program customised to meet needs of industry sectors Flying instructor training program developed by with industry panel. Work commenced with helicopter operators on instructor handbook.

Risk management education program developed for operators of ex-military aircraft.

Percentage of resources for safety education reviewed Availability of non-Aviation Safety Promotion (ASP) staff increasing with input and participation from other areas of CASA i.e. former

business divisions of Office of Legal Counsel, Aviation Safety Standards, Aviation Safety Compliance and Regulatory Reform Programme Implementation. Nine individuals from these areas of CASA participated with the three ASP Program Delivery staff.

C A S A A n n u a l R e p o r t 2 0 0 4 - 2 0 0 5 51

Operational report

Objective

Continuously improve the delivery of CASA services to industry

Annual sui representa f k I d t y · During the year, ninety per cent of industry recipients indicated

iers and satisfaction with the regulatory services provided by the CASA

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Extremely Satisfied Neutral dissatisfied Extremely

satisfied dissatisfied

Number of processes for entry to the Industry delegates processes currently being reviewed.

Air Operator Certification Manual revised.

Improve effectiveness of CASA’s surveillance program in contributing to better safety outcomes

Objective

Performance measures Analysis

CASA and industry complying with the procedures laid down in the Surveillance Procedures Manual (SPM)

In the June quarter, Quality Reviews (QRs) were completed for the South Queensland Area Office, Melbourne Airline Office and Sydney Aerodromes. The QR of the Northern Territory & Kimberleys Area Office originally planned for July 2005 was also brought forward into the June quarter, and was successfully completed. All reports with the exception of Sydney Aerodromes are complete including the QR report for the NSW Country Area Office audit conducted in the previous quarter.

As a result of the organisational restructure, the majority of audits and associated reports were completed using a single Quality and Safety Systems Engineer due to the secondment of the second quality auditor into the Personnel Licensing, Education and Training Group. The remaining Quality and Safety Systems Engineer also assisted with a special quality system audit undertaken by the Melbourne Airline Office.

All General Aviation Field Office audits conducted by the former Compliance Division are being finalised and files are presently being transitioned to the GA Operations Group. All previously scheduled Air Transport Operation Group (ATOG) audits have been placed on hold, and a new schedule specific to the responsibilities of ATOG Quality and Development Section is being prepared.

Number of operators audited according to the surveillance plan — r

General Aviation 100% 97% 91% 80% 92%

Airline 94% 99% 100% 99% 98%

Operations

Aviation Infrastructure and Sports Aviation

107% 105% 90% 103% 101%

STI ‘desktop’ audits 100% 100% 98% 94% 98%

C A S A A n n u a l R e p o r t 2 0 0 4 - 2 0 0 5

Operational report

Objective

Improve effectiveness of CASA’s surveillance program in contributing to better safety outcomes (continued)

Performance measures Analysis

On average CASA completed ninety four igure 12 Compliance audits - Genera! Aviation per cent (487 of 523) audits scheduled for general aviation for 2004-05 (see figure 12).

At the end of the financial year thirty six audits (6 per cent of scheduled audits) remain outstanding.

Of these, twenty per cent have been completed and are being finalised, eight per cent (3 operators) are not operational, thirty three per cent are to be rescheduled under the new Risk Based Audit System and thirty one per cent are delayed due to resource issues.

- 100%

I Planned

Quarter

Completed O utstanding ❖ % com pleted

On average CASA completed ninety nine per cent (2887 of 2917) of STIs scheduled for 2004-05 (see figure 13).

At the end of the financial year, thirty STIs (1 per cent of scheduled STIs) remain outstanding.

Of these, seventeen per cent have been completed and are awaiting finalisation and seventy per cent delayed due to resource issues.

Figure 13 General Aviation STI ‘desktop’ audits

800 - ♦ 105% : ♦ 100% ^ ^ 9 9 % 1008

I [ l · f .-r— --------------------τ— --------------------r— ------------------ -- 60% 600

-5 400

o

200

Mar Jun

Quarter

On average CASA completed ninety seven per cent (186 of 192) of audits scheduled for domestic airlines for 2004-05 (see figure 14).

At the end of the financial year, five audits (3 per cent) remain outstanding. Of these, two audits are delayed due to resource issues and replanned for August 2005. Remaining audits are not applicable as either operators have ceased operations or not operating as an Australian Registered Aircraft

■ planned Completed Outstanding Φ %com pleted

' 1 * ' '

ure 14 Compliance audits - Airline Operations

^ 90% . |

I 40

Sept Dec Mar Jun

Quarter

Planned Completed Outstanding ♦ % c o m p le te d

Improve effectiveness of CASA’s surveillance program in contributing to better safety outcomes (continued)

O b je c tiv e

Performance measures

On average CASA completed ninety nine per cent (222 of 225) of audits scheduled for aviation infrastructure and sports aviation for 2004-05 (see figure 15).

The three remaining audits are from aviation infrastructure and will be rescheduled for completion in the next financial year.

: ■

Analysis

Figure 15 Compliance audits - Aviation Infrastructure & Sports

The special audits are based on safety intelligence and are planned and carried

! Planned

Figure 16 Special audits 2004-05

Quarter

Completed Outstanding Φ %completed

. v:..;·. y4 ' - 4;' -

Objective

Improved enforcement regime

Consistency of application of informal enforcement actions Closer working relations between Enforcement and Investigations and Compliance Division during the reporting period has resulted in

achieving better consistency in overall input from CASA Area Offices.

New procedures have been finalised to formalise these closer working arrangements. These procedures will be included in the Enforcement Manual (and introduced as the Chief Executive Officer policy if necessary) during 2005/06.

Make decisions based on risk assessment

O b je c tiv e

Performance measures Analysis

COMCOVER benchmarking outcome for risk management framework

1181

.

;

,

■ I

CASA received a score of 4 out of 5 for its risk management framework and received five per cent discount on its insurance premium from COMCOVER.

• CASA has been placed in the highest percentile of 135 Australian Public Service and private sector agencies surveyed. CASA's benchmarking score reflects the advanced implementation of a comprehensive and integrated risk management framework.

BM

|§ g

■

Policy and procedural suite updated to reflect the new CASA structures and accountabilities

Objective

Maintain Australia’s international aviation safety reputation

Maintain position of Australia as one of top ten International Civil Aviation Organisation (ICAO) States

Australia was re-elected to Group 1 of the Council of ICAO at the 35th Assembly in September/October 2004 as a 'State of Chief Importance in Air Transport.

■ ' | ■

The 35th Assembly increased the size of Group One from 10 to 11 States, so reference to "top ten' ICAO States is no longer appropriate.

Annual survey of key international industry representatives The recently established Certification Working Group under the Government’s Aerospace industry Action Agenda will provide a useful

forum to initiate a survey of international industry representatives.

Objective

Increase overall efficiency by optimal use of CASA resources

CASA resource allocation integrated with organisational design Change Implementation Team tasked with implementing strategies proposed in the Long Term Funding report, including assessing the

way CASA provides services, with particular focus on improving efficiency of support (non-core) functions.

Continuous improvement projects have been identified by the Finance Office in the areas of financial reporting, credit card administration and month-end processing.

Ι||||||κ CASA’s Organisational restructure introduced on 1 July 2005

accentuates CASA’s core business focus.

O b je c tiv e

Achieve a high level of awareness of government reform agenda, respond fully to government policy directions

CASA Performance Agreement established The draft CASA performance Agreement was forwarded to the Minister for his endorsement.

Objective

Continuous Improvement in processes, techniques, systems and knowledge and information management

New tools and systems implemented * Applications Development and Maintenance

- Production systems databases upgraded to Oracle 9i.

Human Resource Management System (HRMS) and Financial Management Information System (FMIS) amended to facilitate new organisational structure

- Learning Management Survey loaded into HRMS

: - ' Enhancements released for Safety Trend Indicators (STI),

Service Difficulty Reporting (SDR), Airworthiness Directives

j f m l j | Workflow (ADW) and Flying Currency and Training (FCAT) · Infrastructure Services

- USB Memory Stick security project completed

. - XP Standard Operating Environment (SOE) rolled out to all

CASA laptops

- PABX operating system upgraded including voicemail and call accounting

V - Disaster Recovery Plan completed.

- Web Content Monitoring Tool (Content Keeper) deployed

• Information Services

- CEO Feedback Form and Management eRoom delivered

' · - Post Implemention report on New South Wales Country Area

Office Job Management System (JMS) eRoom delivered

Report delivered and distributed to Airservices Australia and third party suppliers on review and proposed consolidation of CASA publications

- V . - Branch Technical staff completed Information Technology

Infrastructure Library training

► » » CASA Annual R e por t 2 0 0 4 - 2 0 0 5 5 7

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1

Part 3

Corporate Report

CASA A n n u a l Report 2004-2005 5 9

Corporate report

Office of the Chief Executive Officer

Bruce Byron AM, Chief Executive Officer

Bruce Byron began his career in aviation in the Royal Australian Air Force (RAAF) in the mid 1960s, training on the Winjeel and Vampire aircraft. By 1968, Mr Byron was flying Caribou aircraft with No. 35 Squadron in Vietnam and during a 12-month tour flew 1600 operational sorties.

After returning from Vietnam he moved into flying training with the RAAF, the beginning of a career long association with training in both military and civilian flying. After time overseas as an instructor on exchange programs with both the United Kingdom RAF and the Singapore Air Force, Mr Byron was promoted to Wing Commander in 1980.

During 1982 and 1983 he was Commanding Officer of the RAAF Central Flying School, responsible for the training and checking of all military flying instructors in Australia. In 1984 Mr Byron was invested as a Member of the Order of Australia.

After leaving the RAAF, Mr Byron became an Examiner of Airmen with the Department of Aviation, flying over 20 different types of aircraft and flight testing pilots up to the senior commercial level. In 1988, he took over management of North Broken Hill Ltd's private jet operations, while also working as an aviation safety consultant in flight training, human factors and aviation management.

In 1999, Mr Byron took the position of Executive General Manager of Kendell Airlines at a time when the airline was introducing jet aircraft operations. This was followed by a period as Vice President Compliance and Quality Assurance with Ansett Australia.

Prior to joining CASA Mr Byron worked as a high-level consultant on aviation safety management in airlines, including a period as head of Safety Systems for Virgin Blue.

From 1997 to 1999, Mr Byron was a member of the Board of CASA, chairing the Board Safety Committee. In this key role he guided the development of new safety compliance and promotion activities.

Between 2000 and 2003, Mr Byron was chairman of the Aviation Safety Forum, a high-level industry group which advised the CASA Board and the Australian Government on strategic aviation safety activities. In May 2002, he was also appointed by the Minister for Transport and Regional Services as a special industry adviser to CASA on regulatory reform

Mr Byron has held an airline transport pilot licence, a command instrument rating and a grade one instructor rating. He has flown more than 10 000 hours during his aviation career to date.

Bruce Gemmell, Deputy Chief Executive Officer and Chief Operating Officer

Bruce Gemmell joined CASA on 9 April 2001. Mr Gemmell was previously a First Assistant Secretary in DOTARS with responsibility for aviation. In that role he gained extensive experience in all facets of aviation, with work including leading the Department's handling of the Mobil Avgas fuel contamination crisis in 2000,

and leading the successful negotiation of Australia's first ever Open Skies' Ah Services Agreement with New Zealand.

Mr Gemmell's relationship with Australian aviation spans more than 15 years. He was one of the inaugural Civil Aviation Authority staff members, including being the initial project manager for what is now the Australian Advanced Air Traffic System and was a Director with the Department of Aviation in 1985. His public sector administration experience spans more than 30 years.

C A S A A n n u a l R e p o r t 2 0 0 4 - 2

Corporate report

Senior Managers

Richard Macfarlane

Acting Executive Manager Aviation Safety Standards

Rob Collins

Executive Manager Aviation Regulatory Services

Peter llyk

General Counsel

Arthur White

Acting Executive Manager Aviation Safety Compliance

Betty Edwards

Chief Financial Controller

Karen Nagle

Risk Manager

Nicola Hinder Gary Harbor

Acting Executive Manager Corporate Affairs

Head Human Resources

Michael Minns

General Manager Information Resource Management

C A S A A n n u a l R e p o r t 2 0 0 4

Corporate report

Senior management changes during the year

There were three changes in the occupancy of senior management positions during the year. Ms Sue-Ellen Bickford, Executive Manager, Corporate Services, Mr Ray Comer, Executive Manager, Corporate Development and Mr Bill McIntyre, Executive Manager, Aviation Safety Standards left CASA between December 2004 and January 2005.

Responsible minister

During the period of this report, the responsible Minister was the Hon. John Anderson MR, Deputy Prime Minister, who held the post of Minister for Transport and Regional Services since 21 October 1998.

On 6 July 2005, the Hon Warren Truss MR was appointed as the Minister for Transport and Regional Services.

Governance

Corporate governance changes were introduced in the Civil Aviation Amendment Act 2003, which became law on 21 October 2003.

These changes:

® abolished the CASA Board, but retained CASA as an independent statutory authority;

® designated the Director of Aviation Safety as chief executive officer, responsible for managing CASA under the Minister; and

® gave the Minister stronger and more direct control over CASA's governance and accountability.

Under the CASA corporate governance arrangements, the Director of Aviation Safety (the CEO) is directly responsible to the Minister for CASA's management.

Under the Civil Aviation Act, the Minister may require CASA to act in accordance with directions or notifications about:

® the way its functions are performed and powers are exercised (section 12)

® strategic directions (section 12A)

® supplying documents and information to specified nominees (section 12B)

® reporting (section 12D).

Section 12C of the Act also provides the Minister with the power to enter into an agreement with the Director (CEO) about the performance of CASA's functions and the exercise of CASA's powers. The Director (CEO) must take all reasonable steps to comply with the terms of an agreement,

In order to ensure regulatory independence, directions from the Minister about the performance of CASA's regulatory function can only be of a general nature. This restriction also applies to notices under section 12A and an agreement under section 12C.

There were no statutory directions or notifications under sections 12, 12A, 12B or 12D in 2004-05.

Executive Responsibility

Mr Bruce Byron, AM began a five-year term as Director of Aviation Safety and chief executive officer on 1 December 2003. Mr Byron is also the sole director of CASA for the purposes of the Commonwealth Authorities and Companies Act 1997.

Under the CASA corporate governance arrangements the role of the Director/CEO includes:

® managing CASA's day-to-day operations

® deciding the objectives, strategies and policies to be followed by CASA

® ensuring that CASA works within the broad framework of the Government's policies and priorities

® ensuring that CASA performs its functions in a proper, efficient and effective manner.

Mr Gemmell acted as the Chief Executive Officer on two occasions during the reporting period. Mr Rob Collins acted as Deputy Chief Executive Officer and Chief Operating Officer in these periods.

Audit and Risk Committee

As required by the Commonwealth Authorities and Companies A ct 1997, CASA maintained an audit committee throughout 2004-05 to support effective corporate governance.

The committee comprised:

® Barbara Yeoh, Chair (April 2004 to present)

® Martin Dolan (April 2004 to June 2005)

® Michael Lewis (April 2004 to present)

® Bruce Gemmell (April 2004 to present)

® Mr David Andersen (Secretary)

C A S A A n n u a l R e p o r t 2 0 0 4 - 2 0 0 5

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Corporate report

See page 172-173 for details of the qualifications and experience of Audit and Risk Committee members.

There were seven meetings of the Audit and Risk Committee during 2004-05. All members were present at each of the meetings they were eligible to attend.

The committee operates under a charter and, as constituted since April 2004, has an independent chairperson. It reports to the Chief Executive Officer and has direct access to internal and external auditors, the Chief Financial Controller, the CASA Risk Manager, General Counsel and senior management.

The committee assists in assuring compliance with CASA's obligations under the Civil Aviation Act, the Commonwealth Authorities and Companies Act and other applicable legislation, regulations and codes of practice and conduct.

It is also specifically charged with overseeing the risk management function.

During the year, the committee:

® provided a forum for communication between the Chief Executive Officer and CASA's internal and external auditors

® provided guidance on the effective management of risk

® advised the Chief Executive Officer on aspects of internal and external audit, accounting procedures, systems, controls, and financial reporting

® promoted accurate, quality and timely disclosures of financial and other information to the Chief Executive Officer and other key stakeholders, such as the Minister

® examined internal audit reports.

Management structure

The CEO's responsibilities call for a practicable balance between leadership and operational involvement. As part of the 'Building a New CASA' programme of reforms was the release of the new high-level organisational structure which was implemented on 1 July 2005. While only a part of a larger reform process, this new structure aligns CASA more closely with the way the aviation industry operates.

The management structure during the reporting period, and the management structure post 1 July 2005 allows the Chief Executive Officer to focus on strategic direction, policy setting and CASA's relationship with stakeholders, while maintaining the necessary oversight of operations and ultimate financial control.

Key features of the arrangement are:

® devolution of day-to-day overall management responsibilities to the Chief Operating Officer

® creation of a support structure for the Chief Executive Officer, with strategic research, planning, communications and operational analysis capabilities that are independent of line management

® direct reporting to the Chief Executive Officer on all risk and audit matters

® direct reporting to the Chief Executive Officer on legal matters relating to governance, conformity with the Civil Aviation Act, the Commonwealth Authorities and Companies Act and other legislation or government guidelines

S> the responsibility placed upon senior managers to make decisions relevant to their areas.

A robust communication and information sharing system and a disciplined approach to reporting maintains a chain of accountability within CASA to the Chief Executive Officer and from the Chief Executive Officer to the Minister.

The Chief Executive Officer provides a written monthly report to the Minister on CASA's operational performance. In addition, the Chief Executive Officer has a face-to-face meeting with the Minister so there is an opportunity to allow both parties to raise and discuss issues. There were three such meetings in the period to 30 June 2005.

In line with the Minister's desire to develop and maintain a whole-of-portfolio perspective on aviation issues, the Secretary of the Department of Transport and Regional Services (DOTARS), Mr Michael Taylor, receives a copy of CASA’s monthly reports and is present at the Chief Executive Officer's regular meetings with the Minister.

As well as day-to-day contact, there are two scheduled monthly meetings between the Chief Executive Officer and Chief Operating Officer. One is an all­ day informal meeting to discuss issues: at the other, the Chief Operating Officer formally reports to the Chief Executive Officer on all delegated operational responsibilities, Chief Executive Officer decisions are made and minutes are kept.

There were twelve formal Chief Executive Officer meetings in 2004-05.

In turn, the Chief Operating Officer has a scheduled formal monthly meeting at which senior managers propose matters for decision by the Chief Operating Officer. There were twelve formal Chief Operating Officer meetings in 2004-05. Three times a month the senior management group meets to share information.

Effective Management

Internal audit

CASA outsourced the bulk of internal audit service provision to two external providers in 2002 to allow it to focus on improving internal audit management. The value of outsourcing continued to be evident in the attention CASA was able to give to internal audit in 2004-05.

Work during the year has ensured that audit planning now better reflects key risk exposures, with divisional risk management plans used to directly inform the priorities for the 2005-06 internal audit programme.

CASA also gave attention to translating audit findings into management action and operational improvement. A formal program to monitor and follow-up on the implementation of audit recommendations was established and is backed by a

database.

The effectiveness of this follow-up in ensuring timely management action will be a key performance indicator for the internal audit function in the future. The 2004-05 audit program covered a range of CASA's core business and corporate functions, processes and systems. These investigations benefited from the expertise and 'distance' of auditors external to CASA.

C A S A A n n u a l R e p o r t 2 0 0 4 - 2 0 0

Corporate report

Risk management

CASA is in the top quartile of Comcover agencies and in Comcover's 2004 benchmarking exercise, CASA's benchmarking score remained constant at 4 out of a possible 5. As a result of this outcome, CASA received a five percent discount on its insurance premium from Comcover. CASA is proud of this achievement, as it signifies that the Authority remains in the highest percentile of Agencies and Departments under this framework.

During the reporting period, CASA refined and improved its strategic risk assessments through use of a database that enables identification of common sources of risk and risk treatments.

This risk profile was a key enabler of the assumptions underpinning the CASA Corporate Plan for 2005-06 to 2006-07. CASA also significantly improved the format and content of divisional risk management plans. Collectively these operational risks form the basis for CASA's Operational Risk Profile.

A KPMG audit of CASA's risk management planning framework undertaken during the year informed our strategies for future improvement.

An important project for risk-based regulation was development of a 'proof of concept' quantitative risk model, implemented as a ‘desk-top tool'.

The model assesses, compares and predicts aviation safety risk using a number of parameters such as operators, sectors or locations. It can be used to inform CASA about whether or not a specific incident represents a net increase in overall safety risk.

The risk model uses aviation data derived from the Australian Transport Safety Bureau

(ATSB) Aviation Safety Incident Reports, Airservices Australia Electronic Safety Incident Reports and CASA's own Major Defect Report/Significant Defect Report database. Audit data from Requests for Corrective Action will be added to these inputs in the future.

During the reporting period, the desk-top tool was trialled in the CASA Airline Offices.

The outcomes of the trial have been analysed and recommendations for future improvement have been submitted to the Acting Group General Manager of the Air Transport Operations Group. CASA intends that this work be expanded in 2005-2006 to include a qualitative model for the General Aviation Operations Group.

Coherent policies

During 2003-2004, CASA conducted an exercise to identify and collate all high-level CASA operational and corporate policies for examination as a whole and to determine the future arrangements for policy authorisation. As a result of this work, a framework was developed for the future classification of policy, directives, instructions and procedures. This work was completed in 2004-2005 with all CASA policies collated and re-issued by the Chief Executive Officer.

Consistent actions and decisions

Consistency in regulatory approach and decision making is a challenge for CASA, which is a national organisation with a large number of staff dispersed across offices located across the country.

Current programs for reforming safety standards, improving surveillance techniques and introducing new enforcement tools add to this challenge. While progress has been made over the past couple of years, actual and perceived inconsistency continues to be a strong source of grievance in the industry.

< § >

CASA's Office of Legal Counsel continued to provide general training on legal issues, including legal interpretation, to CASA's area and airline offices.

In addition, CASA's Learning and Development Section, in conjunction with technical experts, ran programs throughout the year on administration of specific regulations ranging from permissible unserviceabilities to dangerous goods acceptance. CASA staff also received training during the year in new regulations as part of implementing regulatory reform.

Last year CASA introduced a series of aviation 'rulings' setting out CASA's policy on issues found to have caused confusion in the industry. The rulings are intended to set out CASA's formal interpretation of particular regulations. They are published on CASA's web site for the benefit of industry and are used by CASA staff to properly and consistently apply the regulations.

In 2004-05 CASA issued 5 aviation rulings covering:

® The serviceability of instruments and equipment for charter and regular public transport aircraft;

® The carriage of infants and children in excess of aircraft flight manual limitations

® Classification of aerial work operations carrying passengers

® Training and Checking: number of checks "each calendar year"

® Approval to manufacture components in the course of maintenance CMITCOM1 )

Probity

Whistleblower protection

For a number of years CASA has run a confidential hotline, which has proved very effective in encouraging people in the industry to come forward with aviation safety concerns. In the reporting year 2003-2004 CASA took the important complementary step to detect illegal and improper conduct within its own organisation.

In May 2004 CASA established a protected disclosure policy. The policy responded to a request in the Minister's November 2003 Charter Letter for CASA to develop an appropriate whistleblower scheme. The protected disclosure policy lists various types of activities that may be reported under the policy, including activities that are illegal, dishonest, fraudulent, corrupt, unethical, improper, unsafe or wasteful.

Under the policy, CASA will take all lawful steps to protect the identity of a whistleblower and will ensure they are not dismissed, demoted, harassed, victimised or discriminated against as a result of making a report in good faith.

A major feature of the scheme is that disclosures of impropriety are made not to CASA, but to an independent organisation (STOPline) which has significant expertise in dealing with whistleblower disclosures. Under the arrangement, STOPline regularly monitors CASA's actions in dealing with disclosures, and

reports are provided to CASA's Audit and Risk Committee. During 2004-2005, four

allegations were reported to STOPline.

C A S A A n n u a l R e p o r t 2 0 0 4 - 2 69

Code of conduct

All CASA staff must comply with a comprehensive code of conduct as a condition of their employment or engagement. An Interim Code of Conduct was developed in conjunction with CASA's Certified Agreement for 2002-05 and is a schedule to that agreement.

CASA will revise the Code in conjunction with development of the new Certified Agreement to ensure that it fully reflects the values and behaviour emphasised in the Minister's Charter Letter of November 2003. The new Certified Agreement was under development in 2004-2005 and is expected be completed early in the 2005-2006 reporting period.

Conflict of interest

As a sole director, CASA's Chief Executive Officer is required to disclose 'material personal interests' to the Minister for Transport and Regional Services. Mr Byron submitted a declaration to the Minister on 20 May 2004. Mr Byron routinely declares at each monthly Chief Executive Officer meeting any issues that could have the potential to create a conflict of interest or be perceived as a conflict of interest.

As a regulatory authority, CASA takes particular care to guard against actual, potential and perceived conflicts of interest in respect of all staff.

There is a considerable interchange of personnel between CASA and the industry which, though highly beneficial to aviation safety, may give rise to conflicts of interest in particular regulatory matters. Conflicts of interest may also arise through significant shareholdings or family connections.

CASA has a well-established policy, which sets out guiding principles for the consistent handling of conflict of interest issues in accordance with CASA's code of conduct, and procedures for declaring such conflicts. The policy applies to all personnel engaged by CASA as permanent and temporary employees, contractors, consultants and agency staff.

Permanent and temporary employees, and agency staff complete a Conflict of Interest Declaration Form on commencement with CASA. Staff receive an annual reminder of their obligations, including updating their Declaration.

With consultants and contractors, CASA's standard form contract of engagement imposes the obligation to declare any actual or potential conflict of interest that may arise through the life of the contract. Senior managers are responsible for resolving conflict of interest issues to ensure CASA's regulatory activities are not compromised.

The approach is usually to rearrange regulatory duties or responsibilities.

Fraud control

In accordance with the Commonwealth Fraud Control Guidelines 2002, CASA has undertaken a fraud risk assessment and prepared a fraud control plan. Appropriate fraud prevention, detection, investigation and reporting procedures are in place and annual fraud control data has been collected and reported as required.

People

CASA's objective is to achieve a high performance organisation through motivated and capable people. It therefore aims to provide an environment that supports the ongoing development and effective management of staff at all levels.

Learning and development

During 2004-05, CASA continued with its Learning and Development Strategy, which is designed to build organisational capability.

Learning and development initiatives and activities were grouped around:

® High Performance Leaders and Managers

® Core and Specialist Development Programs

® Corporate development initiatives

® Individual Learning Support

® Infrastructure Development.

The CASA Team Leadership Program continued to be successfully employed, with a majority of CASA's frontline managers participating during the year. The program focuses on coaching, counselling and performance management skills and is also used for succession planning purposes.

Throughout the year, there was a major effort to strengthen CASA's learning and development infrastructure, with a focus on efficient and effective production and delivery. A number of technical training programs were developed using quality standardised templates and a partnership approach between technical and training specialists. Following direction from the Chief Executive Officer, the CASA staff

Induction Programme is being re-examined with a focus on production during 2005-2006.

Core and specialist development programs are offered through an annual training calendar. CASA will continue to deal with the high demand for learning and development utilising the most cost effective and appropriate delivery mechanisms. A challenge for the future will be balancing the need for CASA staff to have training in the new regulations (as part of the regulatory reform implementation) with day-to-day operational requirements.

Training effort

This year there was an average of 5.53 training days per employee, which was above CASA's target of five days and slightly below the external benchmark of six days.

Workplace relations

CASA continued work on the initiatives contained in the CASA Certified Agreement 2002-2005. Progress was made in a number of areas, including developing a human resources guide, finalising the implementation of salary classifications for Flying Operations Inspectors and advancing the development

of a broadbanding methodology for CASA. These issues are being progressed as part of the negotiations for the revised CASA Certified Agreement.

The Workplace Relations Group, which is the peak level union-staff-management consultative forum, met four times during 2004-05, providing the opportunity for consultation on significant strategic, organisational and people management issues during the year.

Corporate report

Occupational Health and Safety

Following a review of CASA's existing occupational health and safety (OH&S) policies in 2002-03, work was finalised on a number of key elements that will help achieve CASA's OH&S commitments and targets.

These were:

® an undertaking by the CEO to sign an Employer Statement of Commitment between CASA and Comcare, to manage and support OH&S issues in the workplace

® development of a draft Strategic Plan, and draft OH&S Policy and Agreement to provide CASA with a strategic approach to implementing and supporting workplace safety.

During the reporting period, CASA finalised the OH&S Strategy and it has been implemented throughout the organisation. In addition, a revised OH&S Policy has been finalised. As part of the ongoing Safety Management System review and implementation, a CASA framework for the provision of Personal Protective Equipment based on appropriate job safety analysis was also drafted within the reporting period, and will be finalised early in the 2005-2006 reporting year.

The OH&S sub-committee, which comprises union officials, workplace delegates and senior managers, met four times during 2004-05. The role of the sub-committee is to provide strategic comment, advice and assistance on OH&S issues, and to develop programs and measures to continuously improve the health and safety of all CASA employees.

The sub-committee's work during the year included:

® the OH&S Management System; and

® Developing the CASA OH&S strategy; and

® Developing the OH&S Plan

An occupational health and safety report, in accordance with section 74 of the Occupational Health and Safety (Commonwealth Employment) A ct 1991, is provided on page 111.

Recognising high performance

CASA's people management policies and practices seek to support high performance across the organisation. Two important components of the performance arrangements in place within CASA are:

® the Performance Communication Scheme

® CASA's Recognition Scheme.

The Performance Communication Scheme aims to link individual contributions to organisational objectives. The Scheme is based around twice-yearly discussions between managers and staff, focusing on work goals and outcomes. A further important facet of the Scheme is the discussion between a staff member and their manager, addressing learning and development needs.

The Recognition Scheme provides an opportunity for staff and managers to nominate high performers for CASA's Employee of the Month Award, or for an 'Above and Beyond Award'. The Scheme is designed to reinforce the CASA values and associated behaviours, and encourages staff to see these values and

behaviours as an important feature of high performance in CASA.

The Scheme also includes recognition of an employee's ongoing CASA service and contribution service, at five-year milestones, commencing at 10 years' service.

The Scheme has been widely embraced by staff and managers and is recognised as contributing positively to morale.

Employee of the Year - 2004

Brett Owens was named both the November 2004 CASA Employee of the Month and 2004 Employee of the Year.

Brett received his award as part of the CASA Staff Recognition Scheme, which was introduced in 2003 and recognises staff for years of service as well as individuals and teams for consistently working hard and going beyond what is expected of their role.

The Employee of the Month is awarded to an individual whose work is regarded as displaying excellence in service that meets or exceeds CASA's values. Employees recognised under the scheme are nominated by their managers or colleagues.

Brett, a facilities asset manager from CASA's Head Office in Canberra has been with CASA for almost 10 years, and in his role coordinates the day-to­ day running of all the CASA buildings, office fit-outs, the supply of assets, the procurement and disposal of fleet vehicles and the management of national office cleaning contracts.

He received nominations from a range of colleagues who recognised him for his thoughtfulness, willingness to help others and provision of timely and quality service.

Nominees also noted his professionalism at all times, and maintaining a sense of humour even under difficult circumstances, while still delivering a quality service.

Addressing priority concerns, dealing with all matters effectively and efficiently, as well as his integrity and professionalism with both staff and external clients, were also listed in the nominations.

C A S A A n n u a l R e p o r t 2 0 0 4 - 2 0 0

Corporate report

A bove and Beyond award

As part of the CASA Staff Recognition Scheme, the Above and Beyond award is presented to both individuals and teams whose outstanding and exceptional performance is seen as going 'above and beyond' the call of duty.

Craig Hinder was named as Above and Beyond award winner for August 2004.

Craig is a senior officer with the Air Transport Operations Group Policy and Development branch.

Nominated for the award by his manager, Craig was recognised for taking the initiative and providing the drive and dedication to develop group outcome and output reports for the Chief Executive Office and Chief Operating Officer meetings.

These reports detail the group's performance and highlight significant trends which may impact on safety in the industry and CASA's response to those trends.

Providing such detail and insight on the industry has been a challenge in the past and Craig's initiative is working to overcome the issues behind the challenge.

Craig was also nominated for establishing systems and schedules to ensure the group provides quality products within required deadlines, his dedication to a quality and timely service, meeting deadlines and striving to improve the performance of his team.

Max McRae, Simon Astill and Wayne Jones, as the three Extended Range Operations by Turbine-engined Aeroplanes (ETOPS) course project team members received a CASA Above and Beyond award during the reporting period.

The team members were recognised for their partnership approach to developing an ETOPS training module for CASA's inspectors. Feedback from both CASA people and industry members who have attended the ETOPS presentations included comments on the professionalism of the package, usefulness to staff and industry and the opportunities it provides to enhance working relationships. Feedback also indicated

that the dedication shown by the three project members was exceptional.

©

They worked long hours to produce the learning materials, with some training attendees - most notably major airline representatives - commenting that it was one of the best presentations they had seen.

Wayne Jones

C A S A A n n u a l R e p o r t 2 0 0 4 - 2 0 0 5

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Corporate report

Workforce planning

During the reporting period, CASA continued its focus on a workforce planning reporting framework. As part of the framework, topical workforce planning issues, such as the issues related to an ageing workforce, are elevated for discussion to the CASA Chief and Deputy Chief Executive Officers.

As CASA continues to evolve through its new business model, further work will be undertaken, in conjunction with the 'Building a New CASA' reform programme in the area of workforce planning, with a particular emphasis on ensuring that CASA has the right skills mix within its staff for its aviation safety responsibilities.

Equity and diversity

CASA maintains its commitment to equity and diversity in its workforce and throughout the workplace. The Workplace Diversity Sub-committee is a part of CASA's workplace relations arrangements. It provides a forum for workplace delegates, union officials and CASA management to meet to discuss and promote these issues. The sub-committee met four times in the past year.

Staffing status report for 2004-05

Terms and conditions of employment

CASA staff are employed under the employment powers contained in the Civil Aviation Act. The terms and conditions of employees are based on the 2002-2005 Certified Agreement, Australian Workplace Agreements and common law contracts for senior managers. CASA also has a small number of service contractors and from time to time engages invigilators to oversee examinations.

At 30 June 2005, 95 per cent of CASA staff were employed under the Certified Agreement and 5 per cent under Australian Workplace Agreements, common law contracts or other arrangements.

Staff have access to a range of non-salary benefits, including superannuation, flexible working hours, purchased leave arrangements, study assistance, paid Christmas closedown, reimbursement for vacation childcare and access to an Employee Assistance Program. In addition, senior managers may access a CASA-provided motor vehicle as part of their gross remuneration.

Staffing profile

At 30 June 2005, CASA had 704 staff representing 95.5 per cent of its approved establishment.

Of this total:

® 97.3% were full-time and 2.7% were part-time

® 69.4% were male and 30.6% were female

® 11.2% identified themselves as belonging to an EEO group

® 36.3% were aged under 45 and 63.7% were aged 45 or over

® 53.3% were employed in Canberra and 46.7% in regional locations

s

Figure 16 Male Female Ratio - 30 June 2005

■ Male

■ Female

Figure 17 Gender Split by Job Families - 30 June 2005

§ W

See Tables 29-34 on pages 193-197 for further details of CASA's staffing.

Unplanned absences

The annual target for unplanned absences was 7.0 days per employee.

CASA's average for the year was 7.5 days per employee. This result is well within industry and public sector norms. The relevant Australian Public Service benchmark is 12.2 days per employee per year.

As an outcome of the audit of leave processing completed during 2004-2005, and as a mechanism of identifying any organisational issues surrounding the management of leave, an electronic leave and personnel management system - 'TESS' was introduced. This system will continue to enhance CASA's

understanding of leave requirements and assist in the Authority's future workforce planning requirements.

C A S A A n n u a l R e p o r t 2 0 0 4 - 2 0 0 5 77

Staff turnover

CASA’s rate of staff turnover remained acceptable with an annual average turnover of 8.27 per cent compared with 7.3 per cent last year. The turnover rate was within the target range of 5-10 per cent and well below the external benchmark figure of 12 per cent. CASA is continuing to monitor whether these rates represent an appropriate level of staff turnover for CASA.

Stakeholder relationships

Aviation Safety Forum

The Aviation Safety Forum is a consultative body, which advises CASA on strategic issues associated with regulation of the aviation industry and on certain aspects of CASA's operations. This advice may be sought by CASA or put forward by the Forum itself.

The Aviation Safety Forum is broadly representative of stakeholders in the aviation community. Members provide expert input based on their extensive backgrounds in passenger transport, engineering, general aviation, aviation consumer issues and as

officers of Airservices Australia and the Department of Defence.

The Department of Transport and Regional Services sends an observer to meetings.

Membership of the Aviation Safety Forum was expanded in 2004-2005 to bring in new expertise and fresh insights including governance and strategic guidance.

The Aviation Safety Forum met four times in 2004-05.

Some of the key issues the Forum addressed and advised CASA or the Minister on during the reporting period were:

® development of CASA's Corporate Plan

® CASA's cost recovery and long-term funding arrangements

® The CASA audit programme

® The CASA Aviation Safety programme; and

® The consistency and quality of regulatory decisions undertaken by CASA.

Further information about the ASF (including its membership, sub-committees, meeting agendas and reports) is provided on CASA's web site at www.casa.gov.au

Robyn Beetham, Adrian Verkerk and Rob Graham have joined the group of 15 people which meets at least four times a year to advise CASA on strategic issues.

Robyn joins the forum having held positions such as Assistant Secretary, Aviation Industry Branch and First Assistant Secretary, Aviation Division in the Department of Transport and Regional Services.

She also held senior positions in agriculture and rail, and several positions on national transport-related advisory committees, including the Aviation Y2K Committee, the Aviation Industry Forum and the Global Navigation Satellite System Consultative Committee.

As well as being a member of the Aviation Safety Forum, Robyn is also on the Weapons Material Governance board which advises the Department of Defence on project governance issues.

She is also a member of the Safeskies board and Chair of the ACT and Southern NSW section of the Chartered Institute of Logistics and Transport. Robyn comes to the ASF with a keen interest in regulatory development based on efficient and effective outcomes.

Adrian Verkerk is Head of Engineering and Maintenance for Qantas Airlines, and is responsible for fleet management and airworthiness matters, as well as holding the position of Maintenance Controller.

After graduating from Sydney University with a degree in aeronautical engineering, Adrian spent 10 years in the design office of Hawker de Havilland Australia, working on a wide range of mechanical systems projects for military aircraft.

He joined Qantas in 1988 and since then has worked in various engineering roles, progressing from mechanical systems, powerplant engineering, maintenance contracts management, technical training management and airworthiness compliance to his current position.

Rob Graham trained as a pilot in the United Kingdom before coming to Australia and working in air traffic control for the Department of Civil Aviation in the 1970s.

He retired as Director of Safety and Environment in 1998, before moving to New Zealand and taking on the role of General Manager, Personnel Licensing and Aviation Services for the New Zealand Civil Aviation Authority.

Rob returned to Australia to become Director of Safety Investigation for the Australian Transport Safety Bureau until he retired in 2004, and retains a major interest in safety management systems and regulatory issues.

C A S A A n n u a l R e p o r t 2 0 0 4 - 2 0 0 5

Corporate report

Standards Consultative Committee (SCC)

The SCC brings together representatives from a diverse range of aviation industry groups to work with CASA on regulatory change. With 35 organisations represented on the main committee and a combined total of 300 CASA and industry participants in the SCC and its nine sub-committees, the commitment, effort and coordination of the process represents a significant achievement.

The SCC's principal task is to consider safety regulatory issues in relation to the Civil Aviation Safety Regulations (1998) (CASRs), amendments to the Civil Aviation Regulations (1988) (CARs) and Civil Aviation Orders (CAOs), Manuals of Standards (MOS) and Advisory Circulars (ACs).

The SCC also considers legislative change proposals to recommend to CASA which proposals should be advanced and the priority attached to each proposal. Further, the SCC identifies individual industry experts to work with CASA staff on the development of regulatory proposals.

CASA wishes to acknowledge the value of consultation with the aviation industry in its regulatory development process through the Standards Consultative Committee and its Sub-Committees. Both CASA and the aviation industry have much to gain through the engagement of technically competent, well experienced and diversely qualified personnel. This enables CASA to deliver aviation safety regulations which are contemporary and practical, reflect industry best practice; and are capable of responding to industry future directions.

With 40 aviation industry organisations represented on the main committee and a combined total of over 300 CASA and aviation industry personnel involved in the SCC and its Sub-Committees - the commitment, effort and coordination of the consultative process represents a significant achievement. Each representative organisation on the SCC or individual represented on the Sub-Committees has the opportunity to:

® Contribute information, ideas, experience and expertise;

® Challenge and debate ideas and approaches;

® Work towards agreed positions with the safety regulator;

® Advance interests where appropriate and feasible;

® Gain an understanding of the bigger picture; and

® Network with peers to promote cross-sector understanding.

Through the regulatory development process, the common goal of both CASA and the aviation industry is to develop aviation rules and supporting material which enables a safe and efficient aviation system. This helps CASA to achieve its vision of 'Safe Skies for all' and to ensure the diverse yet significant needs of each industry sector are recognised and respected during the rule making process. Above all else, CASA s regulatory material must achieve 'safety through clarity1.

SCO’s objective

The objectives of the SCC is to;

® consider regulatory proposals that have been submitted to the SCC by CASA with a view to deciding whether a proposal is worthy of consideration and, if so, recommend a level of priority that should be placed on the regulatory work associated with the proposal.

® through the aviation industry members of the SCC, identify individual industry experts to work with CASA staff on the development of regulatory proposals which are accepted as elements of the Aviation Safety Standards development programme.

The SCC has additional roles such as:

‘Information source’

The SCC is an aviation industry source of information to CASA. Through the SCC, the aviation industry informs CASA on activities which have an impact on industry and its safety outcomes. For example it informs CASA of the industry's activities and assists CASA's regulatory development through the 'Path to better aviation

rules' consultation process.

General Issues ‘Feedback forum’

The SCC serves as a forum for consultation over a broad range of issues relating to CASA's responsibilities. The SCC provides an avenue for industry to voice its perceptions, in a general sense, with Australia's civil aviation legislation, as well as generic issues associated with CASA's compliance, enforcement or regulatory

services matters. The SCC provides recommendations to CASA on standards development and regulatory reform program implementation activities. The SCC makes recommendations to CASA that arise through SCC and Sub-Committee activities. The SCC also provides input to and endorses the work of special working groups that are established to achieve particular activities, such as work on CEO Directives. The SCC receives feedback from CASA on how it has

managed those recommendations so that the decision making process is open, transparent and accountable.

‘Co-ordinator and issues resolution forum’

The SCC provides the authority and reporting line for decisions arising from its Sub-Committees. The SCC establishes related processes and procedures for the Sub-Committees and provides an issues resolution forum for conflicting industry

views between Sub-Committees.

‘New ideas testing forum'

The SCC provides a forum for CASA or the aviation industry to raise and exchange new ideas, test new initiatives and discuss future developments. This enables both CASA and industry to keep abreast of industry trends and issues and commence planning for standards development or regulatory implementation activities.

‘CEO Directives’

At the request of the CASA CEO, the SCC is tasked from time to time with providing technical consideration of specific CEO Directives. The purpose of the CEO Directives is to assist the CASA CEO make strategic policy and management decisions by having specific issues examined for their appropriateness, completeness, clarity, and safety benefit.

C A S A A n n u a l R e p o r t 2 0 0 4 - 2 81

‘Guiding Principles’

Guiding Principles are the agreed principles or terms of reference for the establishment of each new CASH Part. The Guiding Principles set the policy intent, safety outcomes, stakeholders, major activities and implementation activities associated with that Part or,

in future, with other regulatory development activities. The SCC reviews and advises on each new Guiding Principles document.

Activities for 2004-05

The SCC met four times during 2004-05. Some of the key issues considered were the:

® Guiding Principles for CASR Parts 115 and 119 Subpart M;

S Appointment of aviation industry co-chairs for each Sub-Committee;

® Development of an Options Paper regarding the SCO's Future Role;

® Recommendation to CASA for a preferred parallel path for flight crew licensing;

S Various legislative amendments to CASRs, CARs (1988) and CAOs;

® Progression of activities to achieve CEO Directive 16/2004; and

® Development of a cooperative consultation plan and 'fast-track' consultation process for minor legislative changes.

The SCC also provided pre-issue review of the following consultation documents:

® Draft DP 0404OS - Fatigue Management — suggested alternatives to prescribed Flight and Duty Times

® Draft DP 0412CS - Proposal to Automatically Mandate Compliance with Airworthiness Directives issued by a State of Design

® Draft DP 0410AS - Carriage and Use of Automatic Dependent Surveillance— Broadcast (ADS-B) Avionics

® Draft DP 0408CS - Concept of fitting tamper resistant time recording devices to helicopters

® Draft NPC 65/01 - Proposed Amendments to Manual of Standards (MOS) Part 65 — Air Traffic Services Licensing and Training Requirements

® Draft NPC 172/01 - Proposed amendments to the Manual of Standards (MOS) for Part 172 — Air Traffic Service Providers

® Draft NPRM 0403OS - Disclosure of Personal Information

® Draft NPRM 0407MS - Maintenance and Maintenance Personnel Requirements

® Draft NPRM 04090S - Air Transport Operations - Small Aeroplanes - CASR Part 135

® Draft NPRM 0406AS - Aeronautical Telecommunication Service and Radionavigation Service Providers

® Draft NPRM 0411 MS - CASR Part 119M - Airworthiness and Maintenance Requirements

® Draft NPRM 0502CS - Proposed AD for Replacement of control cables

Further Information

Further information about the SCC (including its membership, Sub-Committees, meetings and activities) is provided on CASA's web site at http://rrp.casa.gov. au/scc/

Sub-Committee Reports

Airspace Users Group

The Airspace Users Group met once in 2004-05. Sub-Committee activities included:

® Discussion on access for sport aviation aircraft to Class E airspace;

<§> Consideration of draft Advisory Circular 139-09(0) - Aerodrome safety inspections at registered and certain other aerodromes;

® Review of the draft Notice of Final Rule Making (NFRM) to Notice of Proposed Rule Making (NRRM) 0406AS - Aeronautical Telecommunication Service and Radionavigation Service Providers;

® Review of draft Notice of Proposed Change NPC 172/01 - Proposed Amendments to Manual of Standards (MOS) Part 172 - Air Traffic Service Providers;

® CASR Part 65 - Post Implementation Review

® Consideration of CEO Directive 16/2004

® Review of draft Discussion Paper DP 0410AS - Carriage and use of Automatic Dependent Surveillance - Broadcast (ADS-B) Avionics - CASR Parts 71,91,101 and 103.

Certification Standards Sub-Committee

The Certification Standards Sub-Committee met on one occasion in 2004-05. Sub-Committee activities included:

® Undertaking CEO Directive 16/2004 reviews for CASR Part 146 and 21 .H Airworthiness requirements for light sport aircraft.

® Consideration of Airworthiness Directives issued by a State of Design.

® The selection of an aviation industry Sub-Committee co-chair.

Flight Crew Licensing Standards Sub-Committee

The Flight Crew Licensing Standards Sub-Committee met on three occasions in 2004-05. Sub-Committee activities included:

® CEO Directive 16/2004 reviews for CASR Parts 61 and 141.

® Consideration of parallel path proposals for flight crew licensing.

® The selection of an aviation industry Sub-Committee co-chair.

C A S A A n n u a l R e p o r t 2 0 0 4 - 2 0 0 5 83

Corporate report

Operational Standards Sub-Committee

The Operational Standards Sub-Committee met on two occasions in 2004-05. Sub­ committee activities included:

® CEO Directive 16/2004 Working Group reviews for CASR Parts 91, 133 & 135.

® Consideration of Airworthiness Directives issued by a State of Design.

® Consideration of draft NPRM 04090S - Air Transport Operations - Small Aeroplanes - CASR Part 135

® The post-implementation review of CASR Part 101 - Unmanned aircraft and rocket operations.

® Draft DP 04040S - Fatigue Management — suggested alternatives to prescribed Flight and Duty Times.

® The selection of an aviation industry Sub-Committee co-chair.

Maintenance Standards Sub-Committee

The Maintenance Standards Sub-Committee met on five occasions in 2004-05. Sub­ Committee activities included:

® CEO Directive 16/2004 reviews for CASR Parts 43, 66, 145, 147 and 183 and CASR Subparts M for 91, 121, 133A& 135.

® The review of Guiding Principles for the maintenance regulations.

® The review of proposed amendments to CASR Part 45 - Nationality and registration marks.

® The selection of an aviation industry Sub-Committee co-chair.

® Draft DP 0412CS - Proposal to Automatically Mandate Compliance with Airworthiness Directives issued by a State of Design

® Draft DP 0408CS - Concept of fitting tamper resistant time recording devices to helicopters.

® Draft NPRM 0411 MS - CASR Part 119M - Airworthiness and Maintenance Requirements.

® The selection of an aviation industry Sub-Committee co-chair.

Recreational Aviation Standards Sub-Committee

The Recreational Aviation Standards Sub-Committee met on four occasions in 2004-05. Sub-Committee activities included:

® CEO Directive 16/2004 reviews for CASR Parts 103 & 105.

® The consideration of Guiding Principles for CASR Parts 115 & 149.

® The development of drafting instructions for CASR Part 149.

® The selection of an aviation industry Sub-Committee co-chair.

® Consideration of parallel path proposals for flight crew licensing.

CASA Hotline

In 2004-05 there were 232 calls to the CASA Hotline, which was set up to give people straightforward and confidential access to CASA about aviation safety concerns. Many of these calls came from people working in the industry who wanted to bring to light troubling practices relating to flight and duty rostering, maintenance, reporting of incidents and defects, validity of licences and so on. Others came from members of the public who wished to raise concerns about low and dangerous flying, and to report incidents that occurred on flights upon which they were travelling. The Hotline is an extremely valuable source of safety intelligence for CASA and CASA makes every effort to ensure that all concerns raised are promptly addressed.

Corporate Communications

CASA is strongly committed to maintaining and improving effective communication with the aviation industry, the travelling public and its staff.

In the past year, relationships with the Australian and international media have been further improved, ensuring information on aviation safety is quickly and accurately delivered as required. During the reporting period, a total of nine

hundred and fourty media stories about CASA were monitored. From these stories, negative comment about aviation safety and CASA itself in the Australian media was measured and shown to be continuously low - averaging just under four per cent of all media analysed.

CASA continues to respond in a timely fashion to requests from people in the aviation industry for information. A dedicated email address for enquiries receives dozens of requests each week and responses are prepared daily.

Communication with staff remains one of CASA's highest priorities, and during the reporting period, a review of CASA's internal communications strategy was completed to ensure that our communication strategies meet the needs of CASA

and its staff.

During the year, the Chief Executive Officer made a series of visits to CASA's Area and Airline Office network. These visits gave staff the opportunity to meet him and to discuss their work, aviation issues, ideas and concerns and also provide ongoing feedback to the Chief Executive Officer and Chief Operating Officer on the 'Building a New CASA' series of reforms. These visits will continue in

2005-06.

In addition, the Chief Executive Officer and key members of the CASA Senior Management Group attended a series of Industry Consultation Forums. During the reporting period, these Forums were held in Cairns,Townsville, Perth, Darwin, Adelaide and Bankstown. These forums will continue in 2005-06.

C A S A A n n u a l R e p o r t 2 0 0 4 - 2 0 0 5 85

Corporate report

A meeting held in Adelaide during the reporting period recently gave CASA representatives the opportunity to liaise with local industry members, and opened the floor for those members to raise their concerns and questions.

Bill Riceman, Central Area manager, reported that around 25 industry people attended the meeting, reflecting the diversity of the aviation industry in the region.

"They included the chief executive officer of BAE Systems Flight Training (Australia), which is the largest flying school in the country and the general manager of Tenix Aviation, which is a large maintenance organisation," Bill says.

"We also had present a representative from National Air Support at one end of the scale, and CEOs and general managers from small charter operators and maintenance organisations at the other end."

CASA's Chief Operating Officer Bruce Gemmell opened the meeting and was followed by Bill who outlined the function of the local Compliance division area office and introduced the staff.

Jim Marcolin, acting general manager, General Aviation Operations, spoke about the management system model and the responsibility that company managers have in ensuring safety of their operations.

There were also presentations from Reg Perkins, acting general manager, Regulatory Services, on the work of the Regulatory Services branch and Regulatory Reform Program implementation, and Nicola Hinder, acting executive manager, Corporate Affairs, who discussed CASA's complaints and compliments handling process.

"There were opportunities for questions throughout, and a panel discussion to answer questions from the floor on any topic raised. Acting executive manager, Compliance, Arthur White, ended the meeting with closing remarks," says Bill.

"Overall the feedback from the people who attended was good. They appreciated the opportunity to hear from, and to speak directly to senior CASA staff, as well as to meet some of the local CASA staff in a social context in the area office."

International relations

Australia is a signatory to the Convention on International Civil Aviation (the Chicago Convention), which provides for the safe and orderly development of international civil aviation.

The International Civil Aviation Organization (ICAO), which was established by the Convention, develops international Standards and Recommended Practices using international panels and working groups. These Standards and Recommended Practices are published in eighteen annexes to the Convention.

The Transport and Regional Services portfolio has carriage of Australia's participation in ICAO, with the various agencies taking responsibility for ICAO activities falling within their legislative functions. CASA is responsible for seven of the eighteen annexes, and shares responsibility for a further two annexes with Airservices Australia.

In 2004-05 CASA continued to provide strong support to ICAO, although resource constraints continue to require a detailed prioritisation of that support to ensure maximum benefit from reduced funds. In recognition of these constraints, CASA conducted a review of its International Relations strategies, and consideration is currently being given to the outcome of this review with a view to making recommendations for implementation early in 2005-2006.

S

See page 182 for information about significant contributions made to ICAO's work during the year.

Bilateral arrangements

CASA continues to work towards bilateral arrangements with various partner States. Notably, during 2004-05, the former Deputy Prime Minister and Minister for Transport and Regional Services, the Hon John Anderson MP signed the Executive Agreement to a Bilateral Aviation Safety Agreement (BASA) with the

United States of America.

M r David Fetter,: First Secretary (Economics), United States Embassy, M r William Stanton,

Charges d'Affaire Ad-Interim, United States Embassy and the Hon John Anderson MP, Former

Deputy Prime M inister and M inister for Transport and Regional Services

In addition to the work undertaken to complete the Executive Agreement to the Bilateral Aviation Safety Agreement, significant work was undertaken by CASA, the Department of Transport and Regional Services, the Department of Foreign Affairs and Trade and the Attorney General's Department on the Implementation

Procedures for Airworthiness (I PA) which accompany the BASA. The I PA is the first treaty-level procedure negotiated under the BASA and sets out the detailed technical processes which the Civil Aviation Safety Authority and the United States Federal Aviation Administration (FAA) will undertake in certifying, approving and overseeing a range of activities covering airworthiness, including design approvals, production activities, export airworthiness approvals and technical assistance between authorities.

This set of procedures will benefit and promote Australia's aviation exports to the United States, because Australian manufacturers' products will be certified and approved by CASA and recognised by the FAA. This is a significant portfolio and Australian achievement. It is expected that the I PA will be signed by the Minister for Transport and Regional Services, The Hon Warren Truss MP early in the 2005­ 2006 reporting period.

CASA continues to work with the United Kingdom Civil Aviation Authority on an agreement relating to aircraft below 450 kgs. The assumption of certification responsibility for other aircraft by the European Aviation Safety Agency (EASA) has negated the value of future individual national agreements and therefore

CASA has commenced discussions with EASA with the intention of negotiating an agreement that will cover all EASA countries. This matter will be progressed by CASA, and its portfolio partners during 2005-06.

C A S A A n n u a l R e p o r t 2 0 0 4 - 2 0 0 5

Trans-Tasman relations

As part of a larger government direction, CASA continues to work closely with the New Zealand Civil Aviation Authority to put in place technical procedures and systems that will allow respective airlines to operate domestically in either country with the minimum of additional certification. Such procedures will maintain the high standards of aviation safety required of airlines by the relevant safety regulator.

This process is complemented by the work undertaken by the Australian Department of Transport and Regional Services and the New Zealand Ministry of Transport to provide a policy framework appropriate for these operations.

Regional activities

Throughout the year, CASA remained active in the Pacific region with the provision of substantial support to assist in the establishment of the Pacific Aviation Safety Office (PASO).

Following discussions with the Department of Transport and Regional Services (DOTARS), it was agreed that DOTARS would provide Australian representation on the PASO Council of Directors as of August 2005. CASA will provide advice and assistance to the Australian Representative in relation to the aviation safety technical issues which

PASO Is likely to face as it becomes operational.

Systems and processes

CASA Improvement Program

The CASA Improvement Program is a major program to deliver improved business processes and systems to give CASA the capabilities it requires to support the CASA High Level Business Model. CASA formed an alliance contract with Accenture Australia

Holdings Pty Limited (Accenture) to undertake the work. Accenture's services are provided under a performance-based risk-reward arrangement.

The Discovery Stage of the program was completed in May 2002 and the Foundation Stage began in July 2002. In 2004, CASA reviewed the scope and cost of the CASA Improvement Program. The program's primary focus will now be on replacing CASA's

principal legacy regulatory system (LARP) with the Foundation stage budget reduced from $34.5m to $32.6m. This will be achieved by providing a single release of the Aviation Industry Regulatory System (AIRS), including the original Phase 1 and 2 projects.

During 2004-05:

® building upon the Core Architecture completed in 2004, phase 1 functionality for the new CASA System (AIRS), incorporating aviation industry individual participants and their licences (based on the new CASR Parts 61, 64 and 66), has been built and integration tested

@ > phase 2 functionality, which incorporates aviation industry organisation participants, their certificates and the aircraft register has also been built

<§> conversion routines from CASA's previous information source 'LARP' to CASA's refined Information Tcehnology System 'AIRS'

® AIRS interfaces to other CASA regulatory systems have been built.

AIRS remains on track for implementation in September 2005.

Quality management

The Quality System Certification CASA achieved for its Service Centre in 2002-03 was validated during the year. A third party audit conducted in November 2004 found no instances of non-conformance with ISO 9001:2000.

Contracting arrangements

Following an open tender process IPEX ITG (a division of Volante Group Limited) was engaged on 26 June 2000 to provide information technology and telecommunications services. The original contract was for five years with the option for two two-year extensions. During 2003-04 CASA exercised options extending the contract to June 2009 and also changed its supplier arrangements for telephony services during that period.

C A S A A n n u a l R e p o r t 2 0 0 4 - 2 0 0 5 8!

Part 4

Accountability and External Scrutiny

C A S A Annual Report 2004-2005

Accountability to the Minister

Following the legislative changes to CASA's Governance structure in 2003, CASA's rolling three-year corporate plan is now formally subject to the Minister's approval. CASA's Corporate Plan for 2005-06 to 2006-07 was submitted to the Minister in June 2005 and has been approved. A copy of the 2005-06 to 2006-07 Corporate Plan is available on the CASA website at www.casa.gov.au. In addition, this Annual Report is a key component of CASA's accountability and reporting requirements to the Minister.

CASA’s 2003-2004 Annual Report a Winner!

CASA's Annual Report for the 2003-2004 reporting period, was selected by the Institute of Public Administration Australia (ACT Division) as a Gold Award winner.

The 2003/04 Annual Reports of Commonwealth Agencies reporting under the Commonwealth Authorities and Companies Act 1997 (the CAC Act) were assessed by the Institute of Public Administration Australia (ACT Division) against both formal reporting requirements of CAC Act entities and contemporary good practices in annual reporting.

Twenty tw o (22) annual reports were assessed, including both statutory authorities and Commonwealth companies.

The judges report for the 2003-2004 awards states that 'Reports that appear to comment honestly on any challenges and under-achievements against targets during the year received favourable consideration from the judges. CASA was an example of this...'

CASA was also named one of only four commonwealth agencies or departments to win a bronze medal in the Australasian Reporting Awards for the 2003/2004 reporting

period.

The awards recognise excellence in annual reporting as assessed against demanding Australasian Reporting Awards criteria.

Awards vice-chairman Arthur Delbridge reported that all gold, silver and bronze winners this year had one thing in common - respect for readers and a synergy in the elements of good communication in reporting: text, tables, graphs and other visuals.

Mr Rob Collins and Ms Nicola Hinder attended the Australasian Reporting Awards for the 2003/2004 reporting period ceremony and received the award on CASA's behalf.

Parliamentary oversight

Committee hearings

CASA appeared before the Senate Rural and Regional Affairs and Transport Committee's consideration of Budget Estimates in November 2004, February 2005 and May 2005. Details of CASA's attendance at these hearings can be found on the Australian Parliament House website at www.aph.gov.au

Parliamentary questions

During 2004-05 CASA provided timely information for responses to 37 Parliamentary questions placed on notice and a further 58 questions arising from Senate Estimate hearings.

Disallowances

No CASA instruments that were subject to Parliamentary disallowance were disallowed by either House of Parliament during 2004-05.

Complaints and Investigations

Commonwealth Ombudsman

There was a decrease over the previous year in the number of complaints relating to CASA received by the Office of the Commonwealth Ombudsman.

Ombudsman inquiries, 2004-05

Complaints received by the Ombudsman 1

Complaints finalised 1

Issues investigated by the Ombudsman 2

Finding of defective administration resulting from investigation 2 Exercise of discretion by the Ombudsman not to investigate issues 1 Referral of complaints back to CASA________________________________0

Internal Ombudsman

CASA has an internal ombudsman panel to which the Chief Executive Officer may refer serious allegations of impropriety to ensure full and independent investigation. There were no such referrals in 2004-05.

Complaints mechanism

In response to the Minister's Charter Letter, CASA reviewed and re-issued the Service Charter during the 2003-2004 reporting period. This Service Charter will be reviewed for ongoing applicability during 2005-2006.

To ensure transparency, management and reporting of complaints and compliments is now undertaken at a senior manager level and the Office of the Chief Executive Officer reviews CASA's response.

C A S A A n n u a l R e p o r t 2 0 0 4 - 2 0 0 5 93

The Melbourne Airline office, CASA officer Allen Henderson and the CASA Service Centre have all recently been on the receiving end of industry feedback via the Complaints and Compliments link on the CASA website.

And the good news is, it's all positive.

A correspondent requiring complicated amendments to their Certificate of Approval submitted the following comments online:

",Just a note to let the wider CASA organisation know that the work o f Alien Henderson from the Melbourne Airline office is greatly appreciated.

"Due to business realignments... we had to transfer approval o f our operations from our Certificate o f Approval to come under the Certificate o f Approval already issued in a different business name.

"This also meant that we transferred from administration by the Victoria / Tasmania Area office to the Melbourne Airline office.

"To minimise disruption to our business and our flying customers, this had to be done as quickly as possible.

"Approving the operations o f [the business's1 separate activities on the one Certificate o f Approval is a little different to what has been done previously, and Allen provided excellent service and support in working through the various issues.

"No doubt he had assistance from others whose input is unknown to me. I would like to record my appreciation o f all CASA staff involved with this transfer and particularly recognise the efforts o f Allen Henderson."

During the reporting period, the introduction of new forms and procedures designed to make the process of issuing, varying or renewing Air Operator's Certificates and Certificates of Approval much easier for industry and CASA staff was released.

Feedback received from a Queensland operator through the CASA website Complaints and Compliments link shows the Service Centre is meeting those goals:

" We are writing to comment on our very recent experience with CASA concerning changing our Operations Manual on our current AOC. The staff at the CASA Service Centre have been excellent in helping us to understand what we need to do to implement this change.

"We have spoken to numerous staff and they are all very helpful. We have been given a form 1214 (parts A and C) to fill out and we were glad to complete it with great ease and understanding o f it.

''[W ei would like to comment on how easy, self-explanatory and sensible these forms have been to fill out.

"To make adjustments to our AOC has always been a daunting thing to do. We would like to thank CASA for making this adjustment a lot less worrying through the CASA Service Centre and those form s."

Australian Transport Safety Bureau (ATSB)

The ATSB is charged with improving transport safety by investigating transport accidents and incidents and using its findings to promote change through safety action statements and recommendations. During 2004-05, the ATSB made five recommendations to CASA arising from its investigations.

Table 1 Coronial Inquiries 2001-02 to 2004-05

Inquiries on hand from the previous year 2 5 1 3

New inquiries 3 1 3 1

Total 5 6 4 4

Conclusions handed down 2 5 2 3

Inquiries remaining in progress at 30 June 3 1 2 1

Total 5 6 4 4

Review of CASA’s regulatory decisions

Table 2: Administrative Appeals Tribunal - merits review (a) of regulatory decisions (b) 2001-02 to 2003-04

Applications on hand from the previous year 12 17 16 15

Applications lodged during the year 27 17 19 18

Total 39 34 32 33

Matters dealt with (c)

Decisions affirmed 4 5 3 2

Decisions varied 0 1 1 0

Decisions set aside 3 2 2 1

Matter dismissed 3 1 2 2

Sub-total 10 9 8 5

Status of other matters

Applications withdrawn by the applicant 12 9 8 10

Applications remaining on hand at 30 June 17 16 16 18

Sub-total 29 25 24 28

Total 39 34 32 33

a) Merit review involves the reconsideration of an administrative decision. On the facts before it the Administrative Appeals Tribunal decides whether the correct, or in a discretionary area, the preferable decision has been made in accordance with the applicable law.

b) The types of CASA regulatory decisions that can be appealed to the Administrative Appeals Tribunal are listed on the AAT web site at:

. c) Does not include interlocutory decisions, that is, decisions made during the progress of an action.

Table 3: Categories of CASA decisions that were appealed to the Administrative Appeal Tribunal

Refusal to issue 0

Issue subject to conditions not sought by applicant for the authorisation 0 Cancellation/Suspension 2

Variation/imposition of conditions not sought by holder_________________________0

Refusal to issue 1

Issue subject to conditions not sought by applicant for the authorisation 0 Cancellation/Suspension 2

Variation/imposition of conditions not sought by holder 0

Refusal to issue 3

Issue subject to conditions not sought by applicant for the authorisation 2 Cancellation/Suspension 0

Variation/imposition of conditions not sought by holder 1

Refusal to issue 0

Issue subject to conditions not sought by applicant for the authorisation 0 Cancellation/Suspension 4

Variation/imposition of conditions not sought by holder 2

Refusal to issue 0

Issue subject to conditions not sought by applicant for the authorisation 0 Cancellation/Suspension 0

Variation/imposition of conditions not sought by holder 0

Refusal to issue 0

Issue subject to conditions not sought by applicant for the authorisation 0 Cancellation/Suspension 0

Variation/imposition of conditions not sought by holder 0

Refusal to issue 1

Issue subject to conditions not sought by applicant for the authorisation 0 Cancellation/Suspension 2

Variation/imposition of conditions not sought by holder 1

Issue of a Banner Towing Permit Subject to conditions not sought by applicant for permit

Total

< § >

Table 4: Federal Court - applications for judicial review (a) of regulatory decisions, 2001-02 to 2004—05

■ ■ ■ ■Matters with the CourtApplications on hand from the previous year 3 0 2 0 0 0Applications filed during the year 3 0 2 1 1 2Total 6 0 4 1 1 2Matters dealt withDecisions affirmed Decisions set aside/overturned Matters dismissed Sub-totalStatus of other matters0 0 00 0 03 0 23 0 20000Proceedings discontinued 1 0 2 1 0Applications on hand 2 0 0 0 1Sub-total 3 0 2 1 1Total 6 0 4 1 1Decisions arising from AAT decision 2 0 4 1 10222 0 2004-05

Filed by Filed by

subject CASA

person (b)

1 1

4 1

5 2

0 0

1 1

1 0

2 1

1 0

2 1

3 1

5 2

1 0

a) 'Judicial' review by the Federal Court is based on questions of law and is directed to the legality rather than the merits of a decision,

b) A person who is the subject of a CASA decision may apply direct to the Federal Court under the Administrative Decisions (Judicial Review) Act 1977 for review or, having first appealed to the Administrative Appeals

Tribunal, may appeal the decision made by the Administrative Appeals Tribunal.

Federal Court Prohibition Orders

Under the enforcement provisions that came into effect on 21 February 2003, CASA may suspend a civil aviation authorisation for five business days without issuing a show cause notice where there is a serious and imminent safety risk. Such suspensions then end unless CASA applies to the Federal Court for a prohibition order before that five-day period expires.

CASA made one application to the Federal Court for an order, in May 2004.

Two CASA staff members from the Northern Territory and Kimberley Area office were recognised by CASA for their professionalism while working under extreme conditions.

Early in the reporting period, John Beasy, Flying Operations Inspector, and Tom Forrest, airworthiness inspector, attended a Northern Territory property in response to a complaint from neighbours concerning the operations of a helicopter.

From L to R: Tom Forrest, Doug Whitfield

the office mascot and John Beasy.

John and Tom attended the property where the helicopter was being kept and met with people who can best be described as 'cowboys'. The officers were intimidated with the presence of ringers handling firearms,

John and Tom inspected the helicopter and documentation under extreme duress, but handled themselves with total professionalism. They had to return later that day to serve notices and conduct a further inspection, and again nearly a week later to investigate further claims.

Despite the intimidation, they carried out their duties without fear or favour. The inspectors obtained enough evidence and took detailed notes to allow a successful investigation to be carried out, which led to both administrative and prosecution action against the owner/pilot of the helicopter and prosecution action against the

property owner.

Despite the hardships and intimidation endured by John and Tom, they treated the identified persons with respect, explained the reasons for their visit and their powers under the law to carry out their duties and conducted themselves with total professionalism.

All of their actions were scrutinised in court and despite intense cross examination, the magistrate even commented on the professionalism of the officers concerned.

The prosecution action against the property owner concluded in December 2004. He was convicted and fined at the Darwin Court of Summary Jurisdiction for failing to allow Tom and John access to the helicopter on their last visit to the premises.

Table 5: Freedom of information, 2001-02 to 2004-05

Requests on hand from the previous year 5 5 5 10

New requests received 90 53 62 76

Total 95 58 67 86

Matters decided

Access granted in full 45 24 37 34

Access granted in part 13 8 5 23

Access refused (a) 22 14 12 11

Sub-total 80 46 54 68

Status of other matters

Requests withdrawn by applicant 8 6 2 8

Requested transferred in whole to another agency 2 1 1 0

Requests remaining on hand at 30 June 5 5 10 10

Sub-total 15 12 13 18

Total 95 58 67 86

a) Includes matters where the reason for refusal was that the document(s) did not exist.

Table 6: Tim e taken to m ake d ecisio n s on freedom o f in form a tion m atters

· ■ a

■0-30 days 73 91 43 93 50 93 55 8131-60 days 7 9 3 7 3 5 13 1961-90 days 0 0 0 0 0 0 0 0More than 90 0days0 0 01200Total 80 100 46 100 54 100 68 100Table 7: Internal CASA review of freedom of information decisionsMatters on handNew applications received 4 5 2 7Total 4 5 2 7Matters decidedDecisions upheld 1 2 0 2Greater access given 2 3 2 3Charges increased 1 0 0 0Charges reduced 0 0 0 0Sub-total 4 5 2 5Status of other mattersApplications withdrawn 0 0 0 0Applications remaining on hand at 30 June 0 0 0 2Sub-total 0 0 0 2Total 4 5 2 7c C A S A A n n u a l R e p o r t 2 0 0 4 - 2 99

Administrative Review Tribunal review of freedom of information decisions

There were no applications to the Administrative Appeals Tribunal for review of CASA decisions under the Freedom of Information Act in the past four years (2001-02 to

2004-05).

Other review

Office of Regulation Review

CASA has built into its standards development process the regulatory best practice recommendations contained in the Guide to Regulation published by the ORR, which is charged with promoting the Government's objective of effective and efficient legislation

and regulations.

In 2004-05 CASA achieved total compliance with RIS requirements with the ORR accepting all RISs submitted by CASA as meeting Government requirements and found that an adequate level of analysis has been provided, including assessments of the

possible cost impact to industry.

t - .

Part 5

Statutory Reporting Requirements

CASA Annual Report 2004-2005 101

Statutory reporting of significant events

Under section 15 of the Commonwealth Authorities and Companies A ct 1997, CASA must notify the Minister of significant events.

These are defined as any proposal to:

S form a company or participate in the formation of a company

® participate in a significant partnership, trust, unincorporated joint venture or similar arrangement

(§> acquire or dispose of a significant shareholding in a company

® acquire or dispose of a significant business

® commence or cease a significant business activity, or

make a significant change in the nature or extent of its interest in a significant partnership, trust, unincorporated joint venture or similar arrangement.

There were no significant events within the meaning of section 15 during 2004-05.

Other major events

Under the Commonwealth Authorities and Companies Orders 2002, CASA must report on any significant changes in accordance with:

® subclause 10(1 )(e) - significant changes in the authority's state of affairs or principal activities that have occurred during the financial year; and

®> subclause 10(1 )(f) - developments since the end of the financial year, giving particulars of any matter or circumstance that has arisen and has significantly affected or may significantly affect:

- the results of those operations in future years or

- the Authority's state of affairs in future financial years.

The following significant changes and developments have occurred:

The planned introduction o f Cost Recovery:

The Australian Government adopted a formal cost recovery policy in 2002 that focuses on the direction government agencies should take to improve the consistency, transparency and accountability of Australian Government cost recovery arrangements, and promote the efficient allocation of resources.

CASA's changes to cost recovery arrangements will commence from 1 January 2006. CASA's functions under the Civil Aviation Act 1988 include the provision of regulatory services to the aviation industry and CASA currently has some limited cost recovery arrangements in place for these regulatory services. Twelve different services are specified under the Civil Aviation (Fees) Regulations 1995 and fees are charged at either a fixed rate for particular services, or at an hourly rate based on the number of hours taken to provide the service. These services are charged across a range of segments in the aviation industry, but predominantly to licence and certificate holders.

The LTFS includes a significant consultation and communications programme for industry. To ensure adequate time is dedicated to the consultation process, the cost recovery implementation programme will be phased in over three years.

Possible impacts o f the Uhrig report:

During the reporting period, in line with the outcomes of a report commissioned by the Commonwealth on issues such as governance, financial management and reporting of various government agencies, including CASA, information was provided to the Secretary of the Department of Transport and Regional Services to assist in the consideration of this matter. At the time of reporting, no decisions

have been made on whether CASA will adopt the recommendations contained within the report.

Significant judicial decisions and administrative review decisions

Under the Commonwealth Authorities and Companies Orders 2002, CASA must report, in accordance with subclause 11(a), on any judicial decisions and decisions of administrative tribunals that have had, or may have, a significant impact on its operations.

In the reporting period, there were two judicial decisions and judicial decisions of administrative tribunals that have had, or may have, a significant impact on CASA's operations.

Sydney Heliscenic Pty Ltd v CASA

Claim for breach of contract by CASA relating to undertakings ostensibly given by CASA in the course of regulatory action against the plaintiff.

The NSW District Court held that CASA had entered into a contract with the plaintiff in relation to the exercise of its safety regulatory powers, and awarded the plaintiff $100,000 in damages. The decision has significant ramifications for CASA, and potentially regulators and other statutory decision-makers in other fields.

In essence, it equates CASA’s discussions with regulated entities regarding enforcement decisions with contract negotiations, and imposes a commercial overlay on what are essentially regulatory decisions made in the public interest. CASA believes the formation of a contract in such circumstances is contrary to established legal principles, and has appealed the decision to the NSW Supreme Court.

CASA v Boatman and Kennedy

A series of inter-related actions in the Federal Court and Full Federal Court arising from the first application of CASA's power to suspend a civil aviation authorisation for a serious and imminent risk to air safety under Division 3A of Part III of the Civil Aviation Act 1988.

The actions have clarified some aspects of the operation of Division 3A, although significantly the Federal Court is still to give reasons for its decision that the respondents had not engaged in conduct which constituted a serious and imminent risk to air safety.

CASA is awaiting the Court's reasons, and hopes that those reasons will provide some guidance on the meaning of "serious and imminent risk" in the legislation. Depending on those reasons, CASA may appeal against the Federal Court's decision.

- A S A A n n u a l R e p o r t 2 0 0 4 - 2 103

Freedom of Information Act

The Freedom o f Information Act 1982 (FOI Act) requires Australian Government agencies to make available information about their organisation, functions and operations, and about rules and practices used in making decisions which affect members of the public.

Section 8 of the FOI Act requires each agency to publish detailed information about the following:

® the way the agency is organised

t§> powers of the agency

® types of decisions made by the agency

® arrangements for public involvement in the work of the agency

® the way in which members of the public may obtain access to relevant documents.

This functional statement is published to meet the requirements of section 8 of the FOI Act. Further information on the organisation, as well as the powers and functions of CASA is at Part 1 and Part 3 of this report.

Establishment o f CASA

CASA was established on 6 July 1995 by an amendment to the Civil Aviation Act 1988.

Organisation

The organisation chart published on page13 shows the structure of the organisation.

Functions and powers

Section 9 of the Civil Aviation Act 1988 provides that CASA has the function of conducting the safety regulation of civil air operations in Australian territory and the operation of Australian aircraft outside Australian territory in accordance with the Civil Aviation Act 1988and regulations made under the Act. CASA also has other safety related functions, including encouraging a greater acceptance by the aviation industry of its obligation to maintain high standards of aviation safety.

Freedom o f inform ation procedures and contact point

Under section 15 of the Freedom of Information Act, any person is entitled to apply for access to documents that fall within the scope of the Act. A request under the Freedom of Information Act should be in writing, accompanied by a $30 application fee and stating an address in Australia to which notices under the Act can be sent. In certain circumstances the fee is not required or can be remitted.

For a quick response, give as much information as possible about the document/s sought. It is advisable also to include a telephone number in case clarification is necessary,

<§)

Requests under the Freedom of Information Act for access to documents in CASA's possession should be directed to:

Freedom of Information Coordinator

Legal Services Group Civil Aviation Safety Authority GRO Box 2005 Canberra ACT 2601

Telephone: (02) 6217 1606 Facsimile: (02) 6217 1607

Email: freedominformation@casa.gov.au

Enquiries may be directed to the Freedom of Information Coordinator as shown above.

The Coordinator can help applicants identify particular documents being sought.

Facilities for access

Facilities for inspection of documents, and preparation of copies if required, are provided or arranged by the Freedom of Information Coordinator.

Arrangements for outside participation

Subsection 9(2) of the Civil Aviation Act 1988 provides that one of CASA's functions is to promote full and effective consultation and communication with all interested parties on aviation safety issues.

Section 16 of the Act provides that in the performance of its functions and the exercise of its powers, CASA must, where appropriate, consult with government, commercial, industrial, consumer and other relevant bodies and organisations (including ICAO and bodies representing the aviation industry).

The Aviation Safety Forum is a special consultative body helping the aviation community and CASA work effectively together to improve aviation safety in Australia. The Aviation Safety Forum advises CASA on important strategic issues (see page 78).

The CASA Standards Consultative Committee is a joint CASA-industry forum, set up to involve the aviation industry formally during the development phase of regulatory material. The committee brings together CASA staff and representatives from a diverse range of aviation industry organisations to work jointly during the development phase of regulatory material. The committee examines proposed regulatory changes to determine if they are worth pursuing and helps CASA allocate priorities to those projects (see page 80).

CASA complies with government requirements in relation to preparing Regulation Impact Statements. As part of this process, CASA issues NPRMs in relation to any significant changes to Civil Aviation Orders and Regulations made under the Civil Aviation Act 1988.

C A S A A n n u a l R e p o r t 2 0 0 4 - 2 0 0 5 105

Categories o f Documents

The categories of documents (including internal administration papers and records, working drafts, statistical records, copies of emails, telexes, cables and facsimiles) that CASA holds include:

® human and financial resource management records

® ministerial, inter-agency and general correspondence and papers

® policy documents including recommendations and decisions, media releases and position papers

® papers relating to new and amended legislation, draft instructions and draft legislation

® briefing papers and submissions prepared for the Chief Executive Officer and Director of Aviation Safety, Deputy Chief Executive Officer and Chief Operating Officer, members of the Senior Management Group and the previous CASA Board

® papers and records relating to certification, registration, manufacture, maintenance and operation of aircraft

® papers and records relating to licensing of flight crew, maintenance staff and certification of air service operators and organisations involved in aviation activities

® papers and records relating to licensing, maintenance and operation of aerodromes papers and records relating to development of aviation safety standards

® papers and records relating to aviation safety education

® documents relating to aviation industry surveillance.

Section 9 statement

In accordance with section 9 of the FOI Act, CASA maintains a list of manuals and other documents that CASA officers use as a guide to procedures and practices to be followed when making decisions or recommendations that affect the public.

CASA officers use the following documents in making decisions or recommendations under, or for the purpose of, the Civil Aviation Act 1988.

(NB Documents marked with one asterisk (*) are available from the CASA web site; those with two (**) are also available as part of the CASA CD-ROM Library, # indicates documents that may also be purchased in hardcopy from JS McMillan at http://casa. jsmcmillan.com.au.

For further information contact:

Document Control Officer Civil Aviation Safety Authority GPO Box 2005 Canberra City ACT 2601

Telephone: 131 757 (local call) Email: feedback@casa.gov.au

(§)

i> Aerodrome Rescue and Fire Fighting Service Procedures** #

® Aeronautical Telecommunication and Radionavigation Service Providers Entry Control Procedures Manual** #

® Aircraft Maintenance Engineers Invigilators Handbook

® Air Displays: Safety and Administrative Arrangements**#

® Air Transport Pilot (Aeroplane Aeronautical Knowledge Syllabus)*

® Air Transport Pilot (Helicopter) Licence Aeronautical Knowledge Syllabus*

® Air Transport Pilot Licence (Helicopter) Examination Information Book*

® Airworthiness Directives Procedures Manual** #

® Aircraft Maintenance Engineer Licensing Procedures Manual** #

® Air Operator Certification Manual** #

® Air Traffic Service Training Providers - Entry Control Procedure Manual**#

® Air Traffic Service Providers Entry Control Procedures Manual ** #

® Air Traffic Service Licensing Manual**#

® Authorised Engineering Representatives Procedures Manual *

® Aviation Rulings *

® Aviation Safety Occurrence Manual** #

® Commercial Pilot Balloon Syllabus of Training*

® Carriers' Liability Insurance Compliance Procedures Manual *

® CASA CD-ROM Library

® CASA Policy Notices *

® CEO Directives *

® Certificates of Airworthiness and Special Flight Permits** #

® Certificates of Approval Procedures Manual** #

® Compliance Management Instructions

® Day (Visual Flight Rule) Syllabus Aeroplanes* #

® Day VFR Syllabus (Helicopters)* #

® Designated Medical Examiners Handbook** #

® Enforcement Manual**

® Exemptions and Variations Manual

® Flight Crew Licensing Manual** #

C A S A A n n u a l R e p o r t 2 0 0 4 - 2 0 107

® Flight Crew Licensing Industry Delegates Handbook**#

® Industry Delegates and Authorised Persons Management Manual**#

® Manual of Controlled Documents

® Manual of Operational Standards (MOS)** #

® MOS Part 60 Synthetic Training Devices**#

® MOS Part 65, Standards Applicable to Air Traffic Services Licensing and Training Requirements**#

® MOS Part 139 Aerodromes**#

® MOS Part 139H, Standards Applicable to the Provision of Aerodrome Rescue Fire Fighting Services* *#

® MOS Part 143, Air Traffic Services Training Providers* *#

® MOS Part 171, Aeronautical Telecommunication and Radionavigation Services* *#

® MOS Part 172, Air Traffic Service Providers* *#

® MOS Part 173 Standards Applicable to Instrument Flight Procedure Design**#

® Minimum Equipment List/Permissible Unserviceable Procedures Manual** #

® Operational Standards and Requirements Approved Synthetic Trainers (FSD-2)**

® PPL Examination Information Book - Helicopter and Aeroplane*

® Production Approval Procedures Manual** #

® Service Charter *

® Surveillance Procedures Manual

® Syllabus of Examination Aircraft Maintenance Engineer Licences Mechanical Category*

® Syllabus of Examination Aircraft Maintenance Engineer Licences Electrical, Instrument and Radio Categories*

® Syllabus of Training - Aircraft Radio Operator Certificate of Proficiency*

® Standards Development and Rule Making Manual** #

® Traffic Alert and Collision Avoidance System (TCAS II) Competency Standards for CAS II Operations and Aeronautical Knowledge Syllabus of Training*

® The Australian Air Transport Pilot Licence (Aeroplane) Examination Information Booklet*

® TTRMA Bulletin - AME Licensing - TTMRA Information Bulletin*

® Type Certificate Procedures Manual** #

® The Australian Air Transport Pilot Licence (Helicopter) S76 Performance and Operations Handbook*

@

Ecologically sustainable development

Under subsection 516A(3) of the Environment Protection and Biodiversity Conservation Act 1999, CASA must report on its actions and operations during the financial year in accordance with subsection 516A{6) of the Act.

Under subsection 9A(1) of the Civil Aviation Act 1988, CASA must regard the safety of air navigation as the most important consideration when exercising its powers and performing its functions. However, subject to this overriding safety obligation, CASA is also required by subsection 9A(2) to exercise its powers and perform its functions in a manner that ensures, as far as is practicable, the environment is protected from the effects:

® of the operation and use of aircraft

® associated with the operation and use of aircraft.

CASA has regard to section 9A in regulatory standards development and compliance activities, in accordance with the principles of section 3A of the Environment Protection and Biodiversity Conservation Act.

CASA is an active participant in the Australian Government's energy efficiency policy. It is this policy that drives CASA's initiatives to reduce energy consumption and, therefore, CASA's contribution to the Greenhouse Gas Emission Reduction Strategy.

In addition, CASA employs waste reduction initiatives such as waste paper recycling programs and building waste recycling programs when undertaking building fitouts and refurbishments.

During 2004-05 CASA was not involved in any actions likely to have a significant impact on matters of national environmental significance or on Commonwealth land.

Commonwealth Disability Strategy

CASA’s operations encompass the typical activities of regulator (with elements of policy adviser), service provider, employer and purchaser.

Regulator and service provider

CASA’s major focus continued to be using electronic technology, particularly the Internet, to improve the accessibility of regulatory information, regulatory services, safety promotion and participation in the regulatory reform process.

Work during 2004-05 included:

® continuing to support and promote the use of an e-shop for online product ordering and purchasing. The e-shop allows members of the aviation industry and the general public to obtain copies of safety products (including videos, CDs, posters and publications), and purchase maintenance forms, manuals and other CASA documents;

® the amalgamation of the regulatory reform web site to the CASA main website to bring together all regulatory reform, and other CASA material in a more easily accessible way. With respect to specific issues of regulatory reform, the web

site has direct links to online response forms, providing an electronic alternative to the freefax, freepost and email methods of submitting comments to CASA on public consultation documents;

<§) Continuous improvement to the online response system for members of the aviation industry and the general public to submit comments on consultative documents, such as Notices of Proposed Rule Making, Discussion Papers and Notices of Proposed Change;

<8> The promotion of a new web site to give AOC and COA applicants better guidance on making an application. The new section sets out (in one location, with all necessary links) the steps for application and assessment, the forms required, the supporting documentation needed, legislative requirements, CASA fees, contacts and other helpful information;

S providing the application forms for AOC variations and subsequent issues to applicants complete with the information CASA already holds on them;

Φ creating an online one-stop-shop of information for air traffic controllers to make it easy for them to check the regulations, find forms, and apply for and renew licences and ratings; and

φ adding further manuals and other documents to regulatory information provided online.

Employer

CASA's recruitment policy ensures its recruitment advertising does not dissuade people with disabilities who have the necessary experience, skills and qualifications from submitting applications. The policy also ensures selection processes take into account the special needs of applicants so that those with disabilities are not disadvantaged.

CASA's 'Building Standards and Performance Requirements for Civil Aviation Safety Authority (CASA) Leased Premises' require access for the disabled to be provided to buildings and to all areas of offices in accordance with Australian Standard AS 1428.

In addition, CASA provides disabled car parking to staff who are suffering from either permanent or temporary disability. In the case of temporary disability, parking is provided for the duration of a period recommended by a medical practitioner.

CASA's standard office desks and chairs are ergonomically designed to meet Australian Standard AS 4443 and Australasian Furniture Research and Development Institute standards.

Special chairs are provided to staff who have particular anatomical differences or who suffer from conditions that make the standard chair unsuitable.

CASA also provides, as needed, suitable IT equipment and/or software to aid staff with disabilities. Contractual arrangements with CASA's IT service provider require support and maintenance of all occupational health and safety and disability assistance equipment associated with desktop computers.

Support through the Help Desk can be tailored for staff with special needs by noting an alert for Help Desk staff against the user's name.

CASA will also provide appropriate voice facilities, such as TTY telephones, to any staff

member who may need them.

In purchasing furniture, equipment and software to meet special needs, CASA consults with the staff concerned and will seek the advice of relevant organisations, as appropriate.

Purchaser

CASA's procurement policies reflect those of the Commonwealth in general and comply with all Commonwealth policies and directives relating to anti­ discrimination.

Occupational health and safety

Further to the overview of activities provided on page 72, the following information about occupational health and safety is provided in accordance with the requirements of section 74 of the Occupational Health and Safety (Commonwealth Employment) Act 1991.

Occupational health and safety policy

CASA's current occupational health and safety (OH&S) policies were reviewed in the reporting period to make OH&S more strategic. A new policy, strategy and agreement have been implemented to bring these documents into line with the

requirements of an OH&S management system that identifies, assesses and controls OH&S risks.

Establishment o f committees to deal w ith occupational health and safety

CASA has in place 16 Designated Work Groups.

These are as follows:

New South Wales

® Kingsford Smith Airport Office, Mascot

® Bankstown Airport Office

® NSW Country Office, Tamworth Annex

Victoria

f> Melbourne Office

® Moorabbin Office

Queensland

® Service Centre, Bowen Hills

® Hendra Office

® Townsville Office

® Cairns Office

Western Australia

® Perth Office

South Australia

® Adelaide Office

Northern Territory

® Darwin Office

Australian Capital Territory

® Novell House

® CASA Building

® NSW Country Office

® Canberra Annex Sverdrup House

Selection of health and safety representatives

Each Designated Work Group listed above has in place a Health and Safety Representative, Deputy and CASA nominee.

Measures taken to ensure the health, safety and welfare at work o f employees and contractors

CASA examined the findings and recommendations from the major Job Safety Analysis of the Aviation Safety Compliance Division undertaken in 2002-03 and began an implementation process during 2003-2004 to address the recommendations. This work continued in 2004-2005 with the development of a Personal Protective Equipment framework drafted during the reporting period.

In addition, CASA's current occupational health and safety (OH&S) policies were reviewed in the reporting period to make OH&S more strategic. A new policy and strategy have been implemented to bring these documents into line with the requirements of an OH&S management system that identifies, assesses and controls OH&S risks.

Accidents or dangerous occurrences during the year

There were no notifiable accidents or dangerous occurrences during 2004-05 that arose out of the conduct of undertakings by CASA and that required the giving of notice under section 68 of the Occupational Health and Safety (Commonwealth Employment) Act 1991,

Investigations conducted during the year that relate to undertakings carried on by the employer

In 2004-05 there were no official investigations conducted and no Provisional Improvement Notices issued.

Insurance and indemnities

The following information about CASA's Commonwealth and commercial indemnities and insurances is provided in accordance with clause 16 of the Commonwealth Authorities and Companies (Report of Operations) Orders 2002.

Nevertheless, the Commonwealth remains obliged to indemnify CASA in relation to liabilities associated with acts or omissions that occurred before the date of expiry.

Under a Deed of Agreement, CASA was indemnified against claims incurred in carrying out its responsibilities for aviation safety regulation.

This indemnity was subject to an annual renewal on payment of an annual premium by CASA to the Commonwealth. This indemnity expired on 5 July 1998.

An indemnity was given to those officers of CASA who administered the carriers' liability insurance requirements under Part iVA of the Civil Aviation (Carriers' Liability) Act (959 and complementary State legislation. This indemnity was revoked with effect from 29 August 1998.

In December 1999, the Commonwealth provided a deed of indemnity to CASA Board members. This indemnity expired on 30 June 2002. The CASA Board ceased to exist on 21 October 2003, upon commencement of the Civil Aviation Amendment Act 2003.

Current commercial indemnity and insurance arrangements.

In 2004-05 CASA held aviation and general liability, professional indemnity, directors and officers liability insurance, and a range of other corporate insurance. The general scope of this coverage is outlined below.

Aviation and general liability

Aviation and general liability insurance provides coverage for injuries caused to third parties or to the property of third parties, as a result of negligence arising out of the performance of CASA's functions under the Civil Aviation Act, the Civil Aviation (Carriers' Liability) Act and other applicable legislation, and for which indemnity by the Commonwealth of Australia does not apply.

Professional indemnity

CASA's professional indemnity coverage applies in respect of claims arising from breaches of duty by CASA officers generally involving the provision of skilled services or advice.

Directors' and officers' liability

CASA held insurance protecting directors and officers from liability for the consequences of managerial misconduct or negligence, to the extent the provision of this indemnity is not prevented by applicable legislation.

C A S A A n n u a l R e p o r t 2 0 0 4 - 2 0 0 5

Competitive tendering and contracting

Following an open tender process IPEX ITG (a division of Volante Group Limited) was engaged on 26 June 2000 to provide information technology and telecommunications services. The original contract was for five years with the option for tw o two-year extensions. During 2003-04 CASA exercised options extending the contract to June 2009.

Advertising and market research

In accordance with amendments to the Commonwealth Electoral Act 1918, all Commonwealth departments and authorities are required to set out, in their annual reports, details of amounts paid by or on behalf of them during the year to advertising agencies, market research organisations, media advertising organisations and direct mail organisations.

In 2004-05 CASA paid the amounts detailed in Tables 8, 9 and 10.

Table 8: Media costs, 2004-05

AAP Information Services Pty Ltd ..................$12,361

Alpha Multimedia - CarbonS Pty Ltd $46,310

Asylum Industries P/L- Universal Fusion $7,229

Australian Picture $2,105

Australia-Pacific Aviation Services P/L $22,500

Aviation Theory Centre $7,000

Bearcage Productions - Bearcage Media $7,490

Brendon Davis $1,000

Chesterfield Trad. Trust - Lindbush P/L $1,832

CreSive Multimedia $19,157

CSIRO $6,509

Department of Parliamentary Services $5,330

Filmday Pty Limited $10,858

Fivefold Creative - The Hatherly $9,500

Geoff Comfort Photographer $2,980

Getty Images Inc $7,479

Ice Media Pty Ltd $19,830

James Alexander Ostinga $15,975

Jaymac Promotional $3,667

John Kempton $1,600

John Mulcair $5,603

JS Mcmillan Pty Ltd $1,587

JSA Design Pty Ltd $3,016

JSA Digital Pty Ltd $22,028

Juanita Franzi -T/AAero Illustrations $15,160

Table 8: Media costs, 2004-05 (continued)

Kandream Digital Studios P/L $1,632

Macarthur Job $7,238

Martin B Aubury $2,260

Media Monitors Australia Pty Ltd $35,424

Media Technology Pty Ltd $72,190

Michael J Smith $4,385

On Hold Professionals $2,545

Paul Phelan $1,888

Rob Fox T/A Fox51 Photography $1,510

Robert Lee And Sue Burdekin Pty Ltd $3,665

Sabdent Pty Ltd $2,672

Skye Group Pty Ltd $15,575

Styles & Styles Pty Ltd $5,909

Wilson Media Pty Ltd $7,624

Total Media Costs $422,623

Note: Excludes GST. Expenditure relates to amounts over $1,500.

Table 9: Direct mail costs, 2004-05

Aerial Agriculture Association Of Australia $1,616

Australia Post $446,880

Australian Air Express Pty Ltd $23,548

Australian National Couriers $4,924

Croff Commercial Services $1,968

DHL International Pty Ltd $1,568

Inprint Pty Ltd $2,200

Lane Print Group - Lane Laser Printers $2,939

Morgans Corner $3,015

Qprint $5,973

Spring $4,925

TNT Australia Pty Ltd $104,949

Universal Express Courier Service $8,073

Total Direct Mail Costs $612,578

Note: Excludes GST. Expenditure relates to amounts over $1,500.

C A S A A n n u a l R e p o r t 2 0 0 4 - 2 115

Table 10: Advertising costs, 2004-05

Adelaide Advertiser $1,788

Attorney General's Department $32,995

Australian Aviation $2,643

Aviation Trader $5,397

Classic Wings Downunder Ltd $1,700

Cre8ive Multimedia $4,182

HMA Blaze Pty Ltd $84,473

Image 7 Group Pty Ltd $1,960

TMP Worldwide Pty Ltd $13,044

Workplace Research Associates Pty Ltd $2,430

Total Advertising Costs $150,612

Note: Excludes GST. Expenditure relates to amounts over $1,500.

CASA addresses

CENTRAL OFFICE

CASA Building Cnr Northbourne Avenue and Barry Drive Canberra ACT 2600

PO Box 2005 Canberra Fax: 02 6217 1209

ACT 2601 Email: feedback@casa.

AIRLINE OFFICES

Canberra

CASA Building Cnr Northbourne Avenue and Barry Drive General Manager Canberra ACT 2600 Ph: 131 757 (local call) or 02 6217 1181

PO Box 2005 Fax: 02 6217 1500

Canberra ACT 2601 Email: airlineops@casa.gov.au

Sydney

Building 235 Cnr Qantas Dr and Robey St Manager

Mascot NSW 2020

Ph: 131 757 (local call) or 02 9366 3101

PO Box 409 Fax: 02 9366 3111

Mascot NSW 1460 Email: sydneyairlines@casa.gov.au

Melbourne

Level 11, 505 Little Collins Street Manager

Melbourne Vic 3000

Ph: 131 757 (local call) or 03 9927 5319

PO Box 558 Fax: 03 9927 5336

Collins Street West Vic 8007 Email: melbairlines2@casa.gov.au

Brisbane

39 Navigator Place Manager

Hendra Brisbane Old 4011

Ph: 131 757 (local call) or 07 3632 4054 Fax: 07 3632 4080 Email: brisbaneairlines@casa.gov.au

AREA OFFICES

Sydney Basin

Building 628 Airport Avenue Bankstown Airport Area Manager

Sydney NSW 2200

Ph: 131 757 (local call) or 02 9780 3050

PO Box CP57 Fax: 02 9780 3045

Condell Park NSW 2200 Email: sydneybasin@casa.gov.au

C A S A A n n u a l R e p o r t 2 0 0 4 - 2

AREA OFFICES continued

NSW Country Canberra annex:

Cnr Nomad Drive and Rayner Road Canberra Airport Pialligo ACT 2609

GPO Box 2005 Canberra ACT 2601

Tamworth annex:

Cnr Rentell St and Basil Brown Drive Tamworth Airport NSW 2340

PO Box 895 Tamworth NSW 2340

Victoria and Tasmania

19 Second Avenue Moorabbin Airport Mentone Vic 3194

PO Box 20 Cheltenham Vic 3192

South Queensland

39 Navigator Place Hendra Old 4011

North Queensland Townsville Office:

1 Coral Sea Drive Townsville Airport Qld 4814

PO Box 7740 Garbutt Qld 4814

Cairns Office:

Building 78 Mick Borzi Drive Cairns International Airport Cairns Qld 4870

PO Box 280N North Cairns Qld 4870

Area Manager

Ph: 131 757 (local call) or 02 6217 1751 Fax: 02 6217 1319 Email: nswcountry@casa.gov.au

Ph: 131 757 (local call) or 02 6755 2245 Fax: 02 6755 2240 Email: nswcountry@casa.gov.au

Area Manager

Ph: 131 757 (local call) or 03 9518 2750 Fax: 03 9518 2792 Email: victasmail@casa.gov.au

Area Manager

Ph: 131 757 (local call) or 07 3632 4053 Fax: 07 3632 4050 Email: southqld@casa.gov.au

Area Manager

Ph: 131 757 (local call) or 07 4750 2671 Fax: 07 4750 2662 Email: northqld@casa.gov.au

Area Manager

Ph: 131 757 (local call) or 07 4042 3603 Fax: 07 4042 3600 Email: northqld@casa.gov.au

AREA OFFICES continued

Western Australia

130 Fauntleroy Ave Perth Airport WA 6104

GRO Box 1082 Cloverdale WA 6105

Central

4 Kel Barclay Avenue Adelaide Airport SA 5950

PO Box 126 PBC Adelaide Airport SA 5950

Northern Territory and Kimberley

Reservations House 3 Cecil Cook Ave Darwin Airport Marrara NT 0812

PO Box41196 Casuarina NT 0811

SERVICE CENTRE

Level 2, Building 2, Citilink Building 153 Campbell Street Bowen Hills OLD 4006

PO Box 836 Fortitude Valley OLD 4006

Area Manager

Ph: 131 757 (local call) or 08 9366 2800 Fax: 08 9366 2810 Email: west@casa.gov.au

Area Manager

Ph: 131 757 (local call) or 08 8422 2921 Fax: 08 8422 2900 Email: central@casa.gov.au

Area Manager

Ph: 131 757 (local call) or 08 8943 2999 Fax: 08 8943 2986 Email: nt@casa.gov.au

Ph: 136 773 Fax: 07 3842 2580 Email: regservices@casa.gov.au

C A S A A n n u a l R e p o r t 2 0 0 4 - 2 119

Part 6

Financial Statements

ASA Annual Report 2004-2005 121

Financial Statements

Australian National

Audit Office

INDEPENDENT AUDIT REPORT

To the Minister for Transport and Regional Services

Scone

The financial statements comprise:

• Statement by the Chief Executive Officer and Chief Financial Controller;

• Statements o f Financial Performance, Financial Position and Cash Flows;

• Schedules o f Commitments, Contingencies; and

• Notes to and forming part o f the Financial Statements

o f the Civil Aviation and Safety Authority for the year ended 30 June 2005.

The Chief Executive Officer is responsible for preparing the financial statements that give a true and fair view o f the financial position and performance of the Civil Aviation and Safety Authority, and that comply with accounting standards, other mandatory financial reporting requirements in Australia, and the Finance Minister’s Orders made under the Commonwealth Authorities and Companies Act 1997. The Chief Executive Officer is also responsible for the maintenance of adequate accounting records and internal controls that are designed to prevent and detect fraud and error, and for the accounting policies and accounting estimates inherent in the financial statements.

Audit approach

I have conducted an independent audit of the financial statements in order to express an opinion on them to you. My audit has been conducted in accordance with the Australian National Audit Office Auditing Standards, which incorporate the Australian Auditing and Assurance Standards, in order to provide reasonable assurance as to whether the financial statements are free o f material misstatement. The nature o f an audit is influenced by factors such as the use o f professional judgement, selective testing, the inherent limitations of internal control, and the availability o f persuasive, rather than conclusive, evidence. Therefore, an audit cannot guarantee that all material misstatements have been detected.

While the effectiveness o f management’s internal controls over financial reporting was considered when determining the nature and extent o f audit procedures, the audit was not designed to provide assurance on internal controls.

GPO Bo* 707 CANBERRA ACT 2601 Centenary House 19 National Circuit BARTON ACT Phone (02) 6203 7300 Fax (02) 6203 7777

I have performed procedures to assess whether, in all material respects, the financial statements present fairly, in accordance with the Finance Minister’s Orders made under the Commonwealth Authorities and Companies Act 1997, including accounting standards and other mandatory financial reporting requirements in Australia, a view which is consistent with my understanding o f the Authority’s financial position, and of its performance as represented by the statements of financial performance and cash flows.

The audit opinion is formed on the basis of these procedures, which included:

• examining, on a test basis, information to provide evidence supporting the amounts and disclosures in the financial statements; and • assessing the appropriateness of the accounting policies and disclosures used, and the reasonableness of significant accounting estimates made by the Chief Executive

Officer.

Independence

In conducting the audit, I have followed the independence requirements of the Australian National Audit Office, which incorporate the ethical requirements of the Australian accounting profession.

Audit Opinion

In my opinion, the financial statements of the Civil Aviation and Safety Authority:

(a) have been prepared in accordance with the Finance Minister’s Orders made under the Commonwealth Authorities and Companies Act 1997; and (b) give a true and fair view of the Civil Aviation and Safety Authority’s financial position as at 30 June 2005 and of its performance and cash flows for the year then

ended, in accordance with:

(i) the matters required by the Finance Minister’s Orders; and (ii) applicable accounting standards and other mandatory financial reporting requirements in Australia.

Australian National Audit Office

Richard Rundle Executive Director

Delegate o f the Auditor-General

Canberra 30 August 2005

Financial Statements

Statement by Chief Executive and Chief Financial Controller In our opinion, the attached financial statements for the year 30 June 2005 have been prepared based on properly maintained financial records and give a true and fair view of the matters required by the Finance Minister’s Orders made under the Commonwealth Authorities and Companies Act 1997.

In our opinion, at the date of this statement, there are reasonable grounds to believe that the Authority will be able to pay its debts as and when they become due and payable

/ f

Λ August 2005

Betty Edwards

Chief Financial Controller

August 2005

( § )

CIVIL AVIATION SAFETY AUTHORITY STATEMENT OF FINANCIAL PERFORMANCE For the year ended 30 June 2005

REVENUE

Revenues from ordinary activities

Revenue from Government 5A 49,039 45,599

Aviation fuel excise SB 64,477 60,420

Regulatory service fees 5C 4,897 3,203

Interest 5D 1,292 934

Revenue from sale of assets 5E 283 334

Other 5F 2,840 369

Revenues from ordinary activities 122,827 110,859

EXPENSE

Expenses from ordinary activities (excluding borrowing costs expense)

Employees 6A 69,143 66,908

Suppliers 6B 35,266 34,954

Depreciation and amortisation 6C 5,434 4,588

Write-down and impairment of assets 6D 120 40

Value of assets sold 5E 201 331

Expenses from ordinary activities (excluding borrowing costs expense) 110,166 106,821

Borrowing costs expense 7 122 46

Operating surplus from ordinary activities 12,539 3,992

Net surplus 12,539 3,992

Net credit to asset revaluation reserve 13 1,074 -

Total revenues, expenses and valuation adjustments recognised directly in equity 1,074

Total changes in equity other than those resulting from transactions with the Australian Government as owner 13,613 3,992

The above statement should be read in conjunction with the accompanying notes.

Financial Statements

STATEMENT OF FINANCIAL POSITION as at 30 June 2005

ASSETS

Financial Assets

Cash 14B, 21 25,975 18,811

Receivables 8A, 21 1,220 727

Accrued Revenue 8B, 21 1,441 1,031

Total financial assets 28,636 20,569

Non-financial assets

Land and buildings 9A,C 2,195 2,066

Infrastructure, plant and equipment 9B,C 8,752 8,484

Intangibles 9D 22,293 14,499

Other non-financial assets 9E 663 700

Total non-financial assets 33,903 25,749

Total assets 62,539 46,318

LIABILITIES

Interest bearing liabilities

Leases 10, 21B 1,848 805

Total interest bearing liabilities 1,848 805

Provisions

Employees 11A 19,298 19,539

Other provisions 11B 721 660

Total provisions 20,019 20,199

Payables

Suppliers 12A, 21 7,008 5,595

Other payables 12B, 21 499 167

Total payables 7,507 5,762

Total liabilities 29,374 26,766

NET ASSETS 33,165 19,552

( § >

STATEMENT OF FINANCIAL POSITION (continued) as at 30 June 2005

EQUITY

Contributed equity 13 2,150 2,150

Reserves 13 2,425 1,352

Accumulated profits 13 28,590 16,050

Total equity 13 33,165 19,552

Current assets 29,299 21,269

Non-current assets 33,240 25,049

Current liabilities 16,201 15,284

Non-current liabilities 13,173 11,482

The above statement should be read in conjunction with the accompanying notes.

Financial Statements

CIVIL AVIATION SAFETY AUTHORITY

STATEMENT OF CASH FLOWS

for the year ended 30 June 2005

Operating Activities

Cash Received

Appropriations 49,039 45,599

Receipts from excise 64,046 61,064

Receipts from customers 8,058 3,948

Interest 1,250 959

GST Recovered from ATO 4,641 4,235

Total Cash Received 127,034 115,805

Cash Used

Employees (69,117) (66,252)

Suppliers (39,910) (38,419)

Borrowing costs - (46)

Total Cash Used (109,027) (104,717)

Net Cash From / (Used by) Operating Activities 14A 18,007 11,088

Investing Activities

Cash Received

Proceeds from sales of property, plant and equipment 283 334

Total Cash Received 283 334

Cash Used

Purchase of property, plant and equipment (10,504) (11,136)

Total Cash Used (10,504) (11,136)

Net Cash From / (Used By) Investing Activities (10,221) (10,802)

Financing Activities

Cash Received

Appropriations - Contributed equity 120

Total Cash Received - 120

CIVIL AVIATION SAFETY AUTHORITY

STATEMENT OF CASH FLOWS (continued)

for the year ended 30 June 2005

Financing Activities continued

Cash Used

Finance Lease (622) (921)

Total Cash Used (622) (921)

Net Cash From Financing Activities

=

(622) (801)

Net Increase/ (Decrease) in Cash Held 7,164 (515)

Cash at the beginning of the reporting period 18,811 19,326

Cash at the End o f the Reporting Period 14B 25,975 18,811

The above statement should be read in conjunction with the accompanying notes.

C A S A A n n u a l R e p o r t 2 0 0 4 - 2 129

Financial Statements

CIVIL AVIATION SAFETY AUTHORITY

SCHEDULE OF COMMITMENTS

as at 30 June 2005

By Type

Other Commitments

Operating leases 1 39,155 26,527

Other commitments 2 5,989 6,169

Total Other Commitments 45,144 32,696

Commitments receivable 4,104 2,972

Net Commitments by Type

=

41,040 29,724

By Maturity

Operating Lease Commitments

One year or less 9,258 9,546

From one to five years 23,255 12,206

Over five years 6,642 4,775

Total Operating Lease Commitments 39,155 26,527

Other Commitments

One year or less 5,989 6,169

From one to five years - -

Over five years - -

Total Other Commitments 5,989 6,169

Commitments Receivable 4,104 2,972

Net Commitments by Maturity

=

41,040 29,724

NB: Commitments are GST inclusive where relevant.

1 Operating leases included are effectively non-cancellable and comprise:

Lease for office accomodation Lease payments may be subject to annual increase with upward movements in Consumer Price Index and/or Market Review.

The initial period of office accomodation leases (majority) are still current and each may be renewed for up to 5 years at CASA’s option, following a once-off adjustment of rentals to current market levels.

CIVIL AVIATION SAFETY AUTHORITY

SCHEDULE OF COMMITMENTS

as at 30 June 2005

Nature of Lease General Description of Leasing Arrangements

Lease for provision of information technology infrastructure Lease is in relation to provision of information technology infrastructure, excluding Desktop Workstations, Portable Laptops

and Network Printers.

Volante Pty Ltd meets the majority of CASA’s computer equipment and software requirements under the provisions of the Group 8 Services Agreement for an initial period of 5 years ending 30 June 2005 (to be extended by 2x2 years at CASA’s option). CASA

retained the right under the Service Agreement to source IT&T equipment from other suppliers if deemed appropriate. To date such purchases have been minor.

In conjunction with all other Group 8 agencies, CASA has exercised its options to extend its information technology Agreement with Volante Pty Ltd. The term of this extension is for another 2 x 2 years ending on 25 June 2009.

2 As at 30 June 2005, other commitments are primarily contracts for acquisition and configuration of commercial software for new business processes and systems.

The above schedule should be read in conjunction with the accompanying notes.

1 1 11." C A S A A n n u a l R e p o r t 2 0 0.4 - 2 1

2004 $’000

Financial Statements

CIVIL AVIATION SAFETY AUTHORITY NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS for the year ended 30 June 2005

Note 1

Note 2

Note 3

Note 4

Note 5

Note 6

Note 7

Note 8

Note 9

Note 10

Note 11

Note 12

Note 13

Note 14

Note 15

Note 16

Note 17

Note 18

Note 19

Note 20

Note 21

Note 22

Note 23

Summary of Significant Accounting Policies

Adoption of Australian Equivalents to International Financial Reporting Standards from 2005-06

Economic Dependency

Events Occurring After Reporting Date

Operating Revenues

Operating Expenses

Borrowing Costs Expense

Financial Assets

Non-Financial Assets

Interest Bearing Liabilities

Provisions

Payables

Analysis of Equity

Cash Flow Reconciliation

Contingent Liabilities and Assets

Director Remuneration

Related Party Disclosures

Remuneration of Officers

Remuneration of Auditors

Average Staffing Levels

Financial Instruments

Appropriations

Reporting of Outcomes

Financial Statements

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

1.1 Basis of Accounting

The financial statements are required by clause 1 (b) of Schedule 1 to the Commonwealth Authorities and Companies Act 1997and are a general purpose financial report.

The statements have been prepared in accordance with:

• Finance Minister's Orders (being the Commonwealth Authorities and Companies Orders (Financial Statements for reporting periods ending on or after 30 June 2005))]

• Australian Accounting Standards and Accounting Interpretations issued by the Australian Accounting Standards Board; and

• Urgent Issues Group Abstracts.

CASA's Statements of Financial Performance and Financial Position have been prepared on an accrual basis and are in accordance with historical cost convention, except for certain assets, which, as noted, are at valuation. Except where stated, no allowance is made for the effect of changing prices on the results or the financial position.

Assets and liabilities are recognised in CASA's Statement of Financial Position when and only when it is probable that future economic benefits will flow and the amounts of the assets or liabilities can be reliably measured. Assets and liabilities arising under agreements equally proportionately unperformed are, however, not recognised unless required by an accounting standard. Liabilities and assets that are unrecognised are reported in the Schedule of Commitments and the Schedule of Contingencies (other than unquantifiable or remote contingencies, which are reported at Note 15).

Revenues and expenses are recognised in CASA's Statement of Financial Performance when and only when the flow or consumption or loss of economic benefits has occurred and can be reliably measured.

1.2 Revenue

The revenues described in this Note are revenues relating to the core operating activities of CASA.

Revenue from the sale of goods is recognised upon the delivery of goods to customers.

Interest revenue is recognised on a time proportionate basis that takes into account the effective yield on the relevant asset.

Revenue from disposal of non-current assets is recognised when control of the asset has passed to the buyer.

Revenue from the rendering of a service is recognised by reference to the stage of completion of the contract to provide the service. The stage of completion is determined according to the proportion that costs incurred to date bear to the estimated total costs of the transaction.

Receivables for goods and services are recognised at the nominal amounts due less any provision for bad and doubtful debts, Collectability of debts is reviewed at balance date. Provisions are made when collectability of the debt is judged to be less rather than more

likely.

Contributions of assets at no cost of acquisition or for nominal consideration are recognised as revenue at their fair value when the asset qualifies for recognition.

1.3 Transactions by the Government as Owner

Equity Injections

Amounts appropriated by the Parliament as equity injections are recognised as 'contributed equity' in accordance with the Finance Minister's Orders.

1.4 Employee Benefits

Benefits

Liabilities for services rendered by employees are recognised at the reporting date to the extent that they have not been settled.

Liabilities for wages and salaries (including non-monetary benefits), annual leave and sick leave are measured at their nominal amounts. Other employee benefits expected to be settled within 12 months of the reporting date are also measured at their nominal amounts.

The nominal amount is calculated with regard to the rates expected to be paid on settlement of the liability

All other employee benefit liabilities are measured as the present value of the estimated future cash outflows to be made in respect of services provided by employees up to the reporting date.

Leave

The liability for employee benefits includes provision for annual leave and long service leave. No provision has been made for sick leave as all sick leave is non­ vesting and the average sick leave taken in future years by employees of CASA is estimated to be less than the annual entitlement for sick leave.

The leave liabilities are calculated on the basis of employees' remuneration, including the CASA's employer superannuation contribution rates to the extent that the leave is likely to be taken during service rather than paid out on termination.

The liability for long service leave has been determined by reference to the work of an actuary as at 30 June 2004. The estimate of the present value of the liability takes into account attrition rates and pay increases through promotion and inflation.

Separation and Redundancy

Provision is made for separation and redundancy benefit payments. CASA has developed a detailed formal plan for the terminations and has informed those employees affected that it will carry out the terminations.

I R e p o r t 2 0 0 4 - 2 0 0 5 1 .

Financial Statements

Superannuation

Employees of CASA are members of a number of complying superannuation funds with the majority being members of the Commonwealth Superannuation Scheme and the Public Sector Superannuation Scheme. The liability for their superannuation benefits is recognised in the financial statements of the Australian Government and is settled by the Australian Government in due course.

CASA makes employer contributions to the Australian Government at rates determined by an actuary to be sufficient to meet the cost to the Government of the superannuation entitlements of the Authority's employees.

The liability for superannuation recognised as at 30 June 2005 represents outstanding contributions for the final fortnight of the year.

1.5 Leases

A distinction is made between finance leases and operating leases. Finance leases effectively transfer from the lessor to the lessee substantially all the risks and benefits incidental to ownership of leased non-current assets. In operating leases, the lessor effectively retains substantially all such risks and benefits.

Where a non-current asset is acquired by means of a finance lease, the asset is capitalised at the present value of minimum lease payments at the beginning of the lease term and a liability recognised at the same time and for the same amount. The

discount rate used is the interest rate implicit in the lease. Leased assets are amortised over the period of the lease. Lease payments are allocated between the principal component and the interest expense.

Operating lease payments are expensed on a basis that is representative of the pattern of benefits derived from the leased assets. The net present value of future net outlays in respect of surplus space under non-cancellable lease agreements is expensed in the period in which the space becomes surplus.

1.6 Borrowing Costs

All borrowing costs are expensed as incurred except to the extent that they are directly attributable to qualifying assets, in which case they are capitalised. The amount capitalised in a reporting period does not exceed the amounts of costs incurred in that period.

1.7 Cash

Cash means notes and coins held and any deposits held at call with a bank or financial institution. Cash is recognised at its nominal amount. Interest is credited to revenue as it accrues.

1.8 Appropriations Receivable

These receivables are recognised at the nominal amounts due.

1.9 Other Financial Assets

Debentures, term deposits and shares in listed companies are recognised at cost.

extent that the goods or services have been received (and irrespective of having been invoiced).

Interest payable is accrued overtime.

1.11 Unrecognised Financial Liabilities

Other guarantees, not recognised in the Statement of Financial Performance of CASA are disclosed in the Schedule of Contingencies. At the time of completion of the financial statements, there was no reason to believe that these guarantees would be called upon, and recognition of a liability was therefore not required.

Indemnities are disclosed in the Schedule of Contingencies at the maximum amount payable under the indemnities given. At the time of completion of the financial statements, there was no reason to believe that the indemnity would be called upon, and recognition of the liability was therefore not required. The

expected fair value of indemnities is shown in the Financial Instruments Note (Note 21 B).

1.12 Acquisition of Assets

Assets are recorded at cost on acquisition except as stated below. The cost of acquisition includes the fair value of assets transferred in exchange and liabilities undertaken.

Assets acquired at no cost, or for nominal consideration, are initially recognised as assets and revenues at their fair value at the date of acquisition, unless acquired as a consequence of restructuring of administrative arrangements In the latter case, assets are initially recognised as contributions by owners at the amounts at which they were recognised in the transferor entity's accounts immediately prior to the

restructuring.

1.13 Property (Land, Buildings and Infrastructure), Plant and Equipment

Asset Recognition Threshold

Purchases of property, plant and equipment are recognised initially at cost in the Statement of Financial Position, except for purchases costing less than $5,000, which are expensed in the year of acquisition (other than where they form part of a group of similar items which are significant in total).

Revaluations

Basis

Land, buildings, infrastructure, plant and equipment are carried at valuation. Revaluations were undertaken as at 30 June 2005.

I R e p o r t 2 0 0 4 - 2

Financial Statements

Fair values for each class of asset are determined as shown below:

Land Market selling price

Buildings Market selling price

Leasehold improvements Depreciated replacement cost

Plant and equipment Market selling price

Motor Vehicles Market selling price

Assets that are surplus to requirements are measured at their net realisable value. At 30 June 2005 CASA held no surplus assets.

Land and building assets are subject to a formal valuation every three years. Plant and equipment assets are subject to a formal valuation every four years. Formal valuations are carried out by an independent qualified valuer. Between formal valuations, property, plant and equipment assets are revalued using an appropriate index reflecting movements in the value of similar assets.

Freehold land, buildings on freehold land and leasehold improvements subject to formal valuations are each revalued progressively on a geographical basis. In between formal valuations, these assets are revalued using an appropriate index reflecting movements in the value of similar assets.

Depreciation

Depreciable property, plant and equipment assets are written-off to their estimated residual values over their estimated useful lives to CASA using, in all cases, the straight­ line method of depreciation. Leasehold improvements are depreciated on a straight-line basis over the lesser of the estimated useful life of the improvements or the unexpired period of the lease.

Depreciation rates (useful lives) and methods are reviewed at each reporting date and necessary adjustments are recognised in the current, or current and future reporting periods, as appropriate. Residual values are re-estimated for a change in prices only when assets are revalued.

Depreciation rates applying to each class of depreciable asset are based on the following useful lives:

Buildings on freehold land Life of Tenancy Life of Tenancy

Leasehold improvements Lease term Lease term

Plant and equipment 1 to 25 years 3 to 25 years

Motor Vehicles 5 years 5 years

The aggregate amount of depreciation allocated for each class of asset during the reporting period is disclosed in Note 6C.

1.14 Impairment of Non-Current Assets

Non-current assets carried at up-to-date fair value at the reporting date are not subject to impairment testing.

No non-current assets were held during the year for the purpose of generating net cash inflows. The non-current assets carried at cost, which are not held to generate net cash inflows, have been assessed for indications of impairment. Where indications of impairment exist, the asset is written down to the higher of

its net selling price and, if the entity would replace the asset's service potential, its depreciated replacement cost.

115 Intangibles

CASA's intangibles comprise internally developed software for internal use. These assets are carried at cost.

Software is amortised on a straight-line basis over its anticipated useful life. The useful life of CASA's software is 5 to 10 years (2003-04: 5 to 10 years).

All internally developed software were assessed for indications of impairment as at 30 June 2005. No impairment write down was booked for software as at 30 June 2005.

1.16 Taxation

CASA is exempt from all forms of taxation except fringe benefits tax and the goods and services tax (GST).

Revenues, expenses and assets are recognised net of GST:

• except where the amount of GST incurred is not recoverable from the Australian Taxation Office; and

• except for receivables and payables.

1.17 Insurance

CASA has insured for risks through the Government's insurable risk managed fund, called 'Comcover'. Workers' compensation is insured through Comcare Australia.

2 Adoption of Australian Equivalents to International Financial Reporting Standards (AElFRSs) from 2005-2006

The Australian Accounting Standards Board has issued replacement Australian Accounting Standards to apply from 2005-06. The new standards are the Australian Equivalents to International Financial Reporting Standards (AEIFRS). The International Financial Reporting Standards are issued by the International Accounting Standards Board. The new standards cannot be adopted early.

The standards being replaced are to be withdrawn with effect from 2005-06, but continue to apply in the meantime, including reporting periods ending on 30 June 2005.

C A S A A n n u a l R e p o r t 2 0 0 4 - 2 0 0 5

Financial Statements

The purpose of issuing AEIFRS is to enable Australian reporting entities reporting under the Corporations Act 2001 to be able to more readily access overseas capital markets by preparing their financial reports according to accounting standards more widely used overseas.

AEIFRS contain certain additional provisions that will apply to not-for-profit entities, including not-for-profit Australian Government Authorities. Some of these provisions are in conflict with IFRS, therefore CASA will only be able to assert that the financial report has been prepared in accordance with Australian Accounting Standards.

AAS 29 Financial Reporting by Government Departments will continue to apply under AEIFRS.

Accounting Standard AASB 1047 Disclosing the Impacts o f Adopting Australian Equivalents to International Financial Reporting Standards requires that the financial report for 2004-05 disclose:

® an explanation of how the transition to AEIFRS is being managed;

® narrative explanations of the key policy differences arising from the adoption of AEIFRS;

® any known or reliably estimable information about the impacts on the financial report had it been prepared using the Australian equivalents to IFRS; and

® if the impacts of the above are not known or reliably estimable, a statement to that effect.

Where an entity is not able to make a reliable estimate, or where quantitative information is not known, the entity should update the narrative disclosures of the key differences in accounting policies that are expected to arise from the adoption of AEIFRS.

The purpose of this Note is to make these disclosures.

Management o f the transition to AEIFRS

CASA has taken the following steps for the preparation towards the implementation of AEIFRS:

® CASA's Audit and Risk Committee is tasked with oversight of the transition to and implementation of AEIFRS. The Chief Financial Controller is formally responsible for the project and reports regularly to the Audit and Risk Committee on progress.

® The transition to AEIFRS involved the following key steps:

identification of all major accounting policy differences between current AASB standards and AEIFRS;

- identification and implementation of process changes necessary for reporting under AEIFRS;

- preparation of a transitional Balance Sheet as at 1 July 2004 using AEIFRS, for the information of the Audit and Risk Committee and review by the ANAO in April 2005;

- preparation of an AEIFRS compliant 2004-05 Balance Sheet; and

- reporting of the 2004-05 Balance Sheet under AEIFRS to the Department of Finance and Administration in accordance with their reporting deadlines.

Changes in accounting policies under Australian Equivalents are applied retrospectively, that is, as if the new policy had always applied except in relation to the exemptions available under AASB 1 First-time Adoption of Australian Equivalents to International Financial Fleporting Standards. This rule means that an AEIFRS compliant balance sheet was required to be prepared as at 1 July 2004. This will enable the 2005-06 financial statements to report comparatives under AEIFRS.

Changes to major accounting policies are discussed in the following paragraphs.

Management's review of the quantitative impacts of AEIFRS represents the best estimate of the impacts of the changes as at reporting date. The actual effects of the impacts of AEIFRS may differ from these estimates due to:

® continuing review of the impacts of AEIFRS on the Authority's operations;

® potential amendments to the AEIFRS and AEIFRS Interpretations; and

<§ emerging interpretation as to the accepted practice in the application of AEIFRS and the AEIFRS Interpretations.

Property, Plant and Equipment

It is expected that the 2005-06 Finance Minister's Orders will continue to require property plant and equipment assets to be valued at fair value in 2005-06.

CASA’s assets are carried at fair value, therefore no adjustments are required for compliance with AEIFRS.

Lease Make Good Asset

CASA has previously recognised a liability for lease make good commitments. AEIFRS (AASB 116 Property, Plant and Equipment) requires that CASA also recognise the lease make good asset.

CASA’s future make good obligations have been discounted at 5.78% which is the average 10 year bond rate for the period 01 January 2000 to 30 June 2004.

This change creates a leasehold improvement asset with a value of $501,000 and accumulated amortisation of $269,000, resulting in a net increase in equity of $232,000.

Impairment o f Non-Current Assets

CASA's policy on impairment of non-current assets is at Note 1.14,

Under AEIFRS these assets will be subject to assessment for impairment and, if there are indications of impairment, measurement of any impairment (impairment measurement must also be done, irrespective of any indications of impairment, for intangible assets not yet available for use). The impairment test is that the

carrying amount of an asset must not exceed the greater of (a) its fair value less costs to sell and (b) its value in use. 'Value in use' is the net present value of net cash inflows for for-profit assets of CASA and depreciated replacement cost for other assets that would be replaced if CASA were deprived of them.

An impairment assessment of CASA's non-current assets indicated that no adjustments will be required.

Financial Statements

Employee Benefits

The provision for long service leave is measured at the present value of estimated future cash outflows using market yields as at the reporting date on national government bonds.

AEIFRS also require that annual leave that is not expected to be taken within 12 months of balance date is to be discounted. After assessing the staff leave profile, CASA has discounted its non-current provision for annual leave in accordance with AASB 119 Employee Benefits. This change reduces the non-current provision for annual leave by $56,000 and increases retained earnings by $56,000.

CIVIL AVIATION SAFETY AUTHORITY

NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS for the year ended 30 June 2005

Note 2 AEIFRS Reconciliations (continued) Reconciliation o f CASA’s Equity

Total Equity under M S - 30 June 2004 - 19,552

Total Equity under AEIFRS - 1 July 2004 19,840 -

Adjustments to accumulated results 5 288

Adjustments to accumulated reserves - -

In year transactions 13,552 -

Total Equity under AEIFRS 33,397 19,840

Reconciliation o f CASA’s Operating Surplus / (Deficit)

Total Surplus / (Deficit) under M S - 30 June 2004 - 3,992

Total Surplus / (Deficit) under AEIFRS - 1 July 2004 3,992

Adjustments:

Depreciation (67) -

In Year Transactions 8,554 -

Total Surplus / (Deficit) under AEIFRS 12,479 3,992

Reconciliation o f CASA’s Reserves

Total Reserves under M S - 30 June 2004 - 1,352

Total Reserves under AEIFRS - 1 July 2004 1,352 -

Adjustment:

In Year adjustment 1,073 -

Total Reserve under AEIFRS 2,425 1,352

Reconciliation o f CASA’s Capital

Total Statutory Funds under M S - 30 June 2004 - 2,150

Total Statutory Funds under AEIFRS - 1 July 2004 2,150 -

Adjustments:

In Year adjustments - -

Total Statutory Funds under AEIFRS 2,150 2,150

Financial Statements

3 Economic Dependency

The Civil Aviation Safety Authority was established in 1995 as a statutory authority by an amendment to the Civil Aviation Act 1988.

The Authority is dependent on appropriations from the Parliament of the Commonwealth for its continued existence and ability to carry out its normal activities.

4 Events Occurring After Reporting Date

There has not been any circumstance, other than referred to elsewhere in this report, in the accounts or notes thereto, that has arisen since the end of the financial year, that has significantly affected, or may significantly affect, the Authority's operations, the result of those operations, or the Authority’s state of affairs in financial years after the financial year.

CIVIL AVIATION SAFETY AUTHORITY

NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS for the year ended 30 June 2005

Note 5: Operating Revenues

Note 5A Revenues from Government

Appropriations for outputs 49,039 45,599

Total revenues from government 49,039 45,599

Note 5B Aviation Fuel Excise

Aviation Fuel Revenues (Special Appropriation) Act 1999 64,477 60,420

Total aviation fuel excise 64,477 60,420

Note 5C Regulatory Service Fees

Civil Aviation (Fees) Regulations 1995 4,897 3,203

Total regulatory service fees 4,897 3,203

Note 5D: Interest Revenue

Cash at bank and 11am call 543 245

Investments - Bank Bill and Term Deposits 749 689

Total interest revenue 1,292 934

Note 5E Revenue from Sale of Assets

Infrastructure, plant and equipment:

Proceeds from disposal 283 334

Net book value of assets disposed (201) (303)

Write-offs - (28)

Net gain / (loss) from disposal of infrastructure, plant and equipment 82 3

Total proceeds from disposals 283 334

Total value of assets disposed (201) (331)

Total net gain from disposal of assets 82 3

Note 5F: Other Revenue

Sales of forms & documents 148 135

Advertising in Flight Safety Magazine 74 43

Administrative fines 31 18

Insurance Recovery 2,500

Other sundry revenue 87 173

Total other revenue 2,840 369

C A S A A n n u a l R e p o r t 2 0 0 4 - 2

Financial Statements

CIVIL AVIATION SAFETY AUTHORITY

NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS for the year ended 30 June 2005

Note 6: Operating Expenses

Note 6A: Employee Expenses

Wages and salaries 52,249 53,172

Superannuation 9,782 9,716

Leave and other entitlements 5,333 2,433

Separation and redundancy 374 235

Other employee benefits 680 884

Total employee benefits expenses 68,418 66,440

Workers compensation premiums 725 468

Total employee expenses 69,143 66,908

Note 6B: Supplier Expenses

Services from external parties 25,552 25,856

Operating lease rentals 9,715 9,098

Total supplier expenses 35,266 34,954

Note 6C: Depreciation and Amortisation

Depreciation of property, plant and equipment 4,084 3,698

Amortisation of leased assets 1,350 890

Total depreciation and amortisation 5,434 4,588

The aggregate amounts of depreciation or amortisation expensed during the reporting period for each class of depreciable asset are as follows:

Buildings on freehold land 126 114

Leasehold improvements 1,320 1,530

Plant and equipment 2,058 1,500

Intangibles 1,930 1,444

Total depreciation and amortisation 5,434 4,588

Note 6D: Write-Down and Impairment of Assets

Bad and doubtful debts expense - loans - 40

Plant & equipment - revaluation decrement 120 -

Internally developed software - impairment - -

Other - -

Total write-down o f assets 120 40

(§>

CIVIL AVIATION SAFETY AUTHORITY

NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS for the year ended 30 June 2005

Note 7: Borrowing Costs Expense

Leases 122 46

Total borrowing costs expense 122 46

Note 8: Financial Assets

Note 8A: Receivables

Goods and services 409 360

Less: Provision for doubtful debts (55) (55)

354 305

GST receivable 427 422

Other receivables 439 -

Total receivables (net) 1,220 727

All receivables are current assets.

Receivables (gross) are aged as follows:

Not overdue 331 681

Overdue by:

Less than 30 days - -

30 to 60 days 473 65

60 to 90 days 447 7

More than 90 days 24 29

944 101

Total receivables (gross) 1,275 782

The provision for doubtful debts is aged as follows:

Not overdue - -

Overdue by:

Less than 30 days - 1

30 to 60 days 34 27

60 to 90 days - 1

More than 90 days 21 26

Total provision for doubtful debts 55 55

Receivables for Goods & Services

Credit terms are up front payments prior to service delivery in accordance with the Civil Aviation Act 1988 or issue of invoice, within 28 days of issue.

(2004: 28 days)

A S A A n n u a l R e p o r t 2 0 0 4

Financial Statements

CIVIL AVIATION SAFETY AUTHORITY

NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS for the year ended 30 June 2005

Note 8B: Accrued Revenue

Accrued revenue 1,263 833

Accrued interest 175 133

Miscellaneous 2 65

Total accrued revenue 1,441 1,031

Accrued Interest

The interest rates range from 5.4% to 5.7% (2004: 2.8% to 8.0%) and the frequency of payments range from monthly to quarterly.

Note 9: Non-Financial Assets

Note 9A: Land and Buildings

Buildings on freehold land

- a t fair value 30 June 2005 2,195 2,274

- Accumulated depreciation - (226)

2,195 2,048

- at cost - 18

-Accumulated depreciation - -

- 18

Total buildings on freehold land 2,195 2,066

Total Land and Buildings (non-current) 2,195 2,066

Note 9B: Infrastructure, Plant and Equipment

Technical Equipment

- a t fair value 30 June 2005 218 427

- accumulated depreciation - (112)

218 315

Technical Equipment

- at cost - 7

- accumulated depreciation - -

- 7

Total Technical Equipment 218 322

NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS for the year ended 30 June 2005

CIVIL AVIATION SAFETY AUTHORITY

Motor Vehicles

- at fair value 30 June 2005 1,456 236

- accumulated depreciation - (173)

1,456 t63

Motor Vehicles

- at cost - 1,379

- accumulated depreciation - (243)

- 1,136

Total Motor Vehicles 1,456 1,199

Office furniture and equipment

- at fair value 30 June 2005 456 702

- accumulated depreciation - (278)

456 424

Office furniture and equipment

- at cost - 659

- accumulated depreciation - (93)

- 566

Total Office furniture and equipment 456 990

Office Fitout

- a t fair value 30 June 2005 4,702 6,579

- accumulated depreciation - (2,763)

4,702 3,816

Office Fitout

- at cost - 1,261

- accumulated depreciation - (213)

- 1,048

Total Office Fitout 4,702 4,864

Computer equipment under finance lease

- at cost 6,728 4,356

- accumulated amortisation (4,919) (3,570)

Total Computer equipment under finance lease 1,809 786

Work in progress - at cost 112 323

Total Infrastructure, Plant and Equipment (non-current) 8,752 8,484

C A S A A n n u a l R e p o r t 2 0 0 4 - 2 149

Financial Statements

CIVIL AVIATION SAFETY AUTHORITY

NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS for the year ended 30 June 2005

Plant and equipment under finance lease is subject to revaluation. The carrying amount is included in the valuation figures above and is also disclosed in Table A and Table C in Note 9C below.

All revaluations are independent and are conducted in accordance with the revaluation policy stated at Note 1. In 2004-05, the revaluations were conducted by an independent valuer, the Australian Valuation Office, at fair value.

Movement in Asset Revaluation Reserve

Increment for Buildings 217

Decrement for Furniture and Fittings (320)

Increment for Office Fitout 906

Decrement for Technical Equipment (49)

Increment for Motor Vehicles 226

980

Increment for Property Plant and Equipment reversed & recognised as revenue (note 5E)

Decrement for Technical Equipment expensed (note 6D) (27)

Total Revaluation 953

CIVIL AVIATION SAFETY AUTHORITY

NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS for the year ended 30 June 2005

Note 9C: Analysis of Property, Plant, Equipment and Intangibles

TABLE A - Reconciliation of the opening and closing balances of property, plant and equipment

As at 1 July 2004

Gross book value

Accumulated Depreciation/Amortisation

Opening Net Book Value

Land and Buildings on Freehold Land

$’000

2,292

(226)

2,066

Other

Infrastructure, Plant and Equipment

$’000

11,572

(3,875)

7,697

Assets Under Finance Lease

$’000

Intangibles

4,356

(3,570)

786

19,245

(4,746)

14,499

37,465

(12,417)

25,048

Additions

By purchase

From acquisition of entities or operations (including restructuring)

742 2,373 9,725 12,878

Net revaluation increment/decrement

Depreciation/amortization expense

Recoverable Amount write-downs

217

(126)

736

(2,028) (1,350) (1,930)

953

(5,434)

Disposals

From disposal of entities or operations (including restructuring)

Other disposals (205) (205)

As at 30 June 2005 -

Gross book value 2,195 6,942 6,728 28,932 44,797

Accumulated depreciation/amortisation - - (4,919) (6,638) (11,557)

Closing Net Book Value 2,195 6,942 1,809 22,294 33,240

Buildings: The class of buildings includes 2 buildings, which are located on Federal Airports. The Authority does not have legal title to the land upon which the buildings are constructed.

Financial Statements

CIVIL AVIATION SAFETY AUTHORITY

NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS for the year ended 30 June 2005

Note 9C: Analysis of Property, Plant, Equipment and Intangibles

TABLE B - Assets at valuation

As at 30 June 2005

Gross value 2,195 6,942 - 9,137

Accumulated depreciation/amortisation - - - -

Closing Net Book Value 2,195 6,942 - 9,137

As at 30 June 2004

Gross value 2,274 7,944 - 10,218

Accumulated depreciation/amortisation (226) (3,326) - (3,552)

Closing Net Book Value 2,048 4,618 - 6,666

TABLE C - Assets held under finance lease

As at 30 June 2005

Gross value 6,728 6,728

Accumulated depreciation/amortisation (4,919) (4,919)

Closing Net Book Value 1,809 1,809

As at 30 June 2004

Gross value - 4,356 4,356

Accumulated depreciation/amortisation - (3,570) (3,570)

Closing Net Book Value - 786 786

NB All finance leases have been revalued in 2004-05. Amounts shown are revalued amounts and are also included in Table B above.

NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS for the year ended 30 June 2005

CIVIL AVIATION SAFETY AUTHORITY

TABLE D - Assets under construction

Gross value at 30 June 2005 ■ 112 20,143 20,255

Gross value at 30 June 2004 - 323 12,468 12,791

Note 9D: Intangibles

Computer software:

Internally developed - in progress (non-current) 20,143 12,468

Internally developed - in use (non-current) 8,789 5,507

Accumulated amortisation (6,638) (3,476)

2,151 2,031

Total intangibles 22,293 14,499

C A S A A n n u a l R e p o r t 2 0 0 4 - 2 0 0 5

Financial Statements

CIVIL AVIATION SAFETY AUTHORITY

NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS for the year ended 30 June 2005

TABLE A - Reconciliation of the opening and closing balances of intangibles

As at 1 July 2004

Gross book value 19,245

Accumulated depreciation/amortisation (4,746)

Net book value 14,499

Additions

By purchase 9,725

From acquisition of operations

Net revaluation increment/decrement -

Depreciation/Amortisation expense (1,930)

Recoverable Amount write-downs

Disposals

From disposal of operations -

Other disposals -

As at 30 June 2005

Gross book value 28,932

Accumulated depreciation/amortisation (6,638)

Net book value 22,294

sun

CIVIL AVIATION SAFETY AUTHORITY

NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS for the year ended 30 June 2005

Note 9E: Other Non-Financial Assets

Prepaid property rentals 663 429

Other prepayments - 271

Total other non-financial assets 663 700

Note 10 Interest Bearing Liabilities

Leases

Finance lease commitments

Payable:

Within one year 859 830

In one to five years 1,136 -

In more than five years - -

Minimum lease payments 1,995 830

Deduct: future finance charges (147) (25)

Total lease liability 1,848 805

Lease liability is categorised as follows:

Current 764 805

Non-current 1,085 -

Total lease liability 1,848 805

Finance leases exist in relation to certain major office equipment assets. The leases are non-cancellable and for a maximum term of five years. The Authority guarantees the residual values of all assets leased. The interest rate implicit in the leases averaged 6.34% (2003-04: 6.16%). The lease liabilities are secured by these assets.

C A S A A n n u a l R e p o r t 2 0 0 4 - 2 155

Financial Statements

CIVIL AVIATION SAFETY AUTHORITY

NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS for the year ended 30 June 2005

Note 11: Provisions

Note 11A: Employee Provisions

Salaries and wages 869 1,459

Leave 16,352 15,840

Superannuation 148 475

Superannuation on cost on leave provision 1,928 1,765

Aggregate employee entitlement liability 19,298 19,539

Aggregate employee benefit liability and related on costs 19,298 19,539

Note 11A: Employee Provisions (continued)

Current 8,694 9,522

Non-current 10,604 10,017

19,298 19,539

Note 11B: Other Provisions

Lease Restoration - Office Rental 721 660

Balance owing 1 July - 660

Balance owing 30 June 721 660

Nature of present obligation: Make good lease premises; Probability: Certain; Future Events: Termination of Lease; Nominal Value: $937,000; Present Value: $721,000

©

CIVIL AVIATION SAFETY AUTHORITY

NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS for the year ended 30 June 2005

Note 12: Payables

Note 12A: Supplier Payables

Trade creditors

Operating lease rentals

7,008 5,595

Total supplier payables 7,008 5,595

All supplier payables are current.

Trade Creditors Settlement is usually made net 30 days.

Note 12B: Other Payables

Revenue received in advance 499 167

Total other payables 499 167

All other payables are current.

C A S A A n n u a l R e p o r t 2 0 0 4 - 2 0 0 5 157

@ CIVIL AVIATION SAFETY AUTHORITY

NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS for the year ended 30 June 2005

Note 13: Analysis of Equity

Item Accumulated Statutory Funds Asset Revaluation Total Contributed

Results Reserve Equity

2005 2004 2005 2004 2005 2004 2005 2004

$’000 $000 $’000 $’000 $’000 $’000 $'000 $’000

Opening balance as at 1 July 2004 16,050 12,058 - - 1,352 1,352 2,150 2,030

Net surplus/deficit 12,540 3,992 - - - - -

Net revaluation increment/(decrement) 0 - - - 1,074 - ■ -

Transactions with owner:

Appropriations (equity injections) 0 - - - - - - 120

Closing balance as at 30 June 2005 28,590 16,050 - 2,425 1,352 2,150 2,150

Total equity attributable to the Australian Government 28,590 16,050 . . 2,425 1,352 2,150 2,150

TOTAL EQUITY

19,552 15,440

12,540 3,992

1,074 -

120

33.165 19,552

33.165 19,552

Financial Statements

■

CIVIL AVIATION SAFETY AUTHORITY

NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS

Note 14: Cash Flow Reconciliation .

Note 14A: Reconciliation of Operating Surplus to Net Cash from Operating Activities:

Operating surplus (deficit) before extraordinary items

Operating surplus (deficit)

12.540

12.540

3.992

3.992

Non- Cash Items

Depreciation and amortisation

Gain on disposal of assets

Deferred gain on disposal of assets

Net write down of non-current assets

Deferred write down of non-current assets

Foreign exchange gain

Capitalised borrowing costs

Share of associates profit

Deterioration in financial condition of guarantee during the period

Changes in Assets and Liabilities

(Increase) / decrease in receivables (other than loans)

(Increase) Z decrease in accrued revenue

(Increase) Z decrease in prepayments

Increase / (decrease) in employee provisions

Increase / (decrease) in supplier payables

Increase / (decrease) in grants payable

IncreaseZ(decrease) in provision for doubtful debts

IncreaseZ(decrease) in revenue received in advance

IncreaseZ(decrease) in provision for makegood

Increase Z (decrease) in other payables

Net cash from / (used by) operating activities Note: IPEX Lease amortisation write back of $830k included in depreciation & amortisation line

4,727

(81)

120

4,588

(3)

(467) 132

(409) 666

36 95

675 683

472 748

- (75)

332 117

62 145

18,007 11,088

C A S A A n n u a l R e p o r t 2 0 0 4 - 2

Financial Statements

CIVIL AVIATION SAFETY AUTHORITY

NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS for the year ended 30 June 2005

| . 1 ·â–  *!Λ· ^ ......

Note 14B: Reconciliation of Cash

Cash balance comprises:

Cash on hand

Authority 65 386

Deposits at call 25,910 18,425

Total cash 25,975 18,811

Balance of cash as at 30 June shown in the Statement of Cash Flows 25,975 18,811

Cash

Deposits are recognised at their nominal amounts, interest is credited to revenue as it accrues. Temporary surplus funds, mainly from fortnightly draw downs of appropriation and excise claims are placed on deposit at call with the Authority’s banker. Interest is earned on the daily balance at the prevailing rate for cash at bank and money on call and is paid at the beginning of the following month.

Note 15: Contingent Liabilities and Assets

Contingent liabilities

Claims for damages/costs1 300 700

Other Guarantees - -

Indemnities - -

Total contingent liabilities 300 700

Contingent assets

Legal claims

Net contingent liabilities 300 700

1 The $300,000 is made up o f $200,000 relating to Sydney Heli-Scenic Pty Ltd. This is the possible financial effect to CAS/l if Sydney Heli-Scenic Pty Ltd

is successful with its claim. CASA is currently appealing this case. CASA also has a claim which is covered by CASA's professional indemnity cover with

Comcover should the case proceed. In this event CASA will be required to pay the excess for that policy which amounts to $100,000.

(§)

CIVIL AVIATION SAFETY AUTHORITY

NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS for the year ended 30 June 2005

Unquantifiable Contingencies

The major litigation where the liability is unquantifiable is the Deep Vein Thrombosis (DVT) litigation. Potentially this could run into hundreds of millions of dollars. However, CASA itself is not liable for this amount as this would be covered by CASA’s AGL policy for the part of the relevant period and the Commonwealth deed of indemnity for the remainder of the period.

Remote Contingencies

At 30 June 2005, CASA had a number of legal claims that arose out of proceedings brought by third parties against the Authority, for which CASA has insurance cover for all claims. In all other cases, CASA has denied liability and is defending the claims. The probability of future payments as a result of these claims is remote.

Note 16: Director Remuneration

2005 2004

No. No

The number of directors of the Authority included in these figures are shown below in the relevant remuneration bands

Nil -$ 9 ,9 9 9 - 1

$ 10,000 -$ 19,999 - 2

$ 20,000 - $ 29,999 - 1

$ 160,000 -$ 169,999 - 1

$ 360,000 - $ 369,999 1 “

Total number o f directors o f the Authority 1 5

$ $

Aggregate amount of superannuation payments in connection with the retirement of directors

Other remuneration received or due and receivable by directors of the Authority 364,531 213,010

Total remuneration received or due and receivable by directors of the Authority 364,531 213,010

The director of CASA is appointed by the Minister for Transport and Regional Services. The Officer receives no additional remuneration for performing his duties of director. The total remuneration of this Officer whilst in the capacity of Director is $364,531 (2004: $213,010). This amount is included in Note 18 Remuneration of Officers.

Financial Statements

CIVIL AVIATION SAFETY AUTHORITY

NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS for the year ended 30 June 2005

Note 17: Related Party Disclosures

Directors of the Authority

The Director of the Authority during the year was:

Mr B Byron - Appointed Director of Aviation Safety 1 December 2003

The aggregate remuneration of Directors is disclosed in Note 16.

Transactions with Directors or Director related entities

There are no transactions between director-related entitities and the Authority

Transactions with related parties

Transactions between related parties are on normal commercial terms and conditions unless otherwise stated.

CIVIL AVIATION SAFETY AUTHORITY

NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS for the year ended 30 June 2005

Note 18: Remuneration of Officers

The number of officers who received or were due to receive total remuneration of $100,000 or more:

$ 100,000-$ 109,999 - 1

$ 110,000-$ 119,999 1 3

$ 120,000-$ 129,999 4 3

$ 130,000 -$ 139,999 3 6

$ 140,000-$ 149,999 8 6

$ 150,000-$ 159,999 8 6

$ 160,000-$ 169,999 3 2

$ 170,000-$ 179,999 1 2

$ 180,000-$ 189,999 - 4

$ 190,000-$ 199,999 1 2

$ 200,000 - $ 209,999 1 1

$210,000-$ 219,999 1 -

$ 220,000 - $ 229,999 - -

$ 230,000 - $ 239,999 - -

$ 240,000 - $ 249,999 - -

$ 250,000 - $ 259,999 - -

$ 260,000 - $ 269,999 - -

$ 270,000 - $ 279,999 - -

$ 280,000 - $ 289,999 1 -

$ 290,000 - $ 299,999 - -

$ 300,000 - $ 319,999 - 1

$ 360,000 - $ 369,999 1 -

Total The aggregate amount of total remuneration of officers shown above.

33

5,016,476

37

5,779,053

The aggregate amount of separation and redundancy/termination benefit payments during the year to officers shown above. 319,773 59,874

Financial Statements

CIVIL AVIATION SAFETY AUTHORITY

NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS for the year ended 30 June 2005

The officer remuneration includes all officers concerned with or taking part in the management of the economic entity during 2004-05.

Note 19: Remuneration of Auditors

Remuneration to the Auditor-General for auditing the financial statements for the reporting period.

The fair value of services provided was: 64,000 44,000

No other services were provided by the Auditor-General during the reporting period.

Note 20: Average Staffing Levels

2005 2004

The average staffing levels for the Authority during the year were: ________ 704____________ 701

Non- Interest Total Weighted

Bearing Average

Effective

. Interest Rate

2005 2004 2005 2004 2005 2004

$000 $000 $000 $000 % %

65 386

25,910 18,425

1,221 360

1,440 1,031

28,636 20,202

62,539 46,318

1,848 805

7,008 5,595

499 167

9,355 6,567

29,374 26,766

3.83

5.25

n/a

3.55

4.89

n/a

6.34 6.16

Financial Statements

CIVIL AVIATION SAFETY AUTHORITY

NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS for the year ended 30 June 2005

Note 21B: Net Fair Values of Financial Assets and Liabilities

E :- v „ » v ,s u "

1 'Λ. , = ■Financial AssetsCash on hand 14B 65 65 386 386Deposits at call 14B 25,910 25,910 18,425 18,425Receivables for goodsand services 8A 1,221 1,221 360 360Accrued revenue 8B 1,440 1,440 1,031 1,03128,636 28,636 20,202 20,202Financial LiabilitiesFinance lease liabilities 10 1,848 1,848 805 805Suppliers payables 12A 7,008 7,008 5,595 5,595Other payables 12B 499 499 167 1679,355 9,355 6,567 6,567Financial Liabilities(Unrecognised)Other guarantees 15 - - - -Indemnities 15 - - - -Total FinancialLiabilities(Unrecognised) . - - -Financial AssetsThe net fair values of cash, deposits on call and non-interest-bearing monetary financial assets approximate their carrying amounts. The net fair value of Bank Bills and Negotiable Certificates of Deposit are recognised as the discounted value together with interest, which would be due at the market rate on the day.Financial LiabilitiesThe net fair values of all finance leases are based on discounted cash flows using estimates of interest rates implicit in the leases.The net fair values for supplier payables which are short-term in nature, are approximated by their carrying amounts.Note 21C: Credit Risk ExposuresThe Authority’s maximum exposures to credit risk at reporting date in relation to each class of recognised financial assets is the carrying amount of those assets as indicated in the Statement of Financial Position.CASA has no significant exposures to any concentrations of credit risk.@

CIVIL AVIATION SAFETY AUTHORITY

NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS for the year ended 30 June 2005

Note 22: Appropriations

Year ended 30 June

Balance carried forward from previous year .

Appropriation Acts 1 and 3 49,039 45,599 - - - -

Appropriation Acts 2 and 4 - 120 - - - -

Available for payment of CRF 49,039 45,719 - - - -

Cash payments made out of CRF

Balance carried forward to next year

49,039 45,719

.

Represented by: Appropriations Receivable

Total

2005 2004

$’000 $’000

This table reports on appropriations made by the Parliament of the Consolidated Revenue Fund (CRF) in respect of CASA. When received by CASA, the payments made are legally the money of CASA and do not represent any balance remaining in the CRF.

Financial Statements

CIVIL AVIATION SAFETY AUTHORITY

NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS for the year ended 30 June 2005

Note 23: Reporting of Outcomes

Note 23A: Outcomes of the Authority

CASA'S outputs and vision “Safe skies for all”, is inherently linked to the Transport and Regional Services’ portfolio outcome “A better transport system for Australia”.

CASA is structured to meet a sole outcome “Safe skies for all”. This outcome is achieved through four core outputs.

Output 1 - Aviation Safety Standards

A safer aviation community achieved through development and application of quality safety standards.

Output 2 - Aviation Safety Compliance

Compliance with Australian aviation safety legislation is secured through effective education, surveillance and procedurally fair enforcement.

Output 3 - Aviation Safety Promotion

An informed and safety motivated aviation community is achieved.

Output 4 - Aviation Regulatory Services

Regulatory services are provided in a timely and consistent manner, aligned with CASA’s safety obligations.

CIVIL AVIATION SAFETY AUTHORITY

NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS for the year ended 30 June 2005

Note 23B: Net Cost of Outcome Delivery

Expenses

Administered - -

Departmental 110,167 106,867

Total expenses 110,167 106,867

Costs recovered from provision of goods and services to the non-government sector

Administered - -

Departmental 4,897 3,203

Total costs recovered 4,897 3,203

Other external revenues

Departmental

Aviation fuel excise 64,477 60,420

Sale of goods and services - to related entities - -

Interest 1,291 934

Donation and bequests - -

Revenue from sale of assets 283 334

Industry contributions - -

Reversal of previous asset write-downs - -

Net foreign exchange gains - -

Other 2,840 369

Total Departmental 68,891 62,057

Total other external revenues 68,891 62,057

Net cost/(contribution) o f outcome 36,379 41,607

The net costs shown include intra-government costs that would be eliminated in calculating the actual Budget outcome.

Refer to Outcome 1 Resourcing Table on page 170 of this annual report.

CASA uses an Activity Based Costing System to determine the attribution of its shared items. This system was based on a time and motion study for corporate activities conducted in 2002 for the 2002-2003 Budget. An update of the time and motion study has been concluded for the 2005-2006 Budget.

A S A A n n u a R e p o r t 2 0 0 4 - 2 0 169

CIVIL AVIATION SAFETY AUTHORITY

NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS for the year ended 30 June 2005 Note 23C: Departmental Revenues and Expenses by Output Groups and Outputs

1

Operating expenses

Employees 17,604 17,643 33,299 32,199 6,361 2,336 11,879 14,730

Suppliers 6,877 6,364 19,694 18,889 7,042 5,344 1,654 4,357

Depreciation and amortisation 1,539 1,312 3,304 2,706 216 149 375 421

Write-down of assets - - - - - - - 40

Value of assets disposed 57 108 122 178 8 8 14 37

Borrowing cost expense 35 13 74 27 5 2 8 4

Extraordinary loss

Total operating expenses

Funded by:

26,112 25,440 56,493 53,999 13,632 7,839 13,930 19,589

Revenues from Government 28,901 27,957 4,509 4,285 14,357 12,148 1,272 1,209

Aviation fuel excise - - 50,292 40,786 - - 14,185 19,634

Regulatory service fees - - - - - - 4,897 3,203

Interest 366 267 785 551 51 30 89 86

Revenue from Sale of Assets 72 118 136 171 26 7 49 38

Other 804 105 1,727 218 113 12 196 34

Total operating revenues 30,143 28,447 57,449 46,011 14,547 12,197 20,688 24,204

Total

69,143 66,908

35,267 34,954

5,434 4,588

- 40

201 331

122 46

110,167 106,867

49,039 45,599

64,477 60,420

4,897 3,203

1,291 934

283 334

2,840 369

122,827 110,859

The Authority’s outcomes and outputs are described at Note 23A.

Part 7

Appendices

CASA A n n u a

Appendices

Committee members

Members of The Audit And Risk Committee

Information about members of the Audit and Risk Committee, other than the Deputy Chief Executive Officer and Chief Operating Officer, M r Bruce Gemmell, is provided below. For information on Mr Gemmell refer to page 62 of the report.

Barbara Yeoh, BSc (Hons), Fellow, AICD Chair, A udit and Risk Committee - A pril 2004 to present

Ms Yeoh is the principal of Barbara Yeoh & Associates Pty Ltd. Before establishing her own financial consultancy, Ms Yeoh held the position of Director, Corporate Advisory with Oxley Corporate Finance Ltd between 1992 and 2000. This followed six years as General Manager of the Treasury Corporation of Victoria, and two years with the Victorian Ministry of Transport as Assistant Director General, Financial Management,

including a period as Acting Deputy Director General. Fier early career was spent with Telcom Australia and the Australian Bureau of Statistics.

Ms Yeoh is a member of the boards of Southern & Eastern Integrated Transport Authority and Eastern Health and Housing Guarantee Fund Limited. She chairs the Finance and Audit Committee, Finance Committee and Audit and Management Committee respectively of those organisations.

In addition, she chairs the Victorian Fisheries Compensation Assessment Panel and the ACT Government Finance and Investment Advisory Board, and is a member of the Commonwealth Fishing Rights Allocation Review Panel.

Ms Yeoh has held numerous previous appointments on a wide range of boards, councils and committees.

She is a Fellow of the Australian Institute of Company Directors.

Michael Lewis, BA (Hons) Economics Member, A udit and Risk Committee - April 2004 to present

Mr Lewis was an Executive Director with the Australian National Audit Office from 1993 to 2003.

He headed a branch responsible for conducting performance audits within four portfolios, including the Transport and Regional Services portfolio, and in the area of human resource management. As an Audit Manager between 1990 and 1993, he led performance audits on matters including the Diesel Fuel Rebate Scheme and Energy Efficiency in Commonwealth Buildings.

Mr Lewis joined ANAO from the Australian Broadcasting Corporation, where he assisted in a series of efficiency reviews and the introduction of Program Budgeting. Between 1982 and 1987 he worked with the Commonwealth Department of Finance examining budget bids from agencies in the Transport and Communications portfolio.

His early career was in the insurance industry as a broker and underwriter.

Mr Lewis is an Associate of the Insurance Institute of Canada and of the Australian Insurance Institute.

Martin Dolan Member, Audit and Risk Committee - A pril 2004 to present

Martin Dolan is the interim Chief Executive Officer of the Australian Energy Markets Commission and was previously the Executive Director, Aviation and Airports, Department of Transport and Regional Services.

Mr Dolan joined the Australian Public Service in 1980 to work with the government's overseas aid program, and continued in that field for eleven years. He then moved to the Department of Primary Industries and Energy (later to become the Department of Agriculture, Fisheries and Forestry). Fie worked there for ten years, principally in corporate management roles including planning and evaluation, ministerial support, communications and legal services, financial management and corporate services. His final roles were those of Chief Financial Officer and then Head of Corporate Management.

In 2001, Mr Dolan transferred to the Department of Transport and Regional Services. After completing a review of the department's road programs, he took over management of the Airports Division. He was then responsible for the Department's role in selling Sydney Airport, the enhancement of aviation security,

post-Ansett aviation policy and aviation safety reform.

Standards development

Draft Manuals of Standards published

CASR Part 21 - Certification and airworthiness requirements for aircraft and parts

CASR Part 146 - Engineering Representatives

CASR Part 90 - Additional Airworthiness Requirements

CASR Part 141 - Standards for flight training operators

Amendments to the Civil Aviation Act 1988 promulgated

The Civil Aviation Act 1988 (the Act) was amended by the Civil Aviation Amendment Act 2005 (No. 86/2005). The amendments came into effect on 6 July 2005,

The amendments amended the Act to:

S> Empower the Governor-General to make regulations that may be inconsistent with

the Disability Discrimination Act 1992 and the Sex Discrimination Act 1984 and to put beyond doubt the validity of existing regulations and past actions based on those regulations;

® Imposes a condition on all AOCs that AOC holders continue to satisfy CASA of the matters set out in section 28 of the Act for the life of the AOC (which is presently at paragraph 4.4 of CAO 82.0); and

$> Changes references in the Act to 'foreign aircraft' to 'foreign-registered aircraft' (which is the defined term).

Appendices

The Civil Aviation Act 1988 (the Act) was also amended by the Aviation Security Amendment Act 2004 (No. 149/2004). The amendments came into effect on 10 March 2005.

The amendment inserted a provision into the Act which provides that CASA's functions include functions conferred on it under the Aviation Transport Security Act 2004 (the ATS Act). This includes functions conferred on CASA under regulations made under the ATS Act and also repealed subsection 9 (5) of the Act. This is to remove any possibility that CASA is precluded from taking on some security functions.

The amendment also provides that regulations may be made under the Act formulating a scheme in relation to security status checking.

Civil Aviation Safety Regulations 1998 made or promulgated

Housekeeping Amendments to CAR 1988 and CASR 1998 and Introduction of CASR Part 11 Civil Aviation Amendment Regulations 2004 (No.4), Statutory Rules 2004 No.345

On 3 December 2004, amendments were made to the Civil Aviation Safety Regulations 1998 (CASR) by inserting a new Part 11, entitled "Regulatory administrative procedures", into those regulations. The Regulations also make changes to the Civil Aviation Regulations 1988 (CAR) consequential to the making of CASR Part 11. CASR Part 11 and its consequential amendments are contained in Schedule 1 and Schedule 2 to the Regulations.

CASR Part 11 is a completely new set of regulations, developed as part of CASAs Regulatory Reform Programme (RRP), to provide a regulatory regime that covers the administration of authorisations, exemptions, directions, delegations and Manuals of Standards. CASR Part 11 provides CASA with administrative and regulatory powers, and sets out associated procedures, necessary for the efficient administration of the civil aviation safety system. These powers and procedures relate to the:

® processing of applications for authorisations and variations issued under the CASRs;

® issue of safety-related directions;

® issue of exemptions from the CASRs;

® delegation of CASAs powers under the CASRs; and

® issue of Manuals of Standards.

Further, the Regulations included a large number of amendments to the CARs and CASRs of a housekeeping nature.

Notification of Making of Civil Aviation Safety Amendment Regulations to CASR Part 39 - Airworthiness Directives - Statutory Rules 2004 No. 230 Civil Aviation Safety Amendment Regulations 2004 (No.2), Statutory Rules 2004 No.230

On 26 July 2004, amendments were made to rectify a number of deficiencies found following the implementation of Part 39 of the Civil Aviation Safety Regulations!998 (CASRs). CASR Part 39 deals with Airworthiness Directives (ADs), which are binding directions issued by CASA to aircraft owners to undertake maintenance or airworthiness-related tasks to ensure aviation safety.

©

CASH Part 39 commenced on 1 January 2000. The Part covers the requirements for the issue of ADs and replaced provisions in the Civil Aviation Regulations 1988 on the same subject matter. In general CASR Part 39 harmonised with Part 39 of the Federal Aviation Regulations (FAR) of the United States.

Since the introduction of Part 39, a number of problems had arisen in relation to the:

® issue of special flight permits for aircraft affected by an AD;

® requirements of an AD in relation to manufacturer's documentation;

® exclusion process and harmonisation of this process with other National Airworthiness Authorities (NAAs); and

® responsibility for ensuring an AD is complied with.

The amendments to CASR Part 39:

® clarify who is responsible for compliance with an AD;

® enable the issue of a special flight permit so that aircraft can fly to a maintenance base to carry out the requirements of an AD;

® allow an AD to be written to permit compliance with the latest instructions issued by the manufacturer of the aircraft or aeronautical product referred to in the AD; and

® align the requirements for issuing exclusions to an AD with the same practices applied by the United States Federal Aviation Administration (FAA) and other national airworthiness authorities (NAAs).

Amendment Regulations to Civil Aviation Safety Regulations 1998, Civil Aviation Regulations 1988 Civil Aviation Amendment Regulations 2004 (No.2), Statutory Rules 2004 No.216

On 12 July 2004, amendments were made to the Civil Aviation Regulations 1988 (CARs) and the Civil Aviation Safety Regulations 1998 (CASRs) to provide for a change of name by a body, which administers certain sports aviation activities in Australia.

The Australian Ultralight Federation Inc. (AUF) was a body incorporated under the Associations Incorporation Act 1991 of the Australian Capital Territory. It had, for many years, administered rules for operating and maintaining certain small aeroplanes commonly known as 'ultralights', under arrangements with the Civil Aviation Safety Authority (CASA). In order to do so, a number of regulations

in CAR and CASR made reference to the AUF, and aeroplanes operated and maintained in accordance with the rules of the AUF were exempt from a number of provisions of the CARs and CASRs through the operation of Civil Aviation Orders (CAOs).

The membership of the AUF voted to change the organisation's name to Recreational Aviation Australia Inc. (RAA), which occurred on 28 April 2004. Although the change of name did not result in a change of legal entity there was some doubt about the legal effect of the name change on the exemptions given to

C A S A A n n u a l R e p o r t 2 0 0 4 - 2 0 0 5 1

Appendices

the AUF. To avoid this doubt, it was decided to amend the references to the "AUF" (whether its full name or its acronym) in the CARs, the CASRs and the CAOs to the "RAA".

The Regulations, therefore, amended the CARs and the CASRs to change the references to the AUF to the RAA.

Amendment Regulations to Civil Aviation (Fees) Regulations Civil Aviation (Fees) Amendment Regulations 2004 (No.1), Statutory Rules 2004 No.211

On 12 July 2004, amendments were made to the Civil Aviation (Fees) Regulations (the Fees Regulations) to align the fees charged for regulatory services provided by the Civil Aviation Safety Authority (CASA) with today's prices and to position CASA and the aviation industry for the move to full cost recovery for those services in line with the Government's policy on cost recovery. The previous fees and charges were in place since 1995 and had not been adjusted for inflation nor the goods and services tax. The impact was that CASA's revenue from fees and charges steadily declined in real terms and did not maintained parity against the actual cost of the services provided.

The Regulations gave effect to the Minister for Transport and Regional Services' announcement in the 2004-2005 Portfolio Budget Statement for measures to increase CASA fees and charges and to reflect the Government's policy on cost recovery.

In developing the Regulations, CASA undertook a cost modelling analysis in an effort to calculate the true cost of CASA activities. Nevertheless, it was decided not to recover the whole cost of providing services at this stage, as part of a staged implementation of full cost recovery in line with the Government's guidelines for cost recovery.

The increase to the hourly rate charged for CASA regulatory services is limited to the calculated direct staff costs, together with an overhead which takes into account increases in staff costs over the past nine years and is adjusted from $75 per hour to $130 per hour. Increases in fixed fees for regulatory services are calculated on the direct staff costs, together with an administrative fee which takes into account increases in the Consumer Price Index (CPI) over the nine-year period, and the addition of the 10%

Goods and Services Tax (GST) for those services subject to that tax.

No new fees or charges were imposed by the Regulations. That is, although the fees and charges for the services currently listed in the Fees Regulations are being increased, no new services are being added to the list. Nevertheless, the Regulations clarified existing services by amending terminology to align with the new Civil Aviation Safety Regulations 1998 (CASR) and divided generic descriptions of services into specific subsets of those services.

The Regulations provided transitional measures for services which were requested before, but which were provided after, commencement of the Regulations. The Regulations also made technical amendments to change the citation of the Fees Regulations, align the terminology used in the Fees Regulations with the terminology in the Civil Aviation Regulations 1988 (CAR) and the Civil Aviation Safety Regulations 1998

(CASR), and to remove charges that were no longer applicable.

Definition of Air Traffic Control Civil Aviation Amendment Regulations 2004 (No.3), Statutory Rules 2004 No.217

On 12 July 2004, amendments were made to the Civil Aviation Regulations 1988(1988 Regulations) and the Civil Aviation Safety Regulations 1998 (1998 Regulations).

Regulation 2 of the 1988 Regulations relates to the Interpretation of terms and defined "air traffic control" to mean:

® Airservices Australia (AA) in its capacity as a provider of air traffic control services; or

® The Defence Force in its capacity as a provider of air traffic control services.

The purpose of the amendment was to add to the list of service providers in the definition of air traffic control in regulation 2 of the 1988 Regulations to make it consistent with the provisions of subsection 11 (3) of the Air Services Act 1995 which provides that where AA may provide a facility or service, it may do so:

1. itself; or

2. in cooperation with another person (including the Commonwealth); or

3. by arranging for another person (including the Commonwealth) to do so on its behalf,

and regulation 172.024 of the 1998 Regulations, which provides that a person is eligible to apply for approval as an Air Traffic Services provider if the person is any of the following:

1. the Commonwealth;

2. AA;

3. a person who is to provide an air traffic service:

a. in cooperation with AA, in accordance with paragraph 11 (3) (b) of the Air Services Act 1995; or

b. by arrangement with AA, in accordance with paragraph 11 (3) (c) of the Air Services Act 1995.

The changes also ensured that the term 'air traffic control' for the purposes of the 1988 Regulations also included any person who provides air traffic control services in cooperation with AA or under arrangement with AA.

Civil Aviation Regulations 1988 made or promulgated

Housekeeping Amendments to CAR 1988 and CASR 1998 and Introduction of CASR Part 11 Civil Aviation Amendment Regulations 2004 (No.4), Statutory Rules 2004 No.345

On 3 December 2004, amendments were made to the Civil Aviation Safety Regulations 1998 (CASR) by inserting a new Part 11, entitled "Regulatory administrative procedures", into those regulations. The Regulations also make changes to the Civil Aviation Regulations 1988 (CAR) consequential to the making of CASR Part 11. CASR Part 11 and its consequential amendments are contained in Schedule 1 and Schedule 2 to the Regulations.

CASR Part 11 is a completely new set of regulations, developed as part of CASA's Regulatory Reform Programme (RRP), to provide a regulatory regime that covers the administration of authorisations, exemptions, directions, delegations and

Appendices

Manuals of Standards. CASR Part 11 provides CASA with administrative and regulatory powers, and sets out associated procedures, necessary for the efficient administration of the civil aviation safety system. These powers and procedures relate to the:

® processing of applications for authorisations and variations issued under the CASRs;

® issue of safety-related directions;

® issue of exemptions from the CASRs;

® delegation of CASAs powers under the CASRs; and

® issue of Manuals of Standards.

Further, the Regulations included a large number of amendments to the CARs and CASRs of a housekeeping nature.

Civil Aviation Orders made or promulgated

® Amendment to CAO 20.7.4 (Civil Aviation Amendment Order (No. 3) 2004 19 July 2004)

® Amendment to various CAOs relating to the change of name of the Australian Ultralight Federation to Recreational Aviation Australia Incorporated (Civil Aviation Amendment Order (No. 4) 2004 19 July 2004)

® Amendment to CAOs 95.8, 95.10, 95.12, 95.12.1,95.14, 95.32 and 95.55 (Civil Aviation Amendment Order (No. 5) 2004 8 September 2004)

® New CAO 95.33 (Civil Aviation Amendment Order (No. 6) 2004 17 September 2004)

® Amendment to CAO 100.90 - Administration and Procedure - Aircraft Maintenance Engineer Licences - General requirements (Civil Aviation Amendment Order (No. 7) 2004 24 November 2004)

® Amendment to CAO 40.2.1 - Instrument Rating, and 40.2.3 - Private I.F.R. Rating (Civil Aviation Amendment Order (No. 9) 2004 24 November 2004)

® Amendment to CAO 95.33 - Eurocopter EC665 Tiger Armed Reconnaissance Plelicopter (Civil Aviation Amendment Order (No. 10) 2004 29 November 2004)

® Exemptions from Provisions of the Civil Aviation Regulations - Gyroplanes having an Empty Weight not in Excess of 250 kg (Civil Aviation Order 95.12 Amendment Order (No. 1)2005 16 June 2005)

® Aeroplane weight and performance limitations for specified aeroplanes above 5 700 kg (Civil Aviation Order 20.7.1 B Amendment Order (No. 1) 2005 15 June 2005)

® Amendment of CAO 40.1.0- Aircraft Endorsement - Aeroplanes (Civil Aviation Amendment Order (No. 6) 2005 13 May 2005)

® Amendment of CAO 40.3.0 - Aircraft Endorsement - Helicopters (Civil Aviation Amendment Order (No. 5) 2005 13 May 2005)

® Amendment of CAO 40.3.0 - Aircraft Endorsement - Helicopters (Civil Aviation Amendment Order (No. 4) 2005 30 March 2005)

® Amendments to CAOs 20.18, 82.0 and 82.1 - Use of Terrain Avoidance Warning Systems (Civil Aviation Amendment Order (No. 3) 2005 18 March 2005)

® Amendment to CAO 40.3.0 - Aircraft Endorsements - Helicopters (Civil Aviation Amendment Order (No. 2) 2005 21 February 2005)

® Amendments to CAO 20.18, CAO 82.0, CAO 82.1 and CAO 82.3- CAO 20.18 - Aircraft Equipment - Basic Operational Requirements, CAO 82.0 - Air Operators' Certificates - Applications for Certificates and General Requirements, CAO 82.1 - Conditions on Air Operators' Certificates Authorising Charter Operations and Aerial Work Operations, and CAO 82.3 - Conditions on Air Operators' Certificates Authorising Regular Public Transport Operations in Other Than High Capacity Aircraft (Civil Aviation Amendment Order (No. 1) 2005 4 February 2005)

® Amendment to CAOs 40.1.0 - Aircraft Endorsements - Aeroplanes, and 40.3.0 - Aircraft Endorsement - Helicopters (Civil Aviation Amendment Order (No. 12) 2004 5 January 2005)

® Amendment to CAO 82.3 - Conditions on Air Operators' Certificates Authorising Regular Public Transport Operations in Other Than High Capacity Aircraft (Civil Aviation Amendment Order (No. 8) 2004 5 January 2005)

Manual of Standards (MOS) made or promulgated

® Amendment to MOS Part 65 - Air traffic services licensing and training requirements (Manual of Standards Part 65 Amendment Instrument (No. 1) 2005 24 January 2005)

® Amendment to MOS Subpart 139.H - Aerodrome rescue and fire fighting services (Manual of Standards Subpart 139.H Amendment (No. 1) 2005 24 January 2005)

Appendices

Table 11: New Legislative Projects initiated

Project Title

Project no. FS 05/04 Removal of administrative barriers from Section 40.1.7 of the CAOs for the issue of a Flight Instructor (Aeroplane) Rating

Project no. OS 05/07 Preventing the inadvertent authorisation of warbird flights over populated areas

Project no. OS 05/06 Identification of aircraft type and model on an AOC

Project no. OS 05/05 Maximum fuel capacity — Single Place Gyroplanes

Project no. AS 05/02 Standards for Helicopter Landing Sites (HLS)

Project no. OS 05/04 Disclosure of certain issues associated with dormant AOCs

Project no. OS 05/03 Administrative and operational requirements related to Light Sport Aircraft

Project no. CS 05/01 Certification requirements related to the design, manufacturing and airworthiness of UAVs

Project no. MS 05/02 Maintenance of Light Sport Aircraft (LSA)

Project no. FS 05/01 Guidance on issuing aerobatic approvals and permissions

Project no. FS 05/02 Multi-engine aeroplane flight training

Project no. FS 05/03 Guidelines for night VFR training and proficiency

Project no. OS 05/02 Multi-engine helicopter operational performance standards

Project no. MS 05/01 Appointment of the Head of Aircraft Airworthiness and Maintenance Control (HAAMC) — AOC entry control process

Project no. OS 05/01 Post Implementation Review (PIR) — CASR Part 92

Project no. AS 05/01 AIP Book Legislative Support

Project no. AS 04/08 Australian Aircraft Equipment Survey

Rule Affected

CAO 40.1.7

CAR 262AM and CASR 21.176

CAO 82.1

CAO Section 95.12 and CASR Part 200

CASR Part 139, MOS for Part 139, CAR 92, CAAP 92-2

CAO Part 82 series

CAO Part 95 series (specifically CAO Parts 95.4, 95.12, 95.32, 95.54 and 95.55)

CAO Part 92

CAO Part 95

Proposed CAAP 155-1 (0) and existing Flight Crew Licensing Procedures Manual

CAAP 5.23-1(0)

Proposed CAAP 5.13-2(0)

CAO Section 20.7

CAO 82.0

CASR Part 92

Various proposed CASRs (e.g. Part 91, Part 71)

Nil

Table 11: New Legislative Projects initiated (continued)

Project no. MS 04/04 Amendment of CASR Part 47 to address SSCRO recommendations CASR Part 47

Project no. FS 04/02 Review of instrument rating and private IFR rating to conform with new ICAO naming convention (CAO 40.2.1 and CAO 40.2.3)

CAO 40.2.1 and CAO 40.2.3

Project no. CS 04/08 Review of equipment and process control standards (CAO Parts 103 and 108) CAO 103 & 108

Project no. OS 04/04 Exemption of Eurocopter EC 665 from CAR and CASR (CAO 95 series). CAO 95 series

Project no. AS 04/07 PIR - Air traffic service providers (CASR Part 172). CASR Part 172

Project no. AS 04/06 PIR - Aeronautical telecommunication service and radionavigation service providers (CASR Part 171).

CASR Part 171

Project no. AS 04/05 PIR - Air traffic services training providers (CASR Part 143). CASR Part 143

Project no. AS 04/04 PIR - Air traffic services licensing (CASR Part 65). CASR Part 65

Project no. MS 04/03 Airworthiness and maintenance control for aircraft conducting air experience and corporate operations (under CASR Part 132)

CASR Part 132

Project no. CS 04/07 Proposed AC on Global Positioning System (GPS): general installation guidelines

Advisory Circular 21-36

Project no. CS 04/06 Applicability of weight and performance limitations to special category aeroplanes

CAO 20.7.1B

Project no. CS 04/05 Mandatory Compliance with Country-of-Origin ADs Rule affected: existing CASR Part 39

Appendices

Involvement in ICAO activities

CASA plays an essential role in Australia's participation in International Civil Aviation Organisation (ICAO) activities relating to the development of international aviation safety standards. The following are indicative of the contributions made by Australia's expertise to ICAO's work during 2004-05.

Aerodromes

In consultation with ICAO and other international aviation authorities, CASA is contributing to the development of a strategy to allow the introduction of the Airbus A380 into aerodromes without major airport works requirements.

Asia Pacific Planning & Implementation Regional Group (APANPIRG)

CASA participates regularly in the various study groups of this ICAO forum within our region (e.g. Regional Airspace Safety Monitoring Study Group; Air Traffic Management, Aeronautical Information Service & Search and Rescue Study Group; Communications, Navigation, Surveillance & Meteorology Study Group).

Flight Crew Licensing and Training

Australia again chaired the Flight Crew Licensing and Training Panel (FCLTP) that brought to completion the work programme given to it by the Air Navigation Commission of ICAO. The FCLTP was able to make unanimous recommendations on a wide range of modifications to current Standards and Recommended Practises (SARPs) and a significant set of new SARPs for Annex 1 - Personnel Licensing. The Air Navigation Commission was able to remark most positively on the standard and timeliness of the Panel's work along with the international spirit of co-operation that lead to consensus on all of the Panel's recommendations.

In particular, Australia was able to make significant contributions to the competency- based standards for the new Muiti-crew Pilot Licence (MPL), recognition of synthetic training devices for credit towards licences, the rewrite of Chapter 2 and the clarification of the intent of a number of SARPs in Chapter 1 which had been variously interpreted by States to date. Australia was also instrumental in philosophy and content development of the new Procedures for Air Navigation Services - Training (PANS-TRG) document which supports Annex 1 to the convention.

Operations

CASA continues to make significant contributions to the work of the ICAO Operations Panel (OPSP). The Air Navigation Commission (ANC) has tasked the OPSP with developing Standards and Recommended Practices (SARPs) and Guidance Material (CM) for Annex 6 of the International Convention on Civil Aviation, and related operational aspects of Procedures for Air Navigation Services (PANS - OPS and

PANS ATM).

A CASA staff member was appointed as Chair of the Operations Panel at OPS P/6 held in Montreal in September 2003, and has continued to lead and guide the discussions of this group of international technical experts through three subsequent meetings of the OPSP Working Group. Through his involvement, CASA is continuing to play a leading

role in the development of SARPs and CM for Extended Diversion Time Operations (ETOPS). Regulations governing ETOPS are under development in a joint CASA/CAA New Zealand project team, which this officer also chairs.

These important regulations will harmonise the requirements of Australia and New Zealand and are expected to have a flow-on effect back through to the ICAO OPSP work as other States take note of what Australia and New Zealand are doing.

OPSP technical subgroups are established to deal with SARPs and GM relating to flight and duty time limitations, head-up guidance systems; electronic flight bags; single-engine IMC (instrument meteorological conditions) operations; land and

hold short operations (LAHSO); precision radar monitoring (PRM) operations; and operations on wet and contaminated runways. Other CASA officers contribute from time to time through the OPSP Chairman to the work of these subgroups.

For example, a significant percentage of the amendment proposals to Annex 6 Part I contained in a recent ICAO State Letter in respect of the operation of single­ engine turbine-powered aeroplanes in IMC are largely the work of a CASA officer.

The operational issues under review by the OPSP have considerable global significance, and the respect with which the opinions and experience of CASA officers are regarded within ICAO and in the OPSP forum is a clear indication of

Australia's leading status in the world aviation arena.

Separation and Airspace Safety Panel (SASP)

SASP is responsible for the development of ATC standards and separation minima based on models and agreed Target Levels of Safety (TLS). The work of the panel in 2005 and 2006, as presently scheduled, is to continue to focus on the development of provisions for: air traffic control (ATC) separation minima for use with automatic dependent surveillance — broadcast (ADS-B); longitudinal distance-based separation minima for global navigation satellite systems (GNSS)- equipped aircraft; horizontal separation minima less than 56 km (30 NM) for appropriately approved RNP aircraft; and separation minima and procedures for use in association with highly accurate aircraft navigation systems in terminal control areas (both radar and non-radar).

Australia has had a high level of participation in SASP's development of a 'radar like" separation minima using ADS-B and a PANS ATM Doc 4444 amendment detailing the separation minima and operational procedures. Australia is also active in the SASP preparation of a safety "roadmap" for nations to develop an ADS-B Implementation Safety Case.

SASP is now refocusing its activities to developing uniform system wide approaches to ATM safety management including the safety metrics used.

CASA is a member of the team formed for this approach which will include the harmonisation of safety indicators, development of predictive indicators, setting of safety targets and guidance to States on acceptable levels of safety.

Appendices

Operating Statistics

Aerodromes

Table 12: Aerodromes, 2003-04 to 2004-05 (a)

J - ’ - > J; ^ -

Certified 3 20

Registered 43 108

Transitioning (b) 210 128

Total 256 256

Note: Under the new CASR Part 139, aerodromes are certified, registered or hold 'other' status as an aeroplane

landing ground. Transitional provisions apply to aerodromes that were licensed when the new legislation came into

effect on 2 May 2003. (a) As at 30 June 2004 (b) Former licensed aerodromes moving towards certified,

registered or other status under CASR Part 139.

Table 13: Aircraft Registrations, 2001-02 to 2004-05

| |

Initial registrations 391 445 487 497

Changes of registration holder 1 088 1 237 1 176 567

Changes of property interest holder 1 840 1 563 1 611 678

Cancellation of registration 212 313 256 258

Change of registration mark (a) 89 60(b) 11 87

Reservation of mark 1 201 668(b) 1 440 1027

Re-issue of certificates of registration (c) 1 503 1 899 1 261 1490

Aircraft registered as at 30 June 11 779 11 911 12 160 12401

Marks reserved as at 30 June 958 838 1 098 954

a) Due to the certificate of registration holder ceasing to be an entitled person, dying/ceasing to exist or notifying C/tS-4 that they no longer wish to be the certificate of registration holder, b) No changes of registration mark or reservations of mark were processed between 22 February and 30 June 2003.

c) Due to changes of address, loss etc

Table 14: Airworthiness Directives, 2004-05

Foreign Airworthiness Directives processed 980

Australian Airworthiness Directives 607

New issue 330

Cancellation 44

Amendment 233

Normal 456

Urgent 151

Australian unique 14

Based on foreign airworthiness directive 388

<§)

Table 15: Certification/airworthiness certificates, authorisations and approvals, 2001-02 to 2004-05

Type Certificate

Aeroplanes 1 2 4(a) 4(a)

Lighter than air 1 1 1 3

Rotorcraft 0 0 0 1

Sub-total 2 3 5 8

Type acceptance certificate

Aeroplanes 25 26 21 16

Lighter than air 19 3 5 2

Rotorcraft 4 10 4 6

Sub-total 48 39 30 24

Other authorisations, certificates and approvals

Special Flight Authorisation 13 2 4 22

Supplemental Type Certificate 13 15 25 11

Australian Parts Manufacturer Approval,b) 6 2 12

Australian Technical Standard Order 3 1 4 5

Authorisation

Special Flight Permit 0 2 17 1

Experimental Certificate 32 29 50 36

Production Certificate 0 0 3

Exclusions against Airworthiness Directives 6 13 20 148

CASR 21.133(2B) Production Certificate 1

ΑΡΜΑ Variations 6

Other Production Approvals 1

a) Includes amendments to Type Certificate Data Sheets

b) This figure is for initial issues only. It does not reflect the level of activity; for instance, Aerostructures and Plastics now have some 500 different parts and it is common to process them in batches of about 20 to 40.

Air Traffic Control Licensing

Table16: Air Traffic controller licences/ratings, 2003-04 to 2004-05

Licences 47 186 38 14

Ratings 132 237 66 13

Note: CASA assumed responsibility for Air Traffic Services licences and ratings with the coming into effect ofCASR Part 65 on 1 May 2003.

Transitional provisions applied to existing holders of licences and ratings.

a) Initial issue under CASR Part 65.

b) These are licences issued prior to CASR Part 65 commencement date that have been exchanged at holder request for a CASR Part 65 Licence.

Appendices

Flight operations and personnel

Table 17: Air Operator’s Certificates (a) 2003-04 to 2004-05

■Initial Issue 82 1 71 1Subsequent Issue 231 3 197 8Subsequent Issue with Variation 5 6 4 4Variation 288 79 245 68Total 606 89 517 81Current certificates (d) 921 31 859 27a) Includes operators involved in one or more of aerial work, charter, charter (cargo), flying training, foreign aircraft (passengers and cargo), foreignaircraft (cargo), scheduled cargo services, scheduled passenger services, unmanned aerial vehicles, b) Processed by the CASA Service Centre. Includes some low-capacity regular public transport operators.c) Processed by 0Λ5Λ Airline Offices.d) As at 30 June 2005.Table 18: Flight crew licensing examinations in 2004-05 Australian flight crew licensingAustralian Transport Pilots LicenceAir Law - Aeroplane and Helicopter AALW 518 141 659 78.6%Aerodynamics & Aircraft Systems - Aeroplane AASA 416 210 626 66.45%Aerodynamics & Aircraft Systems - Helicopter AASH 43 14 57 75.44%Flight Planning - Aeroplane AFPA 412 251 663 62.14%Flight Planning - Helicopter AFPH 34 4 37 91.89%Human Factors - Aeroplane and Helicopter AHUF 501 69 570 87.89%Meteorology - Aeroplane and Helicopter AMET 500 39 539 92.76%Navigation - Aeroplane and Helicopter ANAV 435 168 603 72.14%Performance and Loading - Aeroplane APLA 426 96 522 81.61%Performance and Loading - Helicopter APLH 30 6 36 83.33%Sub-total - - 4312 ■Commercial Pilot LicenceAerodynamics - Aeroplane CADA 786 459 1245 63.13%Aerodynamics - Helicopter CADH 175 93 268 65.3%Operations, Performance and Flight Planning CFPA 672 407 1079 62.28%-AeroplaneOperations, Performance and Flight Planning CFPH 157 97 254 61.81%- HelicopterHuman Factors - Aeroplane and Helicopter CHUF 967 276 1243 77.8%Flight Rules and Air Law - Aeroplane CLWA 742 332 1074 69.09%Flight Rules and Air Law - Helicopter CLWH 176 117 293 60.07%Meteorology - Aeroplane and Helicopter CMET 954 241 1195 79.83%Navigation - Aeroplane and Helicopter CNAV 856 155 1011 84.67%

Table 18: Flight crew licensing examinations in 2004-05 (continued)

Australian flight crew licensing continued

Commercial Pilot Licence continued

Aircraft General Knowledge - Aeroplane CSYA 831 271 1102 75.41%

Aircraft General Knowledge - Helicopter CSYH 172 75 247 69.64%

Sub-total - - 9011 -

Private Pilot Licence

Aeroplane Overseas Conversion PAOS 61 20 81 75.31%

Helicopter Overseas Conversion PHOS 3 3 6 50.0%

Private Pilot Licence - Aeroplane PPLA 1284 426 1710 75.09%

Private Pilot Licence - Helicopter PPLH 61 42 103 59.22%

Sub-total 1900

Various ratings

Grade 1 Flying Instructor AFR1 75 29 104 72.12%

Agricultural Pilot AGRC 19 0 19 100.0%

Command Instrument Rating IREX 727 368 1095 66.39%

Private Instrument Flight Rules PIFR 17 11 28 60.71%

Sub-total - - 1246 -

Total 16469 -

Table 19: Flight crew licensing examinations (a) summary for 2001-02 to 2004-05

Air Transport Pilot Licence 5613 54.4 4030 71.1 4271 72.9 4312 26.2

Commercial Pilot Licence 3697 60.9 9012 70.8 9422 69.2 9011 54.7

Private Pilot Licence 3523 74.8 1946 76.3 1897 75.3 1900 11.5

Various ratings 1450 51.0 1243 68.3 1121 66.0 1246 7.6

Total 14283 60.8 16231 71.4 16711 70.6 16469

a) Australian flight crew examinations only.

b) The statistics for 2001-02 include examinations conducted under the ExamFax system, which was phased out between April 2001 and March 2002.

Appendices

Table 20: Flight crew licences, issued and current (a) 2001-02 to 2004-05

Aeroplane

Air Transport 373 6028 332 6103

Commercial 804 1303 670 4220

Private 1342 15498 1134 15014

Student General Flying Progress Tests

1628 4564 1476 4449

Sub-total 4625 31395 4198 30676 4147 30390 3612 29786

Helicopter

Air Transport 53 429 33 433

Commercial 249 930 185 955

Private 102 376 78 388

Student General Flying Progress Tests

10 41 11 43

Sub-total Other

420 1634 363 1168 414 1776 307 1819

Commercial Balloon (b) 3 90 6 90

Flight Engineer 252 247

Restricted Flight Engineer (c)

738 754

Sub-total 24 1131 20 744 3 1080 6 1091

Total 5069 34160 4581 33088 4564 33156 3925 32696

a) Current figures are as at 30 June of the relevant year, show only the highest level of licence held and include only those pilots who

had a current medical certificate enabling them to exercise the privileges of the licence.

b) Balloon total current for 2004/2005 is an approximation only

c) Flight Engineers may also hold another flight crew licence and will be included in both figures

Maintenance Organisation and Personnel

Table 21 - Certificates of Approval (a) 2003-04 to 2004-05

Initial Issue 31 3 42 4

Subsequent Issue 77 16 54 16

Subsequent Issue with Variation 3 7 3 2

Variation 129 41 111 27

Total 240 67 210 49

Current certificates (d) 671 43 671 60

a) Includes organisations involved in one or more of aircraft and component maintenance, design (aircraft, components and materials), distribution (components and materials), aircraft maintenance engineer training and examinations.

b) Processed by the CASA Service Centre, c) Processed by CASA Airline Offices.

d) As at 30 June 2005.

Table 22: Aircraft maintenance examinations, 2003-04 to 2004-05

Scheduled examination sittings 5362 5857

Special examination sittings (a) 1328 1451

Category Technical Competency 161 224

Examinations (b) Weight Control Authority Examinations 21 16

a) Special examination sittings may be approved for individuals who are unable to sit an examination at a scheduled sitting date and have a particular reason to sit for an examination for the issue of an AME licence.

Training organisations may also seek special sittings to coincide with completion of their courses, b) These examinations are for Australian Defence Force and overseas licence holders only.

Table 23: Aircraft maintenance engineer licences/ratings, 2001-02 to 2004-05

Category Technical Competency 150 125 123 143

Assessment Trans Tasman Mutual Recognition 17 16 15 14

Assessment Licence/rating

Aircraft Maintenance Engineer Licences 270 239 198 224

- initial issue Practical Consolidation Training 512 2961 581 490

- Specific (a) Type ratings issued Current aircraft maintenance engineer 6106 6222 6274 6274

licences (a) Airworthiness/welding authorities Examiner authorities - initial issue 7 5 12 15

Maintenance authorities 306 298 230 250

Non Destructive Testing authorities 35 28 34 27

Weight Control authorities 3 9 9 5

Welding authorities 7 4 7 4

Current airworthiness/welding authorities (a) 1795 1822 1785 1791

a) As at 30 June 2005.

Table 24: Training Course approvals, 2001-02 to 2004-05

Specific type aircraft 30 23 12 28

theory course approvals Practical training courses 8 7 9 11

Medical

Table 25: Medical certificates, 2001-02 to 2004-05

Class 1: Professional pilots and flight engineers 2153 16174 41 1962 16011 17 2130 16365

Class 2: Student, private and commercial balloon pilots

6783 23279 65 6242 23002 38 6519 23191

Class 3: Air traffic control and flight service officers 40 587 3 57 746 2 87 653

Total 8976 40040 109 8261 39759 57 8736 40209

Fail Issued

39 24580

5 737

66 40475

Fail

a) Due to changed reporting arrangements, initial and renewal data is amalgated for the 2004-2005 reporting period

Enforcement

Table 26: Licence and certificate (a) action, 2001-02 to 2004-05

Show cause notices issued 61 31 26 42

Conferences held 28 16 11 14

Variations 7 3 1 0

Suspensions 16 5 8 5

Cancellations 21 11 8 13

Other enforcement action (b) 24 59 56 53

a) Does not include action in relation to medical certificates (see Table 27),

b)This includes counselling undertaken as a result of a show cause process, and informal enforcement action such as counselling and recommendations for remedial training taken as an initial response to a legislative breach.

2001-02 2002-03 2003-04 2004-05

Suspension Cancellation Suspension Cancellation Suspension Cancellation Suspension Cancellation

Table 28: Infringement notices and prosecutions, 2002-03 to 2004-05

Infringement notices issued 23 46 (a) 79

Matters referred to the Director of Public Prosecutions 15 15 21

Prosecutions finalised 15 20 16

Acquittals 2 5(b) 5

Convictions 13 15 10

(a) The issue of Infringement Notices is linked to the Demerit Points Scheme, which was established on 21 February 2004. Demerit points are incurred in relation to offences committed since that date where the penalty specified in the infringement notice has been paid (in whole or part) or the holder is convicted or found guilty of the offence, (b) One matter was withdrawn.

Table 29: Staffing 2004-05

Approved establishment (a) 736 733 734 732

Total staff (b) 692 707 701 683

Average staffing level 673 699 689 672

a) Approved establishment does not include project-funded positions,

b) As at 30 June each year. Excludes staff temporarily employed through agencies. Includes inoperative employees and employees occupying project-funded positions.

Table 30: Staff by classification, physical location and region as at 30 June 2005

Administrative Officer 144 88 5 9 5 2 22 17

Air Traffic Specialist 5 0 0 0 0 0 0 0

Airways & Aerodrome 7 14 2 2 1 0 2 3

Inspector Airworthiness Inspector 58 103 6 8 4 4 24 26

Flying Operations Inspector 26 87 5 9 4 3 24 16 Investigator 3 5 1 0 0 0 2 0 Legal Officer 7 4 1 0 0 0 1 1 Medical Officer 2 0 0 0 0 0 0 0 Public Affairs Officer 10 0 0 0 0 0 0 o Senior Manager 16 9 1 1 0 0 3 1 Senior Officer 77 15 0 0 0 0 9 2 Technical Officer 3 0 0 0 0 0 0 0 Total 358 325 21 29 14 9 87 66 2004 374 327 21 27 17 9 88 67 2003 385 322 24 27 18 9 81 66 2002 353 339 26 28 17 21 76 66 Vic/Tas West

Table 31: Age analysis by classification as at 30 June 2005

■ E - H

Administrative Officer 13 51 69 56 41 2

Air Traffic Specialist 0 0 1 2 2 0 5

Airways & Aerodrome 0 0 3 8 9 1 21

Inspector Airworthiness Inspector 0 5 30 50 69 7 161

Flying Operations Inspector 0 2 15 43 50 3 113

Investigator 0 0 4 4 0 0 8

Legal Officer 0 1 1 5 4 0 11

Medical Officer 0 0 0 2 0 0 2

Public Affairs Officer 0 3 2 5 0 0 10

Senior Manager 0 0 4 11 10 0 25

Senior Officer 0 10 22 34 25 1 !92

Technical Officer 0 0 1 0 2 0 3

Total 13 72 152 220 212 14 683

% of total staff 1.9% 10.54 22.25% 32.21% 31.04% 2.05% 100

2004 2.1 11.3 23.0 33.2 29.5 0.9 100

2003 2.8 11.9 25.3 32.3 26.7 1.0 100

2002 2.6 12.7 24.1 35.0 24.6 1.0 100

Table 32: Equal em ploym ent opportunity staffing statistics by classification as at 30 June 2005

BE' ■

■

Administrative Officer 4 0 10 5 0 9 28

Air Traffic Specialist 0 0 0 0 0 0 0

Airways & Aerodrome Inspector 0 0 1 0 0 0 1

Airworthiness Inspector 5 0 6 0 0 1 12

Flying Operations Inspector 2 0 3 0 0 0 5

Investigator 0 0 0 0 0 0 0

Legal Officer 2 0 1 0 0 0 3

Medical Officer 0 0 0 0 0 0 0

Public Affairs Officer 0 0 0 0 0 0 0

Senior Manager 2 0 1 0 0 0 3

Senior Officer 3 0 5 4 0 4 16

Technical Officer 0 0 0 0 0 0 0

Total 18 0 27 9 0 14 68

Total

2005 18 0 27 9 0 14 68

2004 18 0 33 8 0 20 79

2003 22 0 23 7 0 11 63

2002 22 0 14 8 0 10 54

Note: Only 44% of current staff have voluntarily completed EEO forms

Appendices

Table 33: Staff Classification as at 30 June 2005

Male Female

Administrative Officer 71 0 155 6 232 69.4%

Air Traffic Specialist 5 0 0 0 5 0.00%

Airways & Aerodrome Inspector 20 0 1 0 21 4.76%

Airworthiness Inspector 159 0 1 1 161 1.24%

Flying Operations Inspector 111 1 1 0 113 0.88%

Investigator 8 0 0 0 8 0.00%

Legal Officer 11 0 0 0 11 0.00%

Medical Officer 2 0 0 0 2 0.00%

Public Affairs Officer 5 0 5 0 10 50.00%

Senior Manager 22 0 3 0 25 12%

Senior Officer 62 1 26 3 92 31.52%

Technical Officer 3 0 0 0 3

Total 479 2 192 10 683 29.58%

Table 34: Salary ranges under the 2002-05 Certified Agreement

Classification Level Salary Range at 30 Jun 2005

Administrative Service Officer Class 1 $30,958 to $35,755

Administrative Service Officer Class 2 $35,036 to $40,600

Administrative Service Officer Class 3 $39,907 to $45,006

Administrative Service Officer Class 4 $44,478 to $50,463

Administrative Service Officer Class 3/4 $39,907 to $50,463

(Airline and Area Offices and Regulatory Services Division)

Administrative Service Officer Class 5 $49,610 to $54,966

Administrative Service Officer Class 6 $53,579 to $64,317

Senior Officer 1 $69,022 to $76,461

Senior Officer 2 $76,064 to $92,269

Technical Officer Level 1 $36,230 to $39,770

Technical Officer Level 2 $39,348 to $47,325

Technical Officer Level 3 $46,196 to $54,774

Technical Officer Level 4 $53,579 to $62,571

Senior Technical Officer Grade C $69,022 to $76,461

Senior Technical Officer Grade B $76,064 to $88,987

Public Affairs Officer Grade 1 $45,889 to $54,966

Public Affairs Officer Grade 2 $55,809 to $66,272

Public Affairs Officer Grade 3 $71,235 to $82,542

Senior Public Affairs Officer Grade 1 $85,155 to $88,987

Senior Public Affairs Officer Grade 2 $88,879 to $93,924

Information Technology Officer Class 1 $43,068 to $50,463

Information Technology Officer Class 2 $53,579 to $64,317

Legal Officer Class 1 $37,454 to $60,110

Legal Officer Class 2 $69,022 to $82,542

Legal Officer Class 3 $86,678 to $94,805

Table 34: Salary ranges under the 2002-05 Certified Agreement (continued)

Classification Level Salary Range at 30 Jun 2005

Professional Officer Class 1 $41,113 to $54,774

Professional Officer Class 2 $53,579 to $62,571

ATS Operations Officer $73,167 to $79,509

ATS Manager 1 $78,986 to $88,987

ATS Manager 2 $88,296 to $92,269

ATS Manager 3 $94,526 to $98,780

ATS Manager 5 $98,599 to $103,035

ATS Manager 6 $104,077 to $138,266

Medical Officer Class 1 $69,022 to $87,621

Medical Officer Class 2 $87,832 to $95,469

Medical Officer Class 3 $94,648 to $102,264

Medical Officer Class 4 $103,820 to $118,268

Medical Officer Class 5 $120,489 to $125,910

Airworthiness Officer/Inspector/Engineer 1 $75,735 to $90,298

Airworthiness Officer/Inspector/Engineer 2 $94,958 to $99,618

Airworthiness Officer/Inspector/Engineer 3 $104,324 to $104,324

Aerodrome Inspector 1 $69,908 to $84,473

Aerodrome Inspector 2 $90,298 to $90,298

Investigator 1 $69,908 to $84,473

Investigator 2 $90,298 to $90,298

Airways and Aerodrome Engineer 1 $75,735 to $90,298

Airways and Aerodrome Engineer 2 $94,958 to $94,958

Airways and Aerodrome Engineer 3 $99,168 to $99,168

Flying Operations inspector (General Aviation) $86,678 to $105,190

Flying Operations Inspector (Airlines)* $97,820 to $115,854

Team Leader - Flying Operations Inspector (General Aviation) $95,421 to $113,934

Team Leader - Flying Operations Inspector (Airlines)* $106,564 to $124,598

Flying Operations Inspector - Standards Development (General Aviation) $89,763 to $105,190

Flying Operations Inspector - Standards Development (Airlines) $97,820 to $115,854

Manager - Standards Development $106,564 to $124,598

Cadet rates -full-time study $10,127 to $17,242

Cadet rates - practical training $17,903 to $34,462

* Loadings in addition to base salary are payable for endorsements held by Flying Operations Inspectors.

These loadings range from $6,558 to $65,578

s Consultants, contractors and legal expenses Consultants and contractors

Payments made to service contractors and consultants during 2004-05 are listed in Table 35

Table 35: Service contractors and consultants, 2004-05

Vendor Nature and purpose

Accenture Australia Holdings Pty Ltd

Acumen Alliance

Acumen Alliance

Acumen Alliance

Acumen Alliance

Acumen Alliance

Acumen Alliance

Airservices Australia

Alpha Multimedia

Amaroo Associates Pty Ltd

Asia Pacific Aviation Consultants

Australian National Audit Office

Aviation Theory Centre

Axiom College Pty Ltd

Barbara Yeoh & Associates

Bruce Malcolm Davis

Carol L Durkin

Civil Aviation Authority NZ

Colliers International Consultancy

Connected Learning Pty Ltd

CPM Group Pty Ltd

CASA Improvement Program

Review of Aviation Medicine Function

Audit Programs

Corporate Accountant

Project Manager Long Term Funding Strategy

Project Manager Change Management

Analysis of CASA Aircraft Register

ICAO Representative

Instructor Pack - Operations in and Around Controlled Airspace

Financial Viability Services

Chair SCC Meetings

Financial Statements Audit

Instructor Pack - Operations in and Around Controlled Airspace

Training - Certificate IV in Assessment and Workplace Training

Services as Chair Audit Committee - Barbara Yeoh

CyberExams Question Bank

Aviation Safety Forum

Aviation Locum

FBT Carpark Valuation

Training - Workplace Writing Skills

Training - Best Practice in Project Management

Amount

$7,853,439

$12,672

$259,393

$59,150

$123,477

$108,500

$15,008

$87,217

$27,761

$38,827

$43,905

$64,000

$12,590

$24,300

$28,785

$19,690

$30,000

$13,040

$13,050

$16,118

$21,818

Appendices

Table 35: Service contractors and consultants, 2004—05 (continued)

Vendor

Decision Management System

Department of Transport and Regional Services

Dr James Ross

DSI Consulting

Dun & Bradstreet

Effective People

EPSRC Solutions Pty Ltd

Flight Medicine Systems

Freelance Consulting Services

Hays Personnel

Icon Recruitment Pty Ltd

Inthink Pty Ltd

Inthink Pty Ltd

Inthink Pty Ltd

ISM Group Pty Ltd

Kellaway Pty Ltd

Kordamentha Pty Ltd

KPMG Australia

Kyriakidis Recruitment Services

LPC Australia Pty Ltd

MAAS Corporation

Manpower Services Australia Pty Ltd

MKL Consulting Pty Ltd

Montage Productions Pty Ltd

Nature and purpose

Development, Implementation & Support of CASA Computer Environment

ICAO Representative

Antidepressant Study

Safety Assessment Study for NAS 2B

Risk Management Subscription

Review of International Activities

Rehabilitation Case Management

Guest Speaker - Aviation Safety Forum

Development, Implementation & Support of CASA Computer Environment

Recruitment Services

Development, Implementation & Support of CASA Computer Environment

Guest Speaker services

Development & Delivery of CBT Program

CTE Implement Strategy

Development, Implementation & Support of CASA Computer Environment

Development, Implementation & Support of CASA Computer Environment

Chief Financial Controller

Audit Programs

Recruitment Services - Executive Manager Selection

Property Management Fees

Development, Implementation & Support of CASA Computer Environment

Aviation Locum

Services on Audit Committee

Instructor Pack - Operations in and Around Controlled Airspace

Amount

$46,750

$181,465

$15,352

$23,800

$10,950

$17,550

$83,894

$10,206

$84,508

$22,961

$77,454

$10,700

$32,687

$11,780

$212,481

$227,144

$52,046

$495,199

$80,002

$21,252

$108,589

$19,523

$13,589

$27,320

Table 35: Service contractors and consultants, 2004-05 (continued)

Vendor

National Safety Council of Australia Ltd

Nature and purpose

Training - Certificate IV in Assessment and Workplace Training

Netlmpact Online Publishing

New Horizons Learning Centre

Peoplebank Australia Pty Ltd

Phillips Fox

Pinpoint Solutions

Pratt & Whitney Canada International Inc.

Property Concept & Management

Sirius Telecommunications

Southpac Aerospace Trust

Spencer Stuart & Associates

St John of God Corporate Health Services

Stopline Pty Ltd

Surpetitive Consulting Pty Ltd

Temla Limited Partnership

Trend Software Pty Ltd

Verossity Pty Ltd

Wordware

Workplace Research Association

Workplace Solutions

Total Service Contractor and Consultancy Costs

CD-ROM Library

Training - Certificate IV in Assessment and Workplace Training

Development, Implementation & Support of CASA Computer Environment

Governance Review

Risk Review Workshop

Training - ECTM Windows

Tenant Advocate for Head Office Accommodation

Provision of telephonist and reception services

Training - Safety and Lead Auditor

Recruitment Services - Executive Manager Selection

Staff Counselling

Disclosure Management Services

Development, Implementation & Support of CASA Computer Environment

Development, Implementation & Support of CASA Computer Environment

Development, Implementation & Support of CASA Computer Environment

Development, Implementation & Support of CASA Computer Environment

Development and Maintenance of CASA Manuals

Work Level Standards Task

Rehabilitation Assessment

Amount

$26,700

$160,710

$14,450

$367,579

$50,150

$84,619

$19,291

$19,600

$210,161

$27,450

$145,682

$28,277

$18,000

$47,860

$26,973

$20,376

$174,237

$183,759

$29,773

$10,623

$12,426,211

Note: Expenditure relates to amounts greater than $10,000. Excludes GST. Contractors and consultants employed in projects are included in this listing.

Table 36: Legal Costs

Legal costs CASA paid during 2004-05 are listed in Table 36.

Administrative Appeals Tribunal $662

Attorney General's Department $9,893

Brett Shields $22,605

Farid Assaf $8,700

Federal Court of Australia $7,549

Ian Harvey $129,120

Mallesons Stephen Jacques (Canberra) $145,737

Paul Brereton $28,269

Phillips Fox $135,598

PJ Roberts $7,500

Stephen Gageler $3,878

Total legal costs (a)$499,511

Note: Excludes GST and disbursements

Glossary

AA Airservices Australia

AAT Administrative Appeals Tribunal

AC Advisory Circular

AD Airworthiness Directive

ADS-B Automatic Dependent Surveillance Broadcast AIRS Aviation Industry Regulatory System AOC Air Operator's Certificate

ATOG Air Transport Operations Group

ATM Air Traffic Management

ATSB Australian Transport Safety Bureau ASTRA Australian Strategic Air Traffic Management Group

CAAP Civil Aviation Advisory Publication

CAO Civil Aviation Orders

CAR Civil Aviation Regulation 1988

CASR Civil Aviation Safety Regulation

CEO Chief Executive Officer

COA Certificate of Approval

COO Chief Operating Officer

DOTARS Department of Transport and Regional Services

EASA European Aviation Safety Agency FAA Federal Aviation Administration

FOI Freedom of Information

GOAG General Aviation Operations Group

GPS Global Positioning System

ICAO International Civil Aviation Organization

ISG Information Services Group

IT Information Technology

KPMG Klumzeld Peat Marwick Goerdeler (Chartered Accountants and Management Consultants)

LARP Licencing Aircraft Registration and Publications LTFS Long Term Funding Strategy

MCANTO Manufacturing, Certification and New Technologies Office

MOS Manuals of Standards

NPRM Notices of Proposed Rulemaking

OH&S Occupational Health and Safety

ORR Office of Regulation Review

PASO Pacific Aviation Safety Office

PIR Post Implementation Review

PLET Personnel Licensing and Training

RAAF Royal Australian Air Force

RIS Regulation Impact Statements

RNAV Area navigation

RNP Required navigation performance

RRP Regulatory Reform Program

see Standards Consultative Committee

UAV Unmanned Aerial Vehicle

C A S A A n n u a l R e p o r t 2 0 0 4 - 2 203

Compliance Index

Advertising and Market Research CAC Orders 2002, clause 17, ref

Commonwealth Electoral Act 1918, section 311A

116

Audit Committee CAC Orders 2002, clause 15 65-66

Certification Commonwealth Authorities and Companies

Orders 2002, clause 4

Clear links between outcomes, strategies for achieving those outcomes and the principal outputs

CAC Orders 2002, subclause 10(2)(b) 60-61

Commonwealth disability strategy Commonwealth Disability Strategy 109-111

Directors CAC Orders 2002, clause 14 60-61

Ecological, sustainable development and environmental performance CAC Order 2002, clause 17, ref Environmental Protection and Biodiversity

Conservation Act 1999, section 516A

109

Effects of Ministerial directions and notification of general policies of the Government CAC Orders 2002, subclause 12(1)(a-b), (2) 64

Efficiency and effectiveness of the operations in producing its principal outputs CAC Orders 2002, subclause 10(2)(a) 21-57

Enabling legislation, functions and objectives CAC Orders 2002, clause 8 5,104

Exemptions to requirements for financial statements CAC (Financial Statements 2001-2002) Orders

NIL

Factors, events or trends influencing performance CAC Orders 2002, subclause 10(1 )(b) 22-25

Financial statements Subclause 1 (b) and subclause 2(1) of

Schedule 1 to the CAC Act

125-170

Financial statements certification: a statement, signed by the directors Subclause 2(3) of Schedule 1 to the CAC Act

124

Financial statements certification: Auditor-General's Report Subclause 1 (c) of Schedule 1 to the CAC Act

122-123

Fraud risk assessment and control Commonwealth Fraud Control Guidelines 2002 70

Freedom of Information CAC Orders 2002, clause 17, ref FOI Act

subsection 8(1)

104-108

Indemnities and insurance premiums for officers CAC Orders 2002, clause 16 112-113

C A S A A n n u a l R e p o r t 2 0 0 4 - 2 205

Requirement Reference for requirement Reference in

Report

Judicial decisions and decisions of administrative tribunals that have had, or may have, a significant impact on operations

Location of major activities and facilities

Ministerial directions on performance of functions, exercise of powers

Ministerial directions regarding documents and information

Ministerial directions regarding reporting

Notification of Minister's views

Occupational Health and Safety

Operational and financial results during the year, including principal outputs, major investing activities, key financial and non-financial activities

Organisational structure

Responsible Minister(s)

Review of performance

CAC Orders 2002, clause 11 103

CAC Orders 2002, clause 9 117-119

CAC Orders 2002, subclause 12(1)(a), ref Civil Aviation Act, sections 12 and 49 64

CAC Orders 2002, subclause 12(1)(a), ref Civil Aviation Act, sections 12B and 49 64

CAC Orders 2002, Subclause 12(1)(a), ref Civil Aviation Act, Sections 12D and 49 64

CAC Orders 2002, subclause 12(1)(a), ref Civil Aviation Act, sections 12A and 49 64

CAC Orders 2002, clause 17, ref OH&S(CE) Act, section 74 112

CAC Orders 2002, subclause 10(1 )(d) 21-57,

125-170

CAC Orders 2002, clause 9 13

CAC Orders 2002, clause 8 64

CAC Orders 2002, subclause 10(1 )(a) 6-12, 21-57

Significant changes in state of affairs or principal CAC Orders 2002, subclause 10(1 )(e) 102 activities during the financial year.

Significant developments since end of the financial CAC Orders 2002, subclause 10(1 )(f) 102 year

Significant events per s15 CAC Act CAC Orders 2002, subclause 10(1 )(c) 102

Figures and Tables

Figures

Figure 1: Location of CASA Offices 4, 117

Figure 2: Financial Performance Trends 7

Figure 3: Components of Revenue 2004-05 7

Figure 4: Components of Expenditure 8

Figure 5: Financial Position Trends 9

Figure 6: CASA's organisational structure 6

Figure 7: CASA's Performance Framework 23

Figure 8: General Aviation Accidents per 100 000 hours flown 1995-2004 26

Figure 9: General Aviation Fatal Accidents per 100 000 hours flown, 1995-2004 26

Figure 10: On-time issue of Air Operator's Certificates and Certificates of Approvals 46

Figure 11: Industry satisfaction with regulatory services 52

Figure 12: Compliance Audits - General Aviation 54

Figure 13: General Aviation Safety Trend Indicator "desktop" audits 54

Figure 14: Compliance audits - Airline Operations 54

Figure 15: Compliance audits - Aviation Infrastructure and Sports Aviation 55

Figure 16: Male/Female ratio - 30 June 2005 55, 77

Figure 17: Gender split by job families 77

Tables

Table 1: Coronial inquiries 2001-02 to 2004-05 95

Table 2: Administrative Appeals Tribunal - Merits review of regulatory decisions 2001-02 to 95 2004-05

Table 3: Categories of CASA's decisions that were appealed to the Administrative Appeals 96 Tribunal

Table 4: Federal Court - applications for judicial review of regulatory decisions 2001-02 to 97 2004-05

Table 5: Freedom of information 2001-02 to 2004-05 99

Table 6: Time taken to make decisions on Freedom of Information Matters 99

Table 7: Internal CASA review of Freedom of Information decisions 99

Table 8: Media costs 2004-05 114

Table 9: Direct Mail costs 2004-05 115

Table 10: Advertising costs 2004-05 116

Table 11: New Legislative change projects initiated 180

Table 12: Aerodromes 2003-04 to 2004-05 184

Table 13: Aircraft registrations 2001-02 to 2004-05 184

Table 14: Airworthiness Directives 2004-05 184

C A S A A n n u a l R e p o r t 2 0 0 4 - 2 0 0 5 201

Table 15: Certification/airworthiness certificates, authorisations and approvals 2001-02 to 185 2004-05

Table 16: Air Traffic Controller licences/ratings 2003-04 to 2004-05 185

Table 17: Air Operator's Certificates 2003-04 to 2004-05 186

Table 18: Flight Crew License examinations in 2004-05 186

Table 19: Flight Crew Licence examinations summary for 2001-02 to 2004-05 187

Table 20: Flight Crew Licences issued and current 2001-02 to 2004-05 188

Table 21: Certificates of Approvals 2003-04 to 2004-05 188

Table 22: Aircraft Maintenance Engineers Examinations 2003-04 to 2004-05 189

Table 23: Aircraft Maintenance Engineers licences/ratings 2001-02 to 2004-05 189

Table 24: Training course approvals 2001-02 to 2004-05 189

Table 25: Medical Certificates 2001-02 to 2004-05 190

Table 26: Licence and Certificate action 2001-02 to 2004-05 191

Table 27: Medical Certificate action 2001-02 to 2004-05 192

Table 28: Infringement notices and prosecutions 2002-03 to 2004-05 192

Table 29: Staffing profile 2004-05 193

Table 30: Staff by classification, physical location and region as at 30 June 2005 194

Table 31: Age analysis by classification as at 30 June 2005 195

Table 32: Equal Employment Opportunity staffing statistics by classification as at 30 June 2005 195

Table 33: Staff classifications as at 30 June 2005 196

Table 34: Salary ranges under the 2002-05 certified agreement 196

Table 35: Service contractors and consultants, 2004-05 198

Table 36: Legal Costs 201

Alphabetical index

A

Accenture Australia Holding Pty Ltd 88, 198

Accidents 112

Accident rates 30

Analysis 24, 26, 28, 32, 34,

General aviation 24, 26, 28

See also occupational health and safety

Addresses 117-119

Administrative Appeals Tribunal 25, 39, 95, 100, 201

Administrative Appeals Tribunal Act 1975 5

Administrative Decisions (Judicial Review) Act 1977 5

Administrative fines - see infringement notices

Advertising and market research expenditure 114

Advisory circulars 28, 80, 83, 181

Aerodromes 182, 184

Introduction of airbus 182

Operators 4, 40

Regulations and standards 40

Rescue and fire fighting services 4

Aerospace Industry action agenda 56

Air Navigation Act 1920 5

Air Navigation Commission 182

Air Operator's Certificate/s 186

Application processing 32, 46, 110

Holders of 3

Regulations and standards 173, 180

Air traffic

Controllers 110

Services 4

Airbus 182

Aircraft

Certification 41,83, 87, 185

Manufacturing and export 87, 180

Registration 3, 40, 184

Unmanned - see unmanned aircraft and rockets

Airline/s 186, 188

Audits 24, 32, 38, 53-55

Offices 37. 53, 117

Airservices Australia 40-41,68, 79, 96, 177, 198

Airspace

Regulations and standards 180

See also National Airspace System

Airspace Users Group 93

See also Standards Consultative Committee

Air Transport Operations Group 12-13

Airworthiness Directives 175

Regulations and standards 174

Statistics 184-185

Airworthiness/welding authorities 189

AOC/s - see Air Operator's Certificate/s

Area offices 117-119

Asia Pacific Planning and Implementation Regional Group 182

Audit/s

Australian National Audit Office 122-123

Internal 50, 65-67

Surveillance 24, 31-32, 37, 53-55

Audit and Risk Committee 65

Members 65, 172-173

Auditor-General's Report 122-123

Auditor-General Act 1997 5

Australian National Audit Office 122-123

Australian Transport Safety Bureau 68, 95

Australian workplace agreements 76

Aviation Fuel Revenue (Special Appropriation) Act 1988 145

Aviation Safety Forum 42, 78-79, 105, 198

Aviation Safety Foundation of Australia 32

B

Balloon licences 188, 190

Bilateral arrangements 42, 87

Board

Abolition of 64, 113

Building a New CASA 10-14, 30

C

CASA hotline 4, 69, 85

CASA Improvement Program 6, 46, 88, 198

Case management 40, 199

Certificate/s of Appoval 46, 96, 188

Applications processing 46

Holders of

Issued 188

Certification Standards Sub-committee 83

See also standards consultative committee 80

Certified agreement 17, 25, 35, 49, 70-71, 76, 196-197

Challenge 2

Change Implementation Team 14, 56

Charter letter 35, 41, 69-70, 93

Chief Executive Officer

Biography vii, ix

Directives 24, 27-29, 31, 37, 51, 81-84

Report v, iv

Responsibilities 65

Working arrangements 65

Chief Financial Controller

Chief Operating Officer

Biography 61

Responsibilities 65-67

Civil Aviation (Fees) Amendment Regulations 2003 176

Civil Aviation (Fees) Regulations 1995 18-19, 102, 145,

176

Civil Aviation Act 1988 5, 104

Changes 38, 173-174

Civil Aviation Amendment Act 2003 64, 113, 173

Civil Aviation (Carriers Liability) Act 1959 5, 113

Civil Aviation orders 5, 178-179

Civil Aviation Regulations 1988 5, 174-177

Civil Aviation Safety Regulations 1998 5, 11, 40, 174-177

COA - see Certificate of Approval

Code of conduct 35, 70

Comcover 56, 68, 139

Commonwealth Authorities and Companies Act 1997 5, 102-103, 112, 134

Commonwealth Authorities and Companies Orders 134

Commonwealth Disability Strategy 109

Competitive tendering and contracting 114

Complaints 35, 37, 93

Conflict of interest 70

Consistency

Regulatory 35, 36, 55, 68

Consultancy expenditure 198-200

Consultation

Documents 110

Industry 24, 42, 51, 80-84

With staff 71

With stakeholders 105

Contact points 117, 118, 119

Convention and International Civil Aviation (Chicago Convention) 86

Coronial Inquiries 95

Corporate

Communications 85

Governance 50, 64-66, 92, 103

Plan/planning 22-23, 92

Cost

Recovery 6-7, 18-19, 47-48, 102, 176

Cross-agency activities 6

D

Demerit points scheme 38-39

Department of Finance and Administration 45, 140

Department of Transport and Regional Services 38, 41, 45, 47-48, 67, 78, 87-88, 103, 199

Direct mail expenditure 115

Director of Aviation Safety 64

See also Chief Executive Officer

Director of Public Prosecutions 38, 192

Directors 162

Disallowance of regulations 93

Discussion papers - see consultation documents

Documents, availability 106-108

E

Ecologically sustainable development 109

Electronic safety incident reports 32, 68

Effectiveness measures 11, 22, 26-56

Enabling legislation 5

Enforceable Voluntary Undertakings 25, 39

Enforcement

statistics 191-192

Enquiries about report iv

Environment Protection and Biodiversity Conservation Act 1999 109

Establishment review 14

European Aviation Safety Agency 25, 41,87

Examinations

Flight crew 186-187

Handbooks/syllabuses 107-108

Maintenance personnel 189

Executive responsibilities 65

Exemptions, from standards 29, 174, 177-178

F

FAA - see Federal Aviation Administration

Fatigue risk management

Federal Aviation Administration 41, 175

Federal Court of Australia 39, 97-98, 103, 201

Prohibition order 98

Review of administration decisions 97

Fee/s

Revenue 7, 125, 145, 170

Review of - see Cost Recovery

Increase in - see Cost Recovery

Financial performance 6-7

Financial statements 121-170

Flight crew

Examinations 186-187

Licences/ing 188

Flight Crew Licensing Standards Sub-committee 83

Fraud risk assessment and control 70

Freedom of information 99, 104, 105

Review 99

Statements 104-108

Statistics 99

Freedom of Information Act 1982 5, 104

Fuel excise 6-8, 45, 125, 169-170

Functions and powers 104

Ministerial directions and notification about 64

G

General aviation

Accidents/rates 14, 24, 26, 28, 30

Auditing 31-32, 37, 53-55

Inspectorate time in the field

Operators and organisations

Regulatory services 46, 186-188

Operations Group viii, 12-13, 53, 68

' A S A A n n u a l R e p o r t 2 0 0 4 - 2

κ

Greenhouse Gas Emission Reduction Strategy 109

H

Helicopters

Regulations and standards 177-180

See also licences and examinations

Human resources 12-13, 193-197

I

Incidents

Rates

Reports 32, 68, 85, 95

See also occupational health and safety

Indemnities 112-113, 132, 137, 160, 165

Industry satisfaction 52

Information Services Group 12-13, 57

Information technology 11, 89, 114, 131

Infringement notices 38-39, 192

Insurance - see also carrier's liability insurance 56, 112­ 113, 139

Internal audit 50, 67

international Civil Aviation Organization 86

CASA's portfolio involvement with 25, 41, 182

CASA participation on panels and working groups 182-183

Standards and recommended practices

International

Activities 182

Relations 86

See also International Civil Aviation Organization

J

JS McMillan 106, 114

Glossary 203

<§>

KPMG49, 68, 199

L

Learning and development strategy 71

Legal expenditure 201

Legal Services Group viii, 12-13

Legislative framework 5

Legislative change

Projects 180-181

Licences/ratings

Air traffic controllers 185

Flight crew 4, 186-188

Maintenance personnel 4, 189

Licensing, aircraft registrations and publications system 88

Location of CASA facilities - see also addresses 117­ 119

Long-term funding strategy 18, 45

see also cost recovery

M

Maintenance

Audits 31

Authorities 106

Organisations 12

Personnel examinations 189

Personnel licences/ing 189

Regulations and standards 180-181

Maintenance standards sub-committee 84

Management structure 66

Manuals, availability of, 106-108

Manufacturing, Certification and New Technologies Office viii, 12-13, 46

Manufacturing organisations 46

Media

Costs 114-116

Relations 85

Medical

Certification 25

Certificate action 96, 192

Regulations and standards 28

Minister for Transport and Regional Services 64

Accountability 67, 92, 102

Charter letter 35, 41, 69, 70, 93

Directions and notifications from 64

N

National Airspace System 5, 19, 48

O

Occupational Health and Safety 72, 111

Organisation Structure 13

P

Performance framework 22, 23

Personnel Licensing Education and Training Group viii, 1 2 -1 3

Portfolio

Budget statement 22, 44-45, 51, 176

Outcome 23, 168

Transport and regional services 12, 86-87

Probity 69

Prohibition order(s) 98

Prosecutions 192

Protected disclosure policy 50, 69

Q

Qantas Airways Limited 40

Quality management 89

R

Recreational Aviation Standards Sub-Committee 84

Regulator, objectives for CASA as 26-56

Regulation Impact Statements 105

Regulatory Reform Program viii, 5, 10-11,27-29, 33

Consultation documents 110

Update newsletters

Regulatory reform implementation 12, 29, 39-40, 51

Regulatory services 24, 46-47, 52, 109, 168

see also Cost Recovery

Requests for Corrective Action 68

Research

Safety 13, 30, 34

Revenue, see operating revenue

Review of regulatory decisions 95

Risk

Basis for standards 27

Management 19, 68

See also Audit and Risk Committee and fatigue risk

management

S

Safety standards report on - see also outputs 173-181

Safety promotion 13, 23, 30, 32-33

Safety Trend Indicator 31, 53-54, 57

See also risk

Scholarship program 42-43

Senate Rural and Regional Affairs and Transport Committee 93

Senior managers 62-63

Service centre 24, 46-47, 89, 94, 119, see also regulatory services

Significant changes and events 102

C A S A A n n u a l R e p o r t 2 0 0 4 - 2

Staff 73-78

Recognition scheme 72-74

Statistics 76, 103-107

Terms and conditions 76

Training 71

Turnover 78

Unplanned absences 77

Standards consultative committee 80

Sub-committees 83

Surveillance - see audits and compliances

Surveillance procedures manual 32, 53, 108

U

United Kingdom Civil Aviation Authority 41-42, 87

United States - see also Federal Aviation Administration

Unmanned aircraft and rocket operations 28, 84, 180

V

Values 2

Vision 2-3

W

Warbirds 180

Web site

Documents available on 96-98

Guidance material on 96-98

Regulatory reform 109

Whistleblower scheme 50, 69

Workforce planning 76

Workplace - see also occupational health and safety 72, 111-112

Workplace Diversity Sub-committee 76

Workplace Relations Group 72

Head Office CASA Building Cnr N orthbourne Avenue & Barry

Canberra City ACT 2601

■ GPO Box 2005 Canberra.City ACT

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