Note: Where available, the PDF/Word icon below is provided to view the complete and fully formatted document
 Download PDFDownload PDF 

Previous Fragment    Next Fragment
Rural and Regional Affairs and Transport Legislation Committee
24/02/2015
Estimates
INFRASTRUCTURE AND REGIONAL DEVELOPMENT PORTFOLIO
Airservices Australia

Airservices Australia

CHAIR: We will resume. Secretary Mrdak, I think you may have something that you would like to clarify, and perhaps table a document.

Mr Mrdak : Yes, Chair, if you do not mind. I have taken the opportunity with my office over the break to get some further advice to the committee on the issue of the European list of airlines. We will table that for you, and that makes it very clear that a number of the airlines we discussed are not on the European blacklist, including Garuda, but it does make clear those airlines which have been blacklisted in the European Union. There are, to my knowledge, no airlines flying to Australia which appear on that list. I will table that for the committee.

CHAIR: Thank you. I might as well start while you settle, Senator Xenophon. I want to go to Port Hedland, but before I do that, Mr Rodwell, what does the Executive General Manager, Projects and Engineering, do?

Mr Rodwell : My role is responsible for the oversight and coordination of our capital program activities. We have sponsors, who are the executive general managers, for each of the project domains. I work with those sponsors to actually deliver those projects. I also have responsibility for the oversight of our engineering areas, so specifically all of our navigation facilities that are scattered around Australia.

CHAIR: Thank you very much for that. Tell me what Mr Jason Harfield does.

Mr Rodwell : Jason Harfield is—

CHAIR: The allegation I have is that he has been given a job, but it is a no-man's-land job.

Ms Staib : Senator, would it be all right if I answered that?

CHAIR: Yes. As you know there is a bit of s-h-i-t going on.

Ms Staib : Thank you, Senator. Jason Harfield is the Executive General Manager, Future Service Delivery. That is the program delivering our new, replacement air traffic control system.

CHAIR: What is the difference between FSD and OneSKY?

Ms Staib : OneSKY is the name we give to the program replacing the national air traffic control system. We are working with Defence on that program, so we will, for the first time in this nation's history, have a single, national air traffic control system used by both the military and the civilian sector. Future Services Delivery looks after that as well as the transformation program. In other words, making sure that the whole organisation is ready for this most significant and important change.

CHAIR: Is that about a $400 million program?

Ms Staib : OneSKY you are talking about, Senator? That is the portion that is around about what is for Airservices. I am a bit careful about giving the specific numbers because we are in negotiation with the preferred tenderer, but it is in that order.

CHAIR: Do you use 457 visas?

Ms Staib : We have done, and we have some people on 457s.

CHAIR: Could you give us the details of those, on notice?

Ms Staib : Yes.

CHAIR: There was an allegation that some of those people are inappropriate. With the civil-military airwaves transformation, how do FSD and OneSKY weld that together?

Ms Staib : FSD is, as I said, looking after the program, which is called OneSKY—

CHAIR: This is what you call 'cutting to the chase', by the way.

Ms Staib : It also, as I said, looks after making sure we are ready. There are a number of other projects that have to be delivered. We have a joint program. We have Air Force people working in that team to deliver the program on behalf of Defence and Airservices.

CHAIR: We have been briefed on this and we have been through it. It seems quaint to me, but could you explain the supervision of air traffic in Adelaide being done from Melbourne?

Ms Staib : I think you are referring to the integration of our terminal control units or our radar approach—one in Adelaide into Melbourne and then Cairns into Brisbane. I will ask Mr Hood—

CHAIR: I am just trying to get my head around it. The average punter who flies into Adelaide would probably like to think that the air traffic controller is in that control tower area and that he can see that storm cloud over there and that plane that is too low over there. But, if it is someone in Melbourne and the camera is not focused on that particular sector—

Ms Staib : Traffic landing in Adelaide and taking off from Adelaide will continue to be controlled by our people in the tower. That is because you do need visual.

CHAIR: That is what I thought!

Ms Staib : You need to be able to see the aircraft. Where we are talking about is that intermediate stage of flight that is beyond visual contact. Our controllers already use surveillance radar to do that. Whether they are in Adelaide or in Melbourne, it is still perfectly safe to do that—because they will be using that surveillance picture.

CHAIR: Is that why in years to come there will be no need for central business districts?

Ms Staib : I am sorry?

CHAIR: It is nothing to do with air flying. With modern technology, why do you need to go to the CBD to do business?

Ms Staib : I—

CHAIR: Do not answer. It seems to me that we have some issues at Port Hedland. Were PWC auditing something at Port Hedland?

Ms Staib : Are you referring to PricewaterhouseCoopers?

CHAIR: I am. Mr Rodwell, I think you know all about it.

Mr Rodwell : PricewaterhouseCoopers are at the moment doing a review of all the projects that sit within our capital program to identify whether there are any projects that should be brought to the attention of the Public Works Committee that have not been. You will recall that, when we were at the Public Works Committee, we brought to the attention of the chair, as well as the committee members, a number of projects between $2 million and $15 million that we had not brought to the attention of the committee. We are asking PricewaterhouseCoopers to go back and do a double-check to make sure that we have in fact—

CHAIR: This is a bit sensitive and obviously you have a whistleblower. The allegation is that PwC have been told to go slowly—that Airservices really do not want a superclose inspection of what has been going on at Port Hedland—and they are putting the ball in your court.

Mr Rodwell : I do not know anything of that. There are agreed terms of reference for PwC to conduct their review. As far as I am aware, they are on track to deliver the report.

Ms Staib : Senator, you are not talking about an internal audit matter?

CHAIR: A combination of both.

Ms Staib : Right. We also have PwC as our partner, if you like, to support the internal—

CHAIR: And that does not represent a conflict?

Ms Staib : No, Senator; I do not believe so. After we brought to the attention of the Public Works Committee those projects that we had not referred when we should have, I commissioned a separate audit around compliance with our obligations under Public Works Committee. Whilst I was confident that we had rectified the problem, I wanted assurance from our auditors that that was the case. I wanted to have that extra assurance.

CHAIR: I think it would be fair to say that you might have inherited an S-sandwich. So the summary of what you are saying is that there have been some serious errors, which are being addressed.

Ms Staib : That is correct. There were some omissions, and I brought that to the attention of the Public Works Committee.

CHAIR: Did the people who made the omissions get shown the door or get a slap on the wrist?

Ms Staib : I think when we are talking about this we need to explain that there were changes in staff et cetera, and I believe that is how this happened. What we have done since is modified all our processes and our procedures about how we commence a project so that it very, very clearly has what our obligations are there. We have also modified our board templates. We have templates to put forward propositions to our board, and it clearly indicates now if it needs to get approval from the Public Works Committee.

CHAIR: So the people who now work under you, which I think at an earlier briefing I told to grow up, are no longer white-anting the place?

Ms Staib : Senator, we work together as a team. I think it is fair to say that we will have robust discussion, and I think that is appropriate because at the end of the day—

CHAIR: Yes, bloody oath. That is why we are here.

Ms Staib : Absolutely.

CHAIR: So the prospect of anyone getting their credit card and going down to spend 30 grand at the Ottoman or somewhere is no longer possible?

Ms Staib : No.

CHAIR: Why didn't someone get a bullet in the back of the head over that?

Ms Staib : I have to say that was before my time. What we have done, as you know, is improved all the processes. We have got much stricter controls in place. We have processes in place to make sure that we prevent such a thing happening, but we also have very strong processes in place to detect something like that.

CHAIR: Without knowing the people responsible for that—and there is a line of responsibility—some of them are still in the system. I hope they have learnt from that experience. They are lucky they did not end up being thrown off the cliff, as it were.

Senator GALLACHER: Just on that point, I have received some answers to questions on notice that you have got your credit management instruction. Does anybody get a credit card debt recovered through the payroll before they get paid off? It does say that someone there has to sign off on annual leave entitlements. Has anybody ever had their debt recovered that way?

Ms Staib : I believe there have been some that have been. I will just check with Mr Clark if he has the details.

Senator GALLACHER: I just want to make sure it is being adhered to.

Ms Staib : Yes.

Mr Clark : The short answer to the question is yes. I am just trying to find the detail. Over the 2013-14 financial year, there was $11,000 repaid.

Senator GALLACHER: So this protocol is working?

Mr Clark : Yes.

Senator GALLACHER: I know that other senators have some questions, but I want to briefly touch on a really horrific coronial inquiry report. Mr Mrdak, I note in the government's statement that it says: 'Airservices is accountable to the Australian parliament through the Minister for Infrastructure and Regional Development.' Where do you sit in all that? Do you have any authority over this organisation or not?

Mr Mrdak : No. My department provides advice to the minister in relation To Airservices governance matters, but the board has a direct line of accountability to the minister.

Senator GALLACHER: So you may as well not be here for these purposes.

Mr Mrdak : There are questions about what I do, most days!

CHAIR: Don't worry; it is the same with me!

Mr Mrdak : We provide government advice. We also ensure coordination across the portfolio in relation to aviation policy and regulatory matters. That is the role the department plays.

Senator GALLACHER: There are some findings in the coronial inquiry which are quite damning of Airservices Australia's lack of adherence to proper training and proper procedures, down to the fact that an oversized vehicle, not registered for Northern Territory roads, travelled through an intersection at significantly higher speed than would be expected. Three people are dead. There is a news article saying that Comcare is going to sue Airservices Australia. You have no role in any of that?

Mr Mrdak : We do have a role in providing advice to the minister in relation to these matters. Primarily, the responsibility rests with Airservices. Obviously our role is to ensure that proper governance takes place in relation to the organisation.

Senator GALLACHER: Clearly there has been a failure of governance, as per the coronial findings, and an indication that another Commonwealth entity is going to sue Airservices Australia.

Mr Mrdak : I am not aware of that comment from Comcare but I will take it on notice and check that out.

Senator GALLACHER: As recently as in the last fortnight we were advised that Airservices would continue to offer their vehicles off airport. Given these coronial findings, what action, Ms Staib, are you taking to make sure that all of the areas raised in here are addressed?

Ms Staib : I will start and then I will ask my executive general manager in charge of the fire service to go through the detail. We are addressing all the recommendations by the coroner in the Northern Territory. For example, you mentioned the driver training piece. We have commenced a program, some 18 months ago, at Mount Cotton—I believe that is where the establishment is—to conduct that sort of training for our firefighters on those heavy vehicles. We have commenced a program where we improve the lighting and the signage on the vehicles so that it is very obvious for people in the public that they are fire rescue vehicles. We did have that signage on the vehicles, and the lights, but they need to be bigger so that they are more easily recognised as emergency vehicles. Ms Bennetts, did you want to add anything more?

Ms Bennetts : Probably the only piece that you did not touch on is in relation to the community awareness program that we established immediately following the findings in relation to the coroner's comments about the fact that our vehicles are not necessarily easily recognisable on public roads as emergency services vehicles.

Senator GALLACHER: They are not red. People expect a fire-engine to be red.

Ms Staib : We have studied this and, based on American studies, lime green is the better colour to use—particularly when you are going through night and day. If you look around the ACT you will see that their fire vehicles are the same, colour.

Senator GALLACHER: Well, people expect a fire-engine to be red. That is a motorist's view but you may have a better experience than that. The colour of the vehicle gets a comment in the coronial inquiries as well. I do not want to labour the point but do you have public liability insurance that will cover you in these circumstances? If there is a finding against you, how do you pay for it? Do you put the charges up?

Ms Staib : No, we do have insurance. I just confirm that Comcare are going to bring that matter to court.

Mr Clark : We do have the insurances. In fact, we have quite a comprehensive insurance program.

Senator GALLACHER: So each member of the board will have directors' liability?

Mr Clark : Yes, we have got in place directors' and officers' cover, including cover for employees. We ensure all our buildings. All our operations, both land side and in terms of air space control, are insured. In terms of your specific question around the fine, some of that will not be covered by insurance per se. So we will have to pay for that ourselves.

Senator STERLE: Ms Staib, I am no expert on colours of fire engines—and, if you could provide that information to the committee, it would be very helpful—

Ms Staib : Yes.

Senator STERLE: but what are the colour of the fire engines in Darwin, not yours but the Northern Territory fire brigade or whatever they are called?

Ms Bennetts : They are red.

CHAIR: So there is no differentiation? They are all just plain red?

Senator STERLE: So Territorians expect red fire engines coming through.

Ms Bennetts : And the direct comment made by the coroner was—

CHAIR: And, when they are in operation, there are flashing lights?

Ms Bennetts : Yes.

CHAIR: I think you would pick that before you picked the red vehicle.

Senator WONG: I want to return to the Adelaide TCU and look at a bit of history first. I have gone back to 2001, when, it seems clear, the possibility of closing the Adelaide TCU was explored by your organisation. Is that correct?

Ms Staib : That is correct.

Senator WONG: Ultimately, the then minister, Mr Truss or Mr Vaile, said no—is that right?

Ms Staib : I am sorry, I do not know who it was, but—

Mr Mrdak : Sorry, what time period was that?

Senator WONG: It was 2001.

Mr Mrdak : The minister would have been the Hon. John Anderson.

Senator WONG: Yes, but I do not know how long it was before it was knocked off. Does anybody know? This closure was previously attempted some 14 years ago and the then minister at some point said no. Is that right?

Ms Staib : That is my understanding, yes.

Senator WONG: You were not around?

Ms Staib : No.

CHAIR: You were in kindergarten.

Ms Staib : No, Senator.

Senator WONG: When did you start with your organisation?

Ms Staib : In October 2012.

Senator WONG: But you must have been aware of this having previously been—

Ms Staib : Yes.

Senator WONG: In the period 2007 to 2013, was there any work done again exploring the closure of the TCU in Adelaide?

Ms Staib : There was some research done in preparation for the OneSKY program, which we talked about before, and how the organisation would deliver air traffic control services into the future. Was in 2008?

Mr Rodwell : In 2011 there was some—

Ms Staib : In 2011 there was a report done by Deloittes to look at that.

Senator WONG: But no decision was made to close the TCU?

Ms Staib : In 2011?

Senator WONG: Correct.

Ms Staib : No.

Senator WONG: Are you aware what led to the minister and the board—the board ultimately—determining not to proceed with the closure when it was previously attempted?

Ms Staib : I would have to go back and look at the records for that.

Senator WONG: I suggest to you there was quite a campaign run by particular MPs, Mr Georganas and others, about this issue. Do you have any knowledge of that?

Ms Staib : I believe there was activity from politicians and I do believe at the time there was some objection by Civil Air.

Senator WONG: But it is different now, is it?

Ms Staib : Civil Air have stated that they do not believe it is an issue around safety.

Senator WONG: We will come back to that. So you did some work in 2011. What happened after that? Was it PricewaterhouseCoopers, did you say?

Ms Staib : No, I said Deloittes.

Senator WONG: Sorry, Deloittes. So Deloittes undertook a feasibility study—how did you describe it?

Ms Staib : It was looking at the delivery of our future air traffic control services and how that would be done in terms of the centres and the terminal control units.

Senator WONG: At which point did the closure of the Adelaide Terminal Control Unit arise as a live option?

Ms Staib : At that time.

Senator WONG: At which time?

Ms Staib : When that study was undertaken in 2011.

Senator WONG: What occurred subsequently?

Ms Staib : From what I know—because, as I said, before 2012 I was not there—the information was presented, as I understand it, to the board and it was considered that we would continue to deliver air traffic control services from Brisbane and Melbourne and also Perth and we would continue to look at how we would deliver the approach services that are currently delivered at Adelaide, Cairns and Sydney and move those to Melbourne and Brisbane.

Senator WONG: Are you telling us that this decision was made some four years ago?

Mr Rodwell : Perhaps I can jump in there. In 2011 the board was actually looking at what facilities we would envisage in the future for the introduction of the new air traffic control system in order to be able to prepare the information to go out to market as part of the RFT processes.

Senator WONG: RFT for what?

Mr Rodwell : For the introduction of the new air traffic control system.

Senator WONG: Okay.

Mr Rodwell : With that, the configuration of the facilities of how that might look in the year of 2018 was part of the discussion. That is the Deloitte work that helped to inform that discussion. The board took a decision in 2011, as Ms Staib said, to envisage a future configuration of our facilities of the Melbourne and the Brisbane air traffic control centres and the Perth terminal control unit. Then there would be further work undertaken over a number of years to have a look at the future of the terminal control units in the other locations.

Senator WONG: Would it be your evidence that, at that point, no decision was made?

Mr Rodwell : No decision had been made at that point in time.

Senator WONG: When do you say the decision to close the Adelaide TCU was made?

Mr Rodwell : Only very recently.

Senator WONG: Can I have a date? It is a pretty big decision.

Ms Staib : It was at the December board meeting. I will get the exact date for you.

Senator WONG: Do you have minutes of that board meeting here?

Ms Staib : No.

Senator WONG: Well, I am requesting the minutes in relation to that decision.

Ms Staib : Yes, Senator.

CHAIR: Could you take that question on notice?

Senator WONG: Thank you. Subsequent to that decision, did you inform the employees?

Ms Staib : Yes, that is right.

Senator WONG: And you advised them by email, or CEO—sorry, what was your position again?

Ms Staib : I am the chief executive officer.

Senator WONG: Yes. Did you do a CEO note or something like that?

Ms Staib : There was extensive consultation—

Senator WONG: No, I have not asked that question. I will ask that question, but I am actually asking how you informed them of your decision.

Ms Staib : Of the board's decision?

Senator WONG: Correct.

Ms Staib : I would have to check that.

Senator WONG: Did you or did you not post a CEO message in which employees were informed, on 12 December?

Mr Hood : Each of the employees were advised by their line managers, both in Cairns and in Adelaide.

Senator WONG: When?

Mr Hood : I believe it was one or two days after the board meeting. I will confirm that on notice.

Senator WONG: Do we have the date of the board meeting? You cannot possibly believe that you were not going to be asked questions about this, given the level of controversy in Adelaide and the media attention. You have come along without knowing the dates of these issues? You cannot tell me when the meeting occurred, when the decision was made? Can you at least confirm to me that you posted a CEO message to staff on 12 December in which you advised them, Ms Staib?

Ms Staib : Sorry—can you say that again?

Senator WONG: Did you or did you not post a CEO message on 12 December in which you advised employees that a decision had been made to close the Adelaide TCU?

Ms Staib : I would have to go back and check the date, but I know we did release information after the board had considered the matter.

Senator WONG: I would like a copy of whatever correspondence you as CEO or another person in line management provided to employees to advise them of the decision. I want all communications with employees about this. Can you do that?

Ms Staib : Yes.

Senator WONG: Thank you. At the point when the board made the decision, had you already consulted with the minister's office?

Ms Staib : Yes. Sorry: we consulted with the minister's office about the consideration, but it was up to the board to make the decision.

Senator WONG: But at the time the board made the decision, what contact in relation to the proposed closure of the Adelaide TCU had been made?

Ms Staib : With the minister's office?

Senator WONG: Yes, or the minister.

Ms Staib : We had briefed the minister's office—I would have to check the dates for you—along with a number of other members of parliament and senators. I would have to get those dates for you.

Senator WONG: So, before the board meeting in which the decision was made to proceed with the closure, is it your evidence that you had briefed the minister, his office and some MPs and senators?

Ms Staib : Yes.

Senator WONG: Who in the minister's office did you brief—the minister himself or another person?

Ms Staib : The minister.

Senator WONG: About when was that?

Ms Staib : It was leading up to the—

Senator WONG: December board meeting?

Ms Staib : Yes.

Senator WONG: Did the minister express any concern?

Ms Staib : Yes, he did.

Senator WONG: Did he ask you not to proceed with it?

Ms Staib : No, he did not.

Senator WONG: Was it at the minister or his office's request that you briefed other MPs and senators?

Ms Staib : No. That was our undertaking.

Senator WONG: Who did you brief?

Ms Staib : I would have to get you the list. I can do that.

Senator WONG: Who came up with a list?

Ms Staib : Myself and the executive general manager, corporate affairs.

Senator WONG: Do you want to get the manager, corporate affairs here, because this list is very interesting, because there are four South Australian senators here—well, three here—who I know did not get briefed. I do not know if Senator Edwards got briefed. So can you tell me who you did brief and how you chose them?

Ms Staib : We briefed the local member in Adelaide.

Senator WONG: Mr Williams?

Senator EDWARDS: The member for Hindmarsh.

Ms Staib : Yes. We offered a briefing to the members of this committee—or some members, correction.

Senator WONG: Which members?

Ms Staib : I would have to get that—

Senator WONG: Please tell me you did not just offer it to government members. Are you going to answer that question?

Ms Staib : It was not just government people. For example, we did brief Mr Albanese.

Senator STERLE: Sorry, Senator Wong, but this is very important. Ms Staib, you said you briefed members of this committee. Which members?

Ms Staib : Senator Heffernan, Williams—

Senator WONG: He is not a member of this committee.

Senator STERLE: So New South Wales. Keep going.

Senator WONG: Oh, Senator Williams?

Ms Staib : Yes.

Senator WONG: Oh, sorry.

Senator STERLE: So two New South Welshmen. Who else?

Ms Staib : Mr Entsch.

Senator STERLE: Queensland. Keep going. He is not on our committee.

Ms Staib : Senator Fawcett.

Senator STERLE: Okay. South Australia. Tick. You have got one out of four. Who else on the committee?

Ms Staib : From my recollection—

Senator STERLE: So it was not members of the committee. They were certain political people and some happened to be on and off this committee.

Ms Staib : We offered a briefing to—

Senator STERLE: The secretary is sitting right here. Secretary, did you? No, he did not.

Senator WONG: He cannot—

Senator STERLE: Ah, it is all the smoke. We all know there was no briefing of this committee.

Senator WONG: Sorry, Ms Staib; you wanted to finish the list.

Ms Staib : We offered a briefing to Senator Xenophon.

Senator XENOPHON: When was that? What date was that?

Ms Staib : It was a period when you were away, Senator.

Senator XENOPHON: I will find out.

Senator WONG: When did the briefing of Mr Williams occur—not Senator Williams but the member for Hindmarsh? When did that occur, approximately?

Ms Staib : It was leading up to the board meeting.

Senator WONG: So it was prior to the meeting. Did he ask you not to proceed?

Ms Staib : No, he did not.

Senator WONG: He did not tell you not to proceed?

Ms Staib : No.

Senator WONG: So the local member did not stand up for jobs in the electorate?

Senator EDWARDS: Let's get to the issue.

Senator WONG: Okay. You might not think that is an issue, Senator Edwards, but I think—anyway, I will move on.

CHAIR: I apologise for being out of the room on another matter. I understand the question was: was I briefed? I was. I think, as the standard members of this committee know, and the Public Service knows, if I have got a bellyache, you will get it. So the place to cop it is here. I thought it was a bit odd, which is why I asked the questions earlier tonight on Adelaide and Melbourne. You have explained. I would like to think, if I were landing a plane, which I no longer do, in Adelaide or anywhere else—except there are some places where you work it out for yourself, I have to say, including the paddock—that the guy in the control tower is in the control tower and not 500 miles away, which you have confirmed he will be in Adelaide. I did think to myself that the appropriate place to have this discussion is in the public forum. There is nothing wrong with a robust contest of ideas; that is what we are here for, to hear both sides of the argument.

Senator STERLE: Can I just clarify something? With great respect to you, being out, when Senator Wong was asking about briefings about the Adelaide control tower Ms Staib did say she briefed this committee. That is what started the conversation. She has since cleared up to certain members of parliament, two of whom are on this committee. Just so you know.

Senator WONG: Could I, on notice, get a full list of the parliamentarians briefed on this issue, by date, please. I have two issues I want to explore. The first is the safety case. I am new to this committee, so I do not understand all of the technical issues—

CHAIR: There is not much technical; it is cultural.

Senator WONG: Cultural—those too. If a decision is to be made, how do you go about ensuring that that decision is safe? Is there a full safety case undertaken, which I understand would have to be conducted by CASA? Explain to me what the process has been or should be.

Mr Hood : Within the context of our safety management system, whenever we make or propose a major change there are several steps in the process. The initial one is to do a safety case determination and look at the size of the change. If its size is considerable then we are required to prepare a full case. We prepare the safety case and then we submit it to the Civil Aviation Safety Authority.

Senator WONG: It is a little bit like the EIS process in the environmental context.

Mr Hood : That is correct.

Senator WONG: Did you prepare a safety case and submit it to CASA?

Mr Hood : We have done an initial risk assessment and safety case determination that says in the context of preparing for the change we are required to prepare a full safety case, and that has to be submitted to the Civil Aviation Safety Authority.

Senator WONG: When will that happen?

Mr Hood : Preparation of the safety case has commenced.

Senator WONG: How can you as a board make a decision to proceed with closure before a safety case has been undertaken?

Mr Hood : The initial risk assessment was based on the fact that we already conduct terminal area control unit services—

Senator WONG: That is your assertion, and there are a range of other assertions that have been put to me about why what you are saying is incorrect. I do not want to have an argument about that tonight, but just as a matter of logic I do not understand how you can make a decision to change arrangements and assert that they are safe before any safety case has been undertaken. Can you explain that to me?

Mr Hood : As I referred to, the precedent in terms of the way in which we already provide terminal area control services for Canberra from Melbourne, and have done for 20 years—

Senator WONG: That is not a logical argument. That is a proposition that, presumably, if you are correct, the safety case will tick off on. That is your view, whereas your organisation has made this decision without the regulator considering the safety case. How is that possible?

Mr Hood : The organisation's view, particularly at the board level, is that they are satisfied that the initial risk work was adequate to proceed to the full safety case.

Senator WONG: But the decision has already been made.

Senator GALLACHER: Can I just clarify here that the board has made the decision, irrespective of the safety case or will they take into account—

Ms Staib : It is subject to the safety case. We must still submit the full safety case to CASA. If CASA find that they do not believe that we should be doing this it cannot proceed.

Senator WONG: If I had known that I would have asked questions of CASA about how other people get to make submissions. Can you confirm that you did not consult the state government at any point prior to making this decision.

Ms Staib : That is true. That was an omission.

Senator WONG: That was an omission.

Ms Staib : Yes.

Senator WONG: So you talk to a couple of MPs but you do not tell the state government that you are going to close the TCU?

Ms Staib : That is correct. We have subsequently offered briefings to the state government.

Senator WONG: That is useful.

CHAIR: Could I just assist the committee? You can put those questions to CASA on notice—

Senator WONG: Yes, I will. I will, thank you, I appreciate that. Finally, I want to understand the terms of what assurances you are giving employees. What are the terms of these pending redundancies, which are subject to a safety case as yet unfinished? Can you tell me what assurances you have given to employees, what are the terms and conditions of this closure?

Ms Staib : Yes. I will just get the executive general manager, ATC to just go through that.

Mr Hood : Thank you for the question. The staff affected in Adelaide and Cairns have been offered the opportunity to remain in those locations and have been redeployed to the air traffic control towers themselves in those locations. They have been offered the opportunity to consolidate with Adelaide to the Melbourne facility or with Cairns to the Brisbane facility, or, in fact, they have been offered the opportunity to nominate deployment to any of our other 28 facilities across Australia. Or, in fact, if they decide that they would rather not do so then the redundancy provisions of the enterprise agreement would be applicable to them.

Senator WONG: Can I be clear, you get a job if you move, but if you do not want to move, what is the position? You can apply for a job with the tower?

Mr Hood : We will appoint you to the tower, even if we have to keep a couple of excess staff in the interim until retirements.

Senator WONG: And that is a guarantee at the same rate?

Mr Hood : That is a guarantee that they would be able to remain in situ in Adelaide with a job at Airservices.

Senator WONG: At the same rate of pay?

Mr Hood : I cannot recall the details of that, but I am happy to take that on notice.

Senator WONG: Can you also—

Mr Hood : In all course events, we would maintain salary for those people.

Senator WONG: Can you, on notice, provide the details of what you say are the terms and conditions?

Mr Hood : Certainly.

Senator WONG: And if the safety case is not up to scratch, do you not proceed with it?

Ms Staib : If CASA does not accept the safety case, that is correct.

Senator WONG: Well, as a South Australian senator, I am asking you not to proceed with it. So you should be clear, on the record, it is my view and I suspect it is the view of many of my colleagues. We do not want this decision made. We do not want these jobs shifted. We certainly do not what we regard, from what we have been told and what I see the state government saying, something that compromises these arrangements at Adelaide airport.

Senator EDWARDS: Just following on that line of question, is it true that the genesis for this policy actually exists in a previous government? No, the genesis for this is laid dormant but was a policy of a previous government.

Mr Hood : Senator, if I can take that—

Senator EDWARDS: Sorry?

Senator WONG: It is happening under you.

Mr Hood : The two-centre policy was a strategy of the board that originated back in the 1990s, when all of the airspace management for Australia would be done from the Brisbane and Melbourne centre. We would still have control towers, but the airspace would be done from the Brisbane and Melbourne centres. Since the early 1990s, we have consolidated airspace continuously into the Brisbane and Melbourne centres. It is not just the last government; it goes back to the early nineties.

Senator EDWARDS: But that is done on the basis of what—technology or resources? What is the catalyst for this consolidation? I bought a television which was this big and that wide and that fat 10 years ago, and it cost me $5,000. I can buy one twice as big now, that wide and that long for a tenth of the money. What is driving this consolidation?

Ms Staib : At the moment, for example, our flight information region, which is about 11 per cent of the earth's airspace, we divide into two because of the limitations of our hardware and software. But you are right, over the several decades technology has improved. You might like to talk about the improvements in surveillance over the years.

CHAIR: Could we talk about the improvements in technology? When it was £4.10 an hour for me to learn to fly, we used to have an aluminium calculator to work out the wind so that we ended up in Hay and not Ivanhoe. Things have changed since then. Because Senator Wong is a prominent visitor in our company here tonight, I would like to point out to her that the airspace that involves the Norfolk Island incident was controlled by New Zealand. That is technology.

Senator GALLACHER: Could I just follow up on the last point. It has been put to me by someone who has a detailed knowledge of the people who actually pay Airservices—in terms of charges for providing these air traffic controller services—that, if your business case is true and you can do things remotely, transferring from Cairns to Brisbane and from Adelaide to Melbourne is going to be more expensive in the long haul for those people and that they would be better serviced by decentralised employment. It is cheaper to live in Adelaide and it is cheaper to employ in Adelaide than it is in Melbourne. I think that is probably going to be self-evident. The same goes for Cairns. And their view is—

Senator EDWARDS: Are there any job losses?

Senator GALLACHER: Hang on a second. I want an answer to my question.

Senator EDWARDS: No, that is your contention.

Senator GALLACHER: No, my question is very clear. It has been put to me by people who pay your charges that consolidating into Brisbane and Melbourne will inevitably have them pay more in charges, whereas, if it continued to be decentralised, charges would not rise as much.

Senator STERLE: You got that one wrong, Sean!

Mr Mrdak : If you look at the remuneration, my understanding is—

Senator GALLACHER: I did not think you had anything to do with this crew.

Senator Sterle interjecting

Mr Mrdak : I was just going to add that my understanding of the enterprise agreement is that the salary levels for air traffic controllers are uniform across the country.

Ms Staib : Senators, as I understand it, you are asking about charges—

Senator GALLACHER: I am talking about user charges, landed tonnes.

Ms Staib : from industry. There is a suggestion from industry that the fees will be increased. I will get Mr Clark to address that.

Mr Clark : Our user charges basically apply to three service lines. We generate an en-route service on which we bill for distance flying between city pairs, based on 100-kilometre units. We also levy—

CHAIR: Maybe you just need to turn your microphone around a little.

Mr Clark : You cannot hear me?

Senator XENOPHON: No, don't touch the mike. Move closer to it.

Mr Clark : Don't touch it?

CHAIR: That was better.

Senator Cash: You have to lean forward.

Mr Clark : Right. I will lean forward. We also levy a terminal navigation services charge that relates to the tower and approach services in and around aerodromes up to about 35 to 40 miles from the aerodrome, and of course there is an aviation rescue and firefighting charge. The en-route charge itself is a network based charge, in essence, for the assets and the services used to provide that service—and 'network' in the sense that it applies right across Australia. So it is the one rate per tonne regardless of where you land, ultimately, at the end of the day, but it is based on distance. In this particular case, if you were flying from Abu Dhabi to Melbourne as opposed to from Singapore to Melbourne, you would pay more for the former than for the latter, as an example. It is purely based on distance.

The terminal navigation charge relates to the costs at the location and the asset base that is associated with that location, although there are elements of cross-subsidy that exist between, say, Sydney, Bankstown and other locations. Similarly, with aviation rescue and firefighting, there is a cross-subsidy that exists between larger aircraft and smaller aircraft, but there are components of both networked and location-specific pricing.

In that sense, without going into too much more detail about the construct, even though we might shift costs from one location to another, at its highest order level there would not be an increase in charge. If you look at the TCU, the savings that can actually be made in efficiency from an economy-of-scale perspective—particularly if we look at maintaining TCU's locations in Adelaide and Cairns—are not insignificant. So, as we roll out new systems and systems adaptation—we were talking about OneSKY previously—we would have to put that technology into those locations. We have to maintain what is otherwise a reasonably large facility and amenity. From a pure cost, business case perspective, it will not increase the charges. Over the medium to longer term, it will actually have a positive impact on reducing them.

Senator GALLACHER: Thank you.

CHAIR: I do not want you to have a heart attack, Senator Xenophon, so I think we better let you have a go.

Senator XENOPHON: I have already had open heart surgery. Do you want to see the scar?

CHAIR: Too much detail.

Senator EDWARDS: It proved you had one, anyhow.

Senator XENOPHON: Yes, thank you. Nothing like a vet giving you medical advice! I do not want any ketamine. I just want to go further to those questions raised by Senator Wong, Ms Staib. Has a safety case been prepared to CASA?

Ms Staib : It is currently being prepared.

Senator XENOPHON: Can you provide us with a copy of that case?

Ms Staib : When it is completed.

Senator XENOPHON: Is the decision revocable or subject to the safety case?

Ms Staib : No, it is subject to the safety case—absolutely.

Senator XENOPHON: You may remember that during this committee's inquiry on 28 November last year, there were issues in respect of LAHSO where there was a breach of CASA regulations in respect of LAHSO, but Airservices Australia still went ahead with that. Was that something that was inadvertent?

Ms Staib : Yes.

Senator XENOPHON: That was inadvertent? What is the process? You go to CASA; will there be an opportunity for others than Airservices Australia to make submissions in respect to that case? Or is it just a closed shop between CASA and Airservices Australia?

Ms Staib : It is my understanding that it is normal practice that Airservices submits the safety case. In regard to how CASA reviews that, do you, Mr Hood—

Mr Hood : No, I do not.

Senator XENOPHON: We may need to call back CASA or have a separate hearing in relation to that, Chair. It is a very important issue. Okay, so we will check that with CASA. I want to ask whether Airservices has prepared—

CHAIR: Just to assist you, Senator Xenophon, it was suggested to CASA earlier that we may have a private briefing. That may be the opportunity for you to pursue whatever you are after.

Senator XENOPHON: Sure. Has Airservices prepared a business case regarding the move that justifies the proposed savings and the like?

Ms Staib : Yes, that is correct.

Senator XENOPHON: Has this been released publicly?

Ms Staib : No.

Senator XENOPHON: Why not?

Ms Staib : That is not our normal practice to do that, because it was a submission put to the exec and then to the board.

Senator XENOPHON: You are not suggesting it is commercial-in-confidence, are you?

Ms Staib : There are some commercial—but if you wish to see the business case I can furnish that for you.

Senator XENOPHON: I cannot see how it would be commercial-in-confidence when Airservices is a government entity with no competitors.

Ms Staib : As I said, if you wish to see that business case I can furnish that to you.

Senator XENOPHON: To the committee?

Ms Staib : To the committee, certainly.

Senator XENOPHON: There is nothing there that will cause any commercial harm to Airservices given that you are a monopoly provider of these services.

Ms Staib : In that particular case, there is not.

Senator XENOPHON: Okay. So, on notice, could you provide that to the committee as a matter of urgency. The issue of the safety case has been dealt with. One of the areas of concern that has been raised with my office is the need for local knowledge—that is the need for air traffic controllers to be familiar with the local area, the landmarks, the suburbs and so on. This is particularly important when dealing with non-commercial traffic. How will Airservices maintain this local knowledge if the proposed move goes ahead?

Mr Hood : I suppose there are a couple of issues. One of them is that we employ a range of people from overseas at Airservices—from the United States, New Zealand, Denmark. All of those people do not have the specific local knowledge about where they perform the services in the long term, too. So the way in which we address the local knowledge issue is through training.

Senator XENOPHON: But those controllers, whether they are from Denmark or Kazakhstan, are operating out of a tower dealing with local traffic. Correct?

Mr Hood : In some cases, yes—or, in some cases, remotely. We have controllers that control Canberra approach from Melbourne. We have controllers that control Gold Coast approach from Brisbane. So it is not always in the location for which they provide the services.

CHAIR: For the uninitiated, so that people can understand what you have just said, when you say 'control the approach', at what stage of the let-down does the local tower take over?

Mr Hood : For example, if you get your flight tomorrow from Canberra to Melbourne, when you get in your aircraft and you pushback and taxi you are in the jurisdiction of the control tower itself. Everybody knows the control tower; it sits up there and stands out on the tarmac of the aerodrome. Once your wheels are off the deck out of Canberra heading for Melbourne, the frequency will change and you are being controlled by a unit called Canberra Approach, but in actual fact it is in the Melbourne air traffic control centre. The way that we ensure the controllers have adequate local knowledge is that we train for that. There are overhead maps for it, there are maps on the screen for that, and there are obviously rating papers and tests to ensure that controllers are tested for the local knowledge.

Senator GALLACHER: I accept that Airservices Australia does a fantastic job, but we are dealing with an organisation that has had a couple of failures in governance. One of those failures is actually a coronial inquiry, where you did not follow any procedures and you may be sued by another government department. You are expecting us to take this process you are going through now as a given, without any proper substantiation of the safety of the travelling public. I have to look back and say that, if I can read about a coronial inquiry where you did not do the right thing, I have serious misgivings, and I join Senator Wong, and other senators and members of parliament I am sure, to say that this should not go ahead. The track record of this organisation is not giving me any confidence at the due diligence level and the governance level—but not at the ground level, where the work is done.

Senator XENOPHON: I have a number of questions on a number of critical safety issues. How will the knowledge be passed on if ATCs do not continue to come in from Adelaide? Are you saying that it is training, even though they will not have that local knowledge? How much money are we saving with this proposed move?

Ms Staib : This was not about saving money. This was about improving our delivery of our services. There will be avoidance—

Senator XENOPHON: Will you end up saving money, was well?

Ms Staib : We will avoid further expenditure. I am not trying to be cute. I am not slashing the budget but I am trying to avoid—

Senator XENOPHON: So you will be saving money?

Ms Staib : That is one way of looking at it.

Senator XENOPHON: Okay!

Senator Cash: To be fair, that is not the reason for what is being undertaken by the board. Clearly, that is her evidence. There are other reasons that the board has made the decision. That is the evidence that I have taken, and it did not have anything to do with cost savings.

Ms Staib : That is correct.

Senator XENOPHON: Does that mean the new system is going to be more expensive?

Senator Cash: No.

Ms Staib : No.

Senator XENOPHON: But it will happen to be cheaper?

Ms Staib : It goes to the issue of us preparing for the future and the increase in growth of traffic. We are trying to deliver our services in a more efficient way so that we can deliver value for money in a very safe way.

Senator XENOPHON: If you do not do this subject to the safety case, it will end up costing you more money. Is that a fair summary?

Ms Staib : Yes. We are moving into the future and preparing for the new system.

Senator XENOPHON: My understanding was that one of the aims of the proposed move was a greater centralisation of services. Is that part of it?

Ms Staib : Yes, increased consolidation of services.

Senator XENOPHON: That is something that Senator Cash, as a Western Australian, should always be wary of! I want to go to a couple of specific issues that have been put to me by pilots and by information from air traffic controllers. I refer to an incident that occurred on Friday, 13 February this year—a rather ominous date. In the evening in Melbourne, with at least nine aircraft taxiing and trying to depart the airport, runway 16 was in use. I am informed that around 10 pm, with some aircraft trying to leave before curfew restrictions in Sydney forced diversions, the INTAS ground radar, a vital component, failed. Are you aware of that?

Mr Hood : I am.

Senator XENOPHON: This I understand that all information relayed to aircraft in their position on the taxiways was lost. Is that right?

Mr Hood : If you can finish the line of questioning I might be able to provide you with a comprehensive answer.

Senator XENOPHON: I am told that the ground controller, although very calm, advised that they had lost all information pertaining to aircraft movements. I want to find out whether that is true. Someone on the ground frequency asked, 'Was it INTAS again?' I presume that may have been one of the pilots speaking to the controller. The answer, I am informed, was 'Yes.' Can you confirm this, because I am getting a number of complains about INTAS. If this was a foggy night in Melbourne it potentially could have been quite a serious incident.

Mr Hood : If I can outline the circumstances. Firstly, I have not got the detail with me. I did not expect that to come as a question. But I am aware of the incident and I am happy to talk to it. Firstly, my understanding of the night in question is that there was thunderstorm activity and a number of aircraft taxiing in from the runway after landing were unable to reach their gate because, obviously, what happens in thunderstorms now is that ground handlers vacate the tarmac and you are left with several aircraft in stand-off bays that are unable to get in there. Sometimes you can be sitting on the aeroplane for more than an hour. I will confirm all of this on notice, because I do not have the details with me.

The variable system parameter for INTAS for the strips disappearing after landing is an hour, because you never actually could be expected to taxi in an hour after you landed on the runway. So it is my understanding that once these aircraft that were taxiing in towards the bay could not get there—some of them for over an hour—and the strips completed what is called a finishing event and disappeared from the surface movement controllers display. That was reported. Once again, I dearly love my workforce. I sometimes wish they would take issues with me instead of with others—

Senator XENOPHON: What do you mean by that?

Mr Hood : We have a number of—

Senator XENOPHON: Are you saying I should not be asking this?

Mr Hood : I am delighted to answer any questions—

Senator XENOPHON: You just implied that you wish it was raised with you first. Is that what you are saying?

Senator BACK: With respect, Senator Xenophon, you are drawing a long bow. The gentleman simply answered your question.

Senator XENOPHON: No.

CHAIR: Order!

Senator XENOPHON: Mr Hood, a number of pilots were inconvenienced that night. Has it occurred to you that it may not be your workforce and it may be some pilots who have spoken to me?

Mr Hood : My controllers did report it to me, because we did submit the ESIR event. So they did report it to me. In fact we have taken immediate action. Looking at the parameter of what happens, if it happens again, if there is another thunderstorm in Melbourne and they are taxiing in, and it is for longer than one hour, will the strip disappear? So we have taken action immediately, following the receipt of that event, to change—

Senator XENOPHON: I have a text message from somebody who was there that night saying, 'Crap, the storm had passed.' Could you just check that for me?

Mr Hood : Certainly.

Senator XENOPHON: I am just quoting the text message.

Mr Hood : I did not bring the details with me and I am happy to confirm it on notice. But we have taken action to change the system parameter for strips finishing to a five-hour period instead of a one-hour period.

Senator XENOPHON: You do not see this as a further indication of teething problem—real problems—with INTAS?

Mr Hood : I have talked to controllers in Melbourne, Adelaide, Broome and Rockhampton. If I could put on the record my thanks to the controllers at Rockhampton, who did an outstanding job this week during tropical cyclone Marcia. I have talked to controllers in all four of those locations—the system is good. Is the system perfect? The answer is no. Can the system be better? The answer is yes.

CHAIR: If I could interrupt, Mr Rodwell, you just gave a bit of a kick with your elbow. Did you want to say something?

Mr Rodwell : I was just going to point out to Mr Hood that the controllers can continue to see the aircraft from the tower. This is a system setting that is put in place in the INTAS system so that when the aircraft has landed and completed its movement and is proceeding onto the bay, and the controllers no longer need that information, there is an hour set aside there for that normally to occur. The situation that occurred here was that because the aircraft were sitting waiting to get onto the bays, the parameter that had been set to an hour was triggered and a number of the aircraft strip displays were removed. We are addressing that by adjusting that out to five hours so that if we ever do get another situation where we have aircraft sitting on the ground waiting for a long period of time to go onto their bays that information is still available to the controllers.

CHAIR: And this is triggered by the safety of the ground crew on the ground, which I can relate to, having had someone in my family who was recently leaning on a gate when lightning struck the fence a mile away.

Senator XENOPHON: I want to go to a specific incident that occurred on 12 November 2013. There were departures from Melbourne runway 16 and Essendon runway 26. I think Essendon is to the south of Melbourne airport. Is that correct?

Mr Hood : Correct.

Senator XENOPHON: Those two runways intersect south of Melbourne airport when aircraft are taking off.

Mr Hood : That is correct.

Senator XENOPHON: Such a runway setup needs coordination between Melbourne tower and Essendon tower. That is pretty axiomatic.

Mr Hood : That is correct.

Senator XENOPHON: The information I have is that this did not occur—that for a period of time no coordination was in effect. Can I put this to you. In their report dated 12 November 2013, Airservices reported the incident as a breakdown of communication. Is that correct?

Mr Hood : I do not have that with me but my understanding is that that is correct.

Senator XENOPHON: You may want to take some of this on notice because these are actually—

Mr Hood : If I can, that would be great, because that one was a fair while ago.

Senator XENOPHON: To the extent you can answer please do so. This report basically talks about a breakdown in communication, although the answer to question on notice No. 237 makes reference to approximately three hours having elapsed before the error was corrected, and I think we are talking about the same period. That is quite a significant period of time. The ATSB would have reviewed this report and noted the breakdown of communication and filed it, as would have CASA. Is that correct?

Mr Hood : That is correct.

Senator XENOPHON: Some time later a REPCON, which is the confidential reporting system for an issue involving a safety issue, was generated that said a loss of separation and separation assurance occurred. That is much more serious, isn't it? A breakdown in communication and a loss of separation and separation assurance is fundamentally much more serious than a breakdown of communication?

Mr Hood : It can be. We treat each of them as a serious incident. A breakdown in coordination can of course lead to something worse, and a breakdown of separation assurance can lead to something worse.

Senator XENOPHON: This may have to be the subject of a separate hearing, but the information I have received today is that the ATSB went back to Airservices and were again assured that it was a breakdown of communication that occurred. Can you confirm—

Mr Hood : I will take that on notice. It was a fair while ago. I am aware that the coordination between Essendon goes to the terminal area coordinator, which goes to the controller, which goes to the tower. So there are a number of links in that chain.

Senator XENOPHON: Sure, but this was a three-hour period when there was not only a breakdown in communication but there would have been a loss of separation or issues in respect of loss of separation.

Mr Hood : I will certainly look into that. I will take it on notice.

Senator XENOPHON: You could perhaps tell me how many take-offs and landings there were on those two runways at Essendon and Melbourne airports for that three-hour period.

Mr Hood : I will let you know that, too.

Senator XENOPHON: If what I have put to you is correct, as I believe it is, should this have gone straight to the ATSB and CASA as a safety matter, not as a breakdown in communications?

Mr Hood : I suppose a breakdown of communications is also a potential safety matter. And, of course, when that was reported through our ESIRs system that goes automatically to both the regulator and to the ATSB.

Senator XENOPHON: There is one thing that got my back up in answer to questions No. 237—which some people have responded to me on. You cannot always assume it is your employees. There are lots of people who talk to me who are not employees of Airservices.

Mr Hood : I love them dearly.

Senator XENOPHON: And God bless all of the people who keep talking to me. Airservices state that 'the provision of the other information requested is complex and would require a significant diversion of resources'. Do you remember that?

Mr Hood : No, I do not. As I said, I will take that on notice if I may.

Senator XENOPHON: Can I suggest to you that that is actually untrue. The information I have is that getting this information is less than six mouse clicks away. So could you please revisit that issue, because my information is that from multiple sources you could obtain this information very easily and Airservices purported statement that it is too complex and requires too many resources is not accurate at all.

Mr Hood : I will certainly look at that.

Senator XENOPHON: I have more questions but I will stop now to give others a go.

Senator EDWARDS: Ms Staib, what is the first priority for Airservices Australia?

Ms Staib : Senator, it is safety.

Senator EDWARDS: The safety of?

Ms Staib : Air traffic management, and also the provision of our fire-fighting service.

Senator EDWARDS: Do you have a history of operating other terminals in the same way as what you are proposing between Adelaide and Melbourne?

Ms Staib : Sorry, I am trying to understand your question.

Senator EDWARDS: You are looking to locate the services currently being operated in Adelaide from Melbourne. Do you have any other examples of that?

Ms Staib : Yes, we do.

Senator EDWARDS: Can you give me those examples, please?

Ms Staib : We provide the approach services for Canberra in the Melbourne centre, and we provide the approach services for Coolangatta in the Brisbane centre.

Senator GALLACHER: The pull I suppose is: were there controllers in those Coolangatta and Canberra airports before you removed them?

Ms Staib : Before, yes.

Senator EDWARDS: How long has that been in operation?

Ms Staib : Some 20 years.

Senator EDWARDS: So that was 20 years, which was back in, what, the Hawke-Keating days when that change was made, or when that policy was developed?

Ms Staib : Well, it was 20 years ago.

Mr Hood : It is over 20 years.

Senator EDWARDS: The Airservices Australia board has been established for a long time. Has there been any diminished safety in that 20 years by virtue of that policy initiative?

Ms Staib : No, Senator.

Senator EDWARDS: Has there been any issue at all? Have there been budgetary savings? Has there been any compromise to your first order of priority, being safety?

Ms Staib : No, Senator.

Senator EDWARDS: Okay. Then we will go to a local issue,—and the air has been pumped into the tyres of it here, today—will there be any reduction in the number of air traffic controllers, control towers or the level of service provided to the aviation industry as a result of the collocation?

Ms Staib : No, Senator. The number of air traffic control towers remain—

Senator Sterle interjecting

Senator EDWARDS: You can push this out.

Senator STERLE: We are wasting time.

Senator EDWARDS: Senator Wong pedalled this information, and I am looking for clarification. I am interested. I come from Adelaide.

An honourable senator interjecting—

Senator EDWARDS: I did not interrupt you, and I have not interrupted anybody else.

Senator Sterle interjecting

Senator EDWARDS: I am not. I am interested in the facts. Are there going to be any job losses by virtue of this policy change?

Ms Staib : No, Senator.

Senator EDWARDS: Will controllers be offered retraining in accordance with their personal preferences?

Ms Staib : That is correct, Senator.

Senator EDWARDS: Can you tell me: of the two examples that you gave me that Canberra and Gold Coast are operated from Melbourne and Brisbane, how much of Australia's air space is under this type of policy jurisdiction emanating from Melbourne and Brisbane? How much of Australia's air space is controlled?

Mr Hood : Around about six per cent of the world's surface area is controlled from Melbourne. Around about five per cent of the world's surface area is controlled from the Brisbane centre.

Senator EDWARDS: Okay, well give me the Australian air space.

Mr Hood : Eleven per cent, and 60 per cent of your flight from Dubai to Sydney is in our air space.

Senator EDWARDS: From Melbourne or Sydney?

Mr Hood : From Melbourne.

Senator EDWARDS: Sorry, from Melbourne or Brisbane?

Mr Hood : From Melbourne.

Senator EDWARDS: So, how much of Australia's air space does Brisbane and Melbourne control?

Mr Hood : Eleven per cent all up, sorry, of the world's air space.

Senator EDWARDS: No, I am interested in Australia's.

Mr Hood : All except for pockets that belong to the Department of Defence for RAAF—Cairns approach, 30 miles around Cairns; Sydney approach, about 50 miles around Sydney; Adelaide approach, around 30 miles; and in Perth around 30 miles.

Senator EDWARDS: So we are talking, what, one per cent, 10 per cent?

Mr Hood : A very low percentage, Senator.

Senator EDWARDS: Single figures?

Mr Hood : Single figures.

Senator EDWARDS: Single figures. So this is not really something that you have not been involved in before. In actual fact it is not a major shift from what you are currently doing.

Mr Hood : That is correct, Senator.

Senator EDWARDS: And no job losses?

Mr Hood : That is correct, Senator.

Senator EDWARDS: Nobody is going to be put in a headlock and told that they are now cleaning the toilets?

Mr Hood : That is correct, Senator. Well, I am glad that we got that on the record.

CHAIR: Out of curiosity, is the tower vacant in Wagga Wagga?

Mr Hood : Yes, Senator, it is, but we are actually watching Wagga Wagga carefully because that is where Rex has its training college. We work with the regulator to have a look at any rising levels of risk. If we think there are those, then we will do an aeronautical study in conjunction with the regulator to review the level of service provided.

CHAIR: I have to confess, back in 1965, my instructor and I took off on the taxiway past the tower.

Honourable senators interjecting—

Senator RICE: I want to talk about East Melbourne. I understand that the issue of aircraft noise over East Melbourne was raised with you in Senate estimates by my colleague Lee Rhiannon in 2013, and that Adam Bandt MP has made representations to you about this issue since 2013. I am interested to find out what Airservices Australia has done in this time to respond to the concern of East Melbourne residents?

Ms Staib : I will ask my colleague from corporate affairs to join me, just to amplify my answer and just in case you want further detail. My staff have met—I have not met with the member—and we have worked with him and some constituents to certainly explain how we manage noise and what processes are available to people to submit suggestions for improvement. I cannot recall, but it was several months ago when we did respond to that letter.

Ms Barton : I do not have the specifics of how we have addressed that issue, so I would need to take it on notice. Certainly, I can talk more generally about how we address aircraft noise issues. Aircraft noise is a key challenge for Airservices, and is something we take very seriously because of the accountability we have been given as the noise complaints receiver. The strong growth in aircraft movements is obviously resulting in a bigger impact of noise for residents, and we understand that. Unfortunately it is a complex issue because, when you have more aircraft travelling, particularly in built-up urban areas, it is virtually impossible to remove all aircraft noise. Having said that though, we have implemented a number of initiatives in recent years in order to improve the way we are managing noise. Those initiatives include active participation in community forums in around 21 airports around Australia to ensure that we are consulting and receiving feedback from the community; using short-term trials in order to test out flight path changes where we can.

Senator RICE: Have you done those in East Melbourne?

Ms Barton : I do not have specifics of that. As I said, I will need to come back to you with specifics on East Melbourne.

Senator RICE: Perhaps if you have not got specific East Melbourne examples, let us not use up the time of the committee.

Ms Barton : I will take that on notice.

Senator RICE: Does Airservices Australia monitor the number of flights in the East Melbourne area?

Ms Barton : We monitor all flights and we record that information.

Senator RICE: Can you tell us how many flights there and the increase in flights over a period of time, say, over the last 10 years?

Ms Barton : We can absolutely provide that information, so I will take that on notice.

Senator RICE: What noise monitoring has Airservices Australia conducted in East Melbourne?

Ms Barton : Again, I would need to take on notice specifically about what is happening in East Melbourne.

Senator RICE: So you do not know.

Ms Barton : I do not have that information to hand.

Senator RICE: Can Airservices Australia commit to formal noise monitoring for East Melbourne, given it has been a live issue, as you have been aware, for the last two years?

Ms Barton : That is a matter that would be discussed at the community forums, and then decisions are made based on where we have an issue.

Senator RICE: Is there a regular community forum in East Melbourne for the East Melbourne residents?

Ms Barton : It would be a community forum that is based around aircraft movements from Tullamarine or Essendon.

Senator RICE: It is mostly helicopter movements largely, as I understand it. So it is not related to Tullamarine or Essendon.

Ms Barton : Yes—

Senator RICE: So you do not know.

Ms Barton : We can deploy mobile noise detection units. As I said, I do not know what has been put in place for East Melbourne.

CHAIR: Can I just get an explanation? Are we talking about having aircraft noise near an airport?

Ms Barton : Yes, we are.

CHAIR: Holy hell!

Senator RICE: Basically it is helicopter noise.

CHAIR: But they are landing, are they?

Senator RICE: Residents have been keeping records of the level of noise and the frequency of flights. What the residents want is an end to leisure helicopter flights over the area and limits on the period of time aircraft can hover in the area. They want flights over the MCG, of which there are a lot, to fly over the south side rather than over the north side. These are quite reasonable minor changes.

CHAIR: But we are not over in the Middle East, where the aircraft noise is a bit more serious.

Senator RICE: They want aircraft to fly over highways and waterways instead of over residential areas and given you have got the Yarra there that is a possibility. They stress that they have no concerns about aviation noise from emergency services.

CHAIR: Can you put the rest of your questions on notice? Senator Xenophon has some questions.

Senator RICE: I just have a couple more questions. I may as well finish it rather than put them on notice. Given that you have been talking with residents—and it was raised in estimates in 2013 and it has been raised with Mr Bandt—does Airservices Australia acknowledge that noise has increased?

Ms Barton : We acknowledge that noise issues are increasing right around Australia due to the exponential growth of air traffic movements, yes. It is a complex issue because where you have aircraft movements you cannot remove aircraft noise altogether. As I said, notwithstanding that, we do not back away from trying to address the challenge and trying to improve the situation where we can, which means consulting—

Senator RICE: But you basically do not know. You have not done the monitoring that is required in East Melbourne, as far as you know.

Ms Barton : I have not said that, Senator. What I have said is that I do not have the specifics of what we have done in East Melbourne and I would be really pleased to take that on notice and come back to you with a thorough brief and in fact would be very happy to sit down with you and take you through what we have in relation to that.

Senator RICE: I have another couple of questions. Are aircraft operators bound by any regulations relating to noise and amenity for residents? Is there anything more than voluntary commitments that can be made to limit aircraft noise in East Melbourne?

Mr Mrdak : Yes, there is, Senator. There are requirements in terms of the certification of the aircraft, there are requirements in terms of the height of overflight of residential areas and there is also, as you describe, fly neighbourly and arrangements in terms of environmentally sensitive fly paths to try to minimise overflight. A number of the examples you have cited, though, are very difficult to move. They are effectively part of the urban life of Melbourne.

Senator RICE: But it sounds like there are some measures that actually could be required of operators if Air Services Australian asked.

Mr Mrdak : As Ms Barton has indicated, wherever possible we try to accommodate that, and I think she has indicated to you a willingness to look at that.

CHAIR: Can we also do something about Harley motorbikes? They give me the heebies. They are too bloody noisy.

Senator XENOPHON: Can I follow on with the line of questioning in respect of the incident on 12 November. I have got a copy of this document from your website. Is it Cirrus?

Mr Hood : Yes, Cirrus.

Senator XENOPHON: Just looking at it, maybe I have misread it. There does not appear to be any mention there of the three-hour period when this occurred when not only was there a breakdown in communication but, arguably, loss of separation, given what occurred. Can you take that on notice? I do not see any reference to that. If there is no mention of the time in this seminal report, as distinct from what was answered on notice, I would have thought that CASA and the ATSB would have taken much more interest in it if it was a three-hour time period. How many aircraft movements can you have out of Melbourne Airport—one a minute?

Mr Hood : Probably up to 60 or so, depending on which runway and the configuration.

Senator XENOPHON: Sixty an hour? If it is a three-hour period we are potentially looking at up to 180.

Mr Hood : Sixty in a three-hour period—20 or so departures per hour.

Senator XENOPHON: So if you are looking at 60 and if you are looking at major passenger aircraft you are looking at a number of thousand passengers that may have been on the deck.

Mr Hood : I am happy to take that on notice, Senator.

Senator XENOPHON: You said you were undertaking your last operations which will inform the full circumstances and then you will give an update to the committee which will be provided when it is finalised. Can you indicate when that review will be provided to the committee—or has it been provided and I blinked and missed it?

Ms Staib : When we spoke about that issue last time, I gave the undertaking that we would furnish that report to the committee. At that time I thought it would be ready in January. I apologise, but because it is going through a complete review with CASA and the board—

Senator XENOPHON: What time frame are we looking at?

Ms Staib : April. As I committed to, we will furnish that report.

CHAIR: Has the head contractor at Port Hedland gone into liquidation due to non-payment from Airservices?

Ms Staib : The head contractor at Port Hedland working on that project has gone into liquidation, but nearly all the work had been done and payments by Airservices had been made. There was an amount outstanding. One of the arrangements we had in place for that contract was that, as milestones for payment were approached, we insisted that the head contractor provide a statutory declaration to us to say that they had paid their subcontractors.

CHAIR: I advise Airservices that I think it might be appropriate if we have a confidential briefing, because I have information here—which I will not deal with now—which indicates some serious financial mismanagement at Port Hedland by a range of people.

Ms Staib : I would be very happy to provide that confidential briefing, including all the financial details.

CHAIR: Thank you all very much.

Proceedings suspended from 20:56 to 21:21

CHAIR: We are going to try to put as many questions as we can on notice. It appears that we may have to have—which I am not happy about—a small spillover on Friday week. Could I go to the destruction of the floodplain on the Georges River adjacent to the Bankstown Airport. Bankstown Airport, as you know, is a conundrum. It was hived off by the Commonwealth to a company that is a pain in the guts. Could someone explain to me what the environmental approval process was on the build-up of the floodplain?

Mr Mrdak : Certainly, Senator, I will ask Mr Doherty to give you a briefing, or Ms Horrocks.

CHAIR: Who authorised it? Let's go there. Who authorised the floodplain?

Mr Doherty : Senator, I wonder if you could be specific? Bankstown Airport has been under development for a period.

CHAIR: The south-west corner. Have you been there and had a look?

Mr Doherty : Yes.

CHAIR: The floodplain has been filled. I want to know: what was the source of the fill, what was the approval process, and I would like to see the approval? Who actually authorised the fill of the floodplain? The local residents now have woken up, as you would if you were out on a farm or lived at St George where they put levee banks up which keep the flood out of the town but flood someone else. By filling up the floodplain at Bankstown Airport, if there is a serious event, it is going to flood houses.

Mr Wilson : If I could start and then Ms Horrocks could add some additional detail. I do not have the date at which the approval was granted, but the airport building controller, who is employed by the Commonwealth, the department, approved the development on the government's behalf. The fill is from lot 803 which is on the site. The work is underway as we speak, and will continue underway. The building controller on site will monitor that work. As you would be aware—and we have had this conversation before—Bankstown Airport Limited has a flood mitigation strategy in place, but they have recently agreed with Bankstown City Council to undertake an additional piece of work. So they will work together with Bankstown City Council to undertake a flood mitigation strategy for the surrounding area as well as the airport site.

CHAIR: Could you provide to this committee the environmental approval that allowed that build-up to be done?

Mr Wilson : Certainly, Senator. I do not have it with me, but I can take that on notice.

CHAIR: In relation to the fill that was used was it, for environmental purposes, remediated as it was filled?

Mr Wilson : Senator, the advice I have here is that they have identified that there are small quantities of fibrous asbestos in the fill—

CHAIR: It was a complete bullshit process.

Mr Wilson : and they are monitoring it.

CHAIR: Well, it was allegedly done with an environmental approval and the fill contains asbestos. This is a dodgy deal, let me tell you.

Mr Wilson : We are currently looking into the issue associated with that fibrous material. I do not have a report with me in terms of the quantity per cubic metre.

CHAIR: No, you are going to have to pull the whole of the fill out to find it. Let me tell you, I am in the business, I know. This is a breach of the Airports Act 1996. What action is being taken to remove the contamination?

Mr Wilson : Senator, the advice I have is that it is not a breach of the Airports Act—

CHAIR: Well, we have conflicting legal advice.

Mr Wilson : because the works are being undertaken in accordance with—

CHAIR: The works were not undertaken as per the environmental approval. You have got dodgy guys who knocked down some stuff and said, 'Shit, we'll dump it over there,' and it is full of bloody asbestos. There was no supervision. I will go in camera if you want me to tell you the dodgy guys behind it. The destruction of the flood plain is a breach of the state Environmental Planning and Assessment Amendment Act as well as the federal environment act. Why was the flood plain allowed to be destroyed? I can tell you why—because a couple of developers wanted to get a quid, but go on, you give me your answer.

Mr Wilson : Senator, I cannot give you the approval. I do not have the approval with me now. In terms of the claim in regard to a breach of the New South Wales environmental act, that is not the case. The New South Wales environmental act does not apply because it is a Commonwealth site.

CHAIR: The state land is owned by the Commonwealth, but it is under the law of New South Wales. I am sorry to have to tell you that.

Mr Wilson : I am sorry, Senator. It is Commonwealth land; it is not under the law of New South Wales.

CHAIR: It is registered in the state of New South Wales as a Commonwealth folio.

Mr Wilson : Which means that it comes under Commonwealth law.

CHAIR: Clause 30 of the lease over this land says that the lease is governed by and construed in accordance with the laws of New South Wales. Refer yourself to clause 30.

Mr Wilson : Senator, I do not have the lease with me.

CHAIR: Well, I do.

Senator BACK: Again, are we going anywhere with this? Is the officer going to get a chance to answer, or are we taking it on notice?

CHAIR: He is answering.

Senator BACK: No, he is not. You are not giving him a chance to.

Mr Wilson : Without seeing the clause, Senator, and the context in which the clause is written, I cannot answer.

CHAIR: Well, I will just go a bit further if you cannot answer. I will just give you a few other tips. The certifier of this process was a private certifier?

Mr Wilson : He is our building controller.

CHAIR: A private certifier cannot approve the destruction of a flood plain, only the relevant council.

Mr Wilson : Senator, in accordance with this—

CHAIR: In this case it is Bankstown City Council.

Mr Mrdak : What we might do, Senator, is, if you could set out the issues, then we will answer what we can tonight or take them on notice and give you detailed answers. So, if you could give to us your questions or assertions.

CHAIR: As you know, the destruction of this flood plain is going to have an affect on the residential people in the area in the event of a flood incident. It is going to have a serious impact on the people who have had nothing to do with this dodgy deal, but who happen to live adjacent. The flood plain has been filled and the flood has to go somewhere. The council knows about it and the guys that did it knew about it as they were doing it. To add to that the fill, which was the cheapest that they could find, is full of contaminated material, which allegedly was supposed to be supervised under the environment approval process. I rest my case. You have a problem, boys.

Mr Mrdak : Senator, with those matters, we will take them up and come back to you with a detailed response.

CHAIR: Thank you.

Senator LEYONHJELM: I will be much quicker. At the last estimates I asked Treasury about the issue of aviation or shipping cabotage restrictions and options to reduce them. I was told that Treasury is aware that work has been done elsewhere in the public service on these issues and 'we have contributed a briefing, if you like'—those are Treasury's words. Will your department release documents it has worked on in the past year on aviation cabotage restrictions and options to reduce restrictions?

Mr Mrdak : I am not aware of any specific work that we have done on aviation cabotage in that form. There have been proposals—for instance, our response to the Harper competition review. As indicated, I am happy to provide you with that material—our submission to the Harper review—but I am not aware of any specific proposals that we have worked on in relation to aviation cabotage beyond that competition review.

Senator LEYONHJELM: I am perplexed. Treasury said somebody did and I assumed it was you.

Mr Mrdak : We certainly did provide a submission to the Harper competition review, which I am very happy to provide you, which sets out our comments in relation to the proposal in the competition review to look at aviation cabotage.

Senator LEYONHJELM: I would like to see it.

Mr Mrdak : Certainly. I am happy to provide that.

Senator LEYONHJELM: Thank you very much. How have reduced aviation cabotage restrictions within Europe and the US affected prices and services, as far as you know?

Mr Mrdak : The United States has not opened up its domestic market. The United States operates a very restrictive regime in relation to the capacity of foreign ownership of its domestic airlines. Australia operates one of the most liberal foreign ownership regimes. We permit 100 per cent foreign ownership of domestic carriers that are based in Australia. There have obviously been a number of examples where foreign carriers have set up Australian entities. In relation to Europe, access to the domestic market is only available to EU based carriers and is part of the European union arrangements. Access within the EU is available to EU based carriers owned by EU nationals. It is a different situation. Ownership restrictions tend to also dominate. Australia is one of the few countries that has opened its domestic market through easing foreign ownership restrictions but also through our single aviation market with New Zealand, where we permit New Zealand carriers to operate in our domestic market. We have reciprocal access to the New Zealand market.

Senator LEYONHJELM: That is all I have.

Senator BULLOCK: I would not have done this except that the Harper review was mentioned. I note from your submission, Mr Mrdak, that you said:

… the Department considers the current policy of reserving the Australian domestic market for Australian-based airlines ensures domestic airlines all operate on the same level playing field in relation to industrial relations and taxation, as well as under the safety and security oversight of the Australian Government.

I wonder why the government believes that a level playing field on industrial relations is important in domestic aviation legs on international aviation.

Mr Mrdak : The specific proposal was to look at opening access for international carriers to the Australian domestic market, which is what was being flagged in the competition review. Our view is that any such opening of the market would have a number of implications, not least of which is that Australian carriers operating under Australian industrial relations requirements would be at somewhat of a disadvantage in their operating costs relative to foreign carriers in that market. For those reasons, we believe it would not be a fair and balanced opening of the market were international carriers able to operate under the industrial relations systems of their foreign country and able to operate under the safety regulation of foreign oversight.

Senator BULLOCK: Mr Mrdak, I just could not agree with you more. I ask the minister whether she holds the same view with regard to the domestic legs of international shipping.

Mr Mrdak : I will add that the Australian government is looking at various options for the coastal trade. That is a separate consideration to what is the department's—

Senator BULLOCK: But your logic was so persuasive.

Mr Mrdak : It is fair to say that they operate in completely different markets.

Senator BULLOCK: We did hear today from the track people that coastal shipping was impacting on rail and that there were also concerns expressed by other logistics companies. It is not a totally different market to other transport sectors.

Mr Mrdak : I would be interested to see some of the data in relation to the impact on coastal shipping, because the alternative position being put by many in transport and the users of shipping is that there has been some restriction in relation to access to coastal shipping over the last few years. There is a counterargument put by many shippers that, over the last three to four years, there has been a reduction in availability of foreign shipping.

Senator BULLOCK: I am on your side, Mr Mrdak, because I think that the arguments for a level playing field with regard to industrial relations, taxation and safety trump those other considerations, but I might be biased in your favour.

Senator STERLE: We will have some more conversation on that. Minister and Mr Mrdak, there has been a suggestion put to the committee, amongst the committee, with the indulgence of the chair, me and committee members, that we will do our best under the circumstances to keep going tonight to see if we can finish and avoid a spillover day. Bear in mind, all those out there listening, I would sincerely ask: there are senators who are full-time members on this committee and have sat here day in and day out, so, if senators are out there who think it is an opportunity to come in and run their own little thing and we have never seen you before, I would ask you to sincerely contemplate putting your questions on notice and extending the courtesy to the full-time members of this committee and the senators who had advised the secretary that they wanted to ask questions prior to the last half an hour. On your behalf, Chair, I push that for tonight. Chair, we have finished with aviation and airports. I have questions that we will put on notice.

CHAIR: If senators are not here to ask questions, they can put them on notice for ATSB.