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Friday, 10 December 1965

Mr BOSMAN (St. George) . - I rise with pleasure to support this Bill, perhaps with greater pleasure than usual, because of the infiltration of the Christmas spirit into the chamber. Everybody seems to be agreeing on one line of thinking in their concern at the magnitude of the subsidy extended to airlines in Australia by the Department of Civil Aviation. There is no doubt, as the Deputy Leader of the Opposition (Mr. Whitlam) said, that civil aviation in Aus: tralia receives the greatest subsidy per medium of departmental accounts than perhaps the whole of the other transport systems in Australia put together. 1 certainly agree with his observation, and indeed, with the observations of the honorable members for Chisholm (Sir Wilfrid Kent Hughes) and Mackellar (Mr. Wentworth) in their appreciation of where we are going in civil aviation from now on. I say that because I do not believe that up until now we have been able to do much about it. Again, there will not be any argument but that civil aviation has made a tremendous emergence since the war years and has expanded extremely rapidly as compared with other forms of transport. This required a very balanced approach by governments. lt is interesting to note that throughout the world many governments found themselves in extreme difficulties and lost tremendous amounts of money over a period of time in the field of aviation. Not the least of these was the United Kingdom Government. However, it was obvious that Our Government was aware of this situation in the early 1950's, when there were many problems. But now we have a balanced and rational airlines system. This is conceded today on both sides of the House. The co-ordination is excellent. The airlines are operating in an acceptable financial manner although some aspersions have been cast on Mr. Ansett as to just how much he is making out of the aircraft activities he is engaged in as compared with his other Operations. Nevertheless, the whole position seems to be balanced up to the point at which we come to the Department of Civil Aviation.

The Department, as I indicated earlier, no doubt carried out its function in a reasonably capable manner. It must have done so to have been able to bring the airlines system to the situation in which we find it today. But now we are ready to move into another phase, although we are shackled somewhat by the Airlines Agreements Act. This Act was renewed in 1961 in adverse circumstances because of the economic situation at that time. Aircraft passenger traffic had dropped quite substantially and no doubt the agreement was negotiated on the basis of the trend of figures in that year. The situation now is that the Department has to have a look at the question of running the airline system throughout Australia on an economical basis, possibly as a business undertaking, and the people who use the airlines must be prepared to pay for them. The Government has collected money from these people over a period of time per medium of these airport facility charges and navigational charges. I wonder if this is the right manner of going about it. Some doubt has been cast on this procedure by the Deputy Leader of the Opposition and I must admit that I do not entirely disagree with him as to whether or not the increases in air fares which followed the increased charges levied by the Government by way of air navigation charges were just intended to cover the increases, or whether a little has been added for the balance sheet. I am not entirely prepared to disagree with his observations on this point.

I wonder, again, whether we should now consider making some form of direct levy on the passenger traffic in the airlines system, bearing in mind that we are obliged to provide certain facilities under the airlines agreement. Those people who use the airlines gain great benefit from them. It may be interesting to consider the method of levying these navigational charges at this point. I notice from reading this current legislation that, first, the Director-General of Civil Aviation will have power to fix what is called the " all-up " weight of the aircraft which are used on Australian air routes. For instance, the Fokker Friendship is listed as having an all-up weight of 42,000 lb. Tha Viscount 800 has an all-up weight of 72,500 lb.; the Electra is assessed at 116,000 lb.; and the Boeing 727 at 152,000 lb. The method which the Department is using is to place the various weight groups into four distinctive categories. The first category is those aircraft with all-up weights of up to 25,000 lb. The second is those with an all-up weight of between 25,000 lb. and 50,000 lb. The third is those with an all-up weight of between 50,000 lb. and 100,000 lb. The fourth group contains those aircraft with an all-up weight in excess of 100,000 lb. For each of these four categories, there is a unit charge per 1,000 lb. For the first group the unit charge is 6.58 pence per 1,000 lb. or part thereof. The figure for the second group is 10.24 pence per 1,000 lb., or part thereof. The third group is fixed at 13.17 pence per 1,000 lb. or part thereof. The fourth group is assessed at 15.37 pence per 1,000 lb. or part thereof. Multiplying those charges by the all-up weight of various aircraft we find that the basic unit charged for a Friendship would be £1 15s. lOd. to take off from an airport. For a Viscount it would be £4 0s. 2d., an Electra £7 4s. 9d. and for a Boeing 727 it would be £10 6s. 3d. For the Boeing 707, an international aircraft, it would be £18 3s. 4d.

This is the unit charge, but the Department has a factoring system which it applies to all the airline routes. The factor for a particular route might be any number up to 14. The Sydney-Melbourne route, for instance, is given a factor of four, and for a Friendship. which, in fact, rarely flies the route, the unit charge of £1 15s. lOd. would be multiplied by four, giving a figure of £7 3s. 4d. The figure for the modern Boeing 727 would be four times £10 6s. 3d., or £41 5s. for every flight between Sydney and Melbourne.

Sir Wilfrid Kent Hughes (CHISHOLM, VICTORIA) - Is that for the complete trip?

Mr BOSMAN - From take off to landing - the complete trip. For the SydneyPerth route the factor is 13, so that for a Boeing 727 the figure would be 13 times £10 6s. 3d., or £134 ls. 3d. for every flight between Sydney and Perth. If we go a little further with our calculations and consider a Boeing 727 on a flight between Sydney and Melbourne with a full load, the cost per passenger would be about 10s. If we go even further and divide that cost by the number of miles flown we find that it would cost about one farthing per mile per passenger.

These charges are based on the facilities offered by the Department of Civil Aviation. They include the safety facilities, such as beacons, instrument landing systems and so on, and also, of course, the runways and terminals. This one farthing per mile would cover a passenger from the time he arrived in the airport area at the point of embarkation until he departed from the airport area at his destination. A charge of one farthing per mile or 10s. for the trip between Sydney and Melbourne seems to me a very reasonable charge for the safety and other facilities available.

We are obviously bound for some years to come by the Airlines Agreement Act to restrict any increases of air navigation charges to a maximum of 10 per cent, per annum, but I wonder whether the Government should consider some means of levying a charge on the people who use the aircraft instead of giving a subsidy from the general revenue. Under the present system the whole of our population subsidises the people who travel by air and who gain great benefits from the advances and huge expenditure that have been made in civil aviation in Australia. I suggest to the Minister for National Development (Mr. Fairbairn), who is now at the table, that the Government might consider a direct tax on passengers. It could use the airline companies to collect the money, and the fact that the levy was being made could be specifically stated on the tickets issued by the companies. Many countries impose an individual tax on users of airports. Apparently this has been found distasteful or unsatisfactory in Australia, or perhaps it has been considered that there is no requirement for it. We must remember, however, that the Department of Civil Aviation has introduced developments over the years which have brought the Australian airline system up to a high standard, and it is time now for the Department to look at its own internal financial system. We should endeavour to lower the charge made on the general revenue of the country and use some more positive means of obtaining the necessary revenue for the Department.

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