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Wednesday, 24 November 1993
Page: 3512


Senator IAN MACDONALD (11.02 a.m.) —The Aviation Fuel Revenues (Special Appropriation) Amendment Bill 1993 amends the Aviation Fuel Revenues (Special Appropriation) Act 1988 to enable duty on aviation kerosene, avtur, to be appropriated to the Civil Aviation Authority. At present, the act enables the assessment only of aviation gasoline, avgas, with duty. The appropriation of duties paid on avtur, along with the increase in duty paid on avgas to the CAA, is part of the government's aviation cost recovery agenda for safety regulation.

  The question of who should fund the cost of safety regulation, the government or the industry, has been quite a controversial one. The argument for government funding of air safety regulation rests on the belief that it is the government's responsibility to provide safety for the public from an industry which operates in public airspace. The argument in favour of industry funding rests on the belief that, if it were not for the existence of the industry, there would not be any need for safety regulations and that, therefore, these regulations should be the industry's responsibility.

  There is certainly a case for considerable general revenue funding of aviation safety. The need for prevention of accidents which might occur in the airspace—in which debris might fall on people's houses or property or on people themselves, and these people may have no connection at all with the aviation industry—certainly makes it a matter for general funding rather than industry specific funding. I guess it is a question of degree.

  Of course, search and rescue operations, which have cost an enormous amount of money and which are paid for out of the general purse, need to be taken into account. Any accidents we can prevent, of course, would prevent spending of general funds on those search and rescue operations. I highlight the information that I was given at the estimates committee that the search and rescue operations arising out of the recent tragedy of the aircraft which was lost in the Blue Mountains last month entailed a cost of $599,000 for the hire of the search aircraft alone.

  Since the establishment of the CAA, the government's position on aviation safety funding has reflected the controversy about who should pay, shifting back and forth between government funding and industry funding, to the most recent position of 50 per cent joint funding. At the time the CAA was established, the government agreed to fully fund aviation safety. This position changed in the 1991 budget when it was announced that there would be full cost recovery from the aviation industry for aviation safety regulation, to be phased in.

  In the 1992-93 budget, however, after intense lobbying by the industry, the government changed its position again when it agreed to meet 50 per cent of safety costs to a limit of $22.8 million. This arrangement is to be phased in over a two-year period starting on 1 July. Discussions thus far with regard to this newest government safety regulation agenda have consisted primarily of the CAA proposal for some sort of licensing fee system. This proposal, when announced, failed to gain the support of the industry and the matter has therefore been placed under yet another review to determine what should be done.

  While this review continues, the government has gone ahead with three interim measures which are consistent with the 1992-93 proposal to phase in cost recovery from the industry. The first of these measures is a fee to be imposed upon the international operations of Australian aircraft. This fee is to be collected directly by the CAA and the fee is being imposed because fuel used by Australian airlines on international services is exempt from the duty.

  The second measure has been to increase the duty paid on avgas by 0.264c per litre. This increase in duty will raise about $250,000 for the year 1993-94 and is to be collected by the Commonwealth and appropriated to the Civil Aviation Authority. Prior to this increase, the government collected 22.735c per litre from avgas users which was appropriated to the CAA. It is estimated that for 1993-94, $21.8 million will be gained. This duty is not for safety regulation alone, but is for the normal services provided to avgas users by the CAA. Although the duty on avgas has increased to 22.999c per litre, only 0.264c per litre of this will be used for safety regulation.

  The final measure has been to restart the collection of a duty on avtur of 0.264c per litre. This duty is expected to raise $3.35 million for the year and will also be collected by the Commonwealth and appropriated to the CAA. The collection of this duty on avtur was stopped in July 1988. Unlike the other two measures, this measure is not provided for by existing legislation, hence the need for this bill. The purpose of this bill is to allow for the appropriation of avtur duty.

  The government has stated that the three measures together will reduce the government's outlays by around $4.5 million. There is some suggestion that this estimate is an incorrect guess and an overstatement for a couple of reasons, one of which is that there is really no correct estimate of the amount which will be raised from the avtur duty because the charge has not been in existence since it was last abolished in 1988.

  The financial consequences of this bill represent a definite move towards recovering some of the cost of aviation safety regulation from the aviation industry. The importance of this bill is that it represents a move towards yet another government position for funding aviation safety regulations. My concern is that, in the process, aviation safety will be compromised. I urge caution on just how much funding should be recovered from the industry.

  I am worried that the government's constantly changing position on aviation safety funding will result in a reduction in safety funding, closely followed by a reduction in safety standards. Too often we see this Labor government skip from one unresearched policy to another without studying the effects of these policies.

  Because general aviation in Australia has had such a difficult last few years—with 14 per cent and 16 per cent per annum declines respectively in activity—it is necessary for the government to be very careful when implementing policies which affect the industry's pocket. The government must remember that safety and economic stability go hand in hand in the aviation industry and any policy which has the potential to jeopardise the balance between these two must be watched very closely.

  Since I raised in the Senate estimates committees the recent crash of the Piper aircraft of Monarch Airlines at Young on 11 June this year, I have had many approaches from people in the industry who have told me that that particular aircraft never should have been flying. The airline was known to be struggling financially and losing money. Many reports have suggested that the airline was cutting corners in maintenance and safety simply to stay afloat. I have been told that airworthiness inspectors had been trying to get the air operators certificate for Monarch Airlines cancelled because of grave concerns they had about lack of maintenance on Monarch.


Senator Collins —I rise on a point of order, Mr Acting Deputy President. My point of order is very simple and has been alluded to in the Senate before. The entire issue that Senator Ian MacDonald is so irresponsibly canvassing is sub judice and an opinion has been circulated by the Clerk to that effect. More relevant is the fact that this issue has absolutely nothing whatever to do with this bill.


Senator MacGibbon —On the point of order, Mr Acting Deputy President: I have not discussed this matter with Senator Macdonald, and it is a surprise to me that he raised it, but there is no substance at all to the claim that what he is saying—and I am listening very carefully to what he is saying—would have any effect at all on either a departmental or a coronial inquiry. He is just recounting what his experience has been in relation to it, and he is perfectly entitled to follow the line of argument he is following.


Senator Ian Macdonald —On the point of order, Mr Acting Deputy President: what I am saying has nothing to do with matters being investigated by some inquiry. Secondly, the inquiry is simply a coronial inquiry and there are legal precedents to suggest that until someone is charged, the matter does not become sub judice. I understand that in a recent case in Melbourne, where the 707 incident was being investigated, there was no hesitation in the press commentary or any other commentary about that matter because it was simply a coronial inquiry, which is an investigation. It is not a criminal investigation, and for that reason it is not sub judice.

  Even if I were talking about the actual crash, it would not be sub judice. Mr Acting Deputy President, I ask you to recall exactly what I have said. I am not talking about that crash; I am talking about the airline that operated that particular aircraft. There is no way that it would be sub judice even if sub judice applied. But sub judice does not apply because there are no criminal charges currently being investigated.

  The ACTING DEPUTY PRESIDENT (Senator Chapman)—The Clerk of the Senate has previously offered advice on this matter to the effect that matters that could be raised at a coronial inquiry, which can be heard before a jury, should certainly be avoided. On that note, I ask you to certainly bear in mind the nature of the coronial inquiry and be very careful as to how you address the issues.


Senator IAN MACDONALD —Thank you, Mr Acting Deputy President. I will take your warning to be careful in how I address the issues, but I am being particularly careful. The last thing I would ever do is argue with you on a ruling you would make because I would accept any such ruling without question. I take all that into account. But I ask you to carefully consider what I am saying and make some judgment as we go on as to whether or not I am talking about the particular crash that is being investigated by a coronial inquiry.

  Monarch Airlines, an airline in public operation in this country, was known to be in financial difficulty. There was a lot of informed comment that it was cutting down on maintenance and safety responsibility. This was reported to the administration of the CAA by airworthiness inspectors and no action was taken. This is not an isolated instance. It happened with another airline, a commuter outfit at Wagga. The air maintenance inspectors there tried to have the air operator's certificate cancelled for the same reason—they were concerned about safety. Again, the administration of the CAA in Sydney did absolutely nothing about it. As a result a senior AMI from the Wagga area was subsequently transferred in a dispute with the administration over this particular matter. Fortunately, that airline operating out of Wagga folded up and went out of business before any tragedy happened as a result of its maintenance record.


Senator Collins —Do you want to get back to the bill, Senator Macdonald? This has nothing to do with this bill.


Senator IAN MACDONALD —This matter is symptomatic of this government and this minister's inability to do things about the CAA and air safety regulation, which is directly employed in this bill because this bill pays for air safety regulation.

  My concerns in relation to the CAA's administration of air safety were heightened when I learned that last Wednesday week an Eastern Airlines aircraft operating out of Tamworth was told—at about 6,000 feet out of Tamworth—to reduce speed. The air crew retarded the power levers to reduce speed. When the power levers were retarded, the ground spoilers activated. These are lift up devices on the top of wings that destroy the ability of the wings to produce lift. They are designed to operate only with aircraft on the ground to provide assistance to the brakes. The aircraft then suffered considerable loss of altitude at a rapid rate and the air speed decreased by 100 knots. Fortunately, recovery was achieved by the air crew. But had this malfunction occurred during a landing approach phase, the outcome could have been quite disastrous, as could have been the case had the aircraft been in a holding pattern over Sydney at the time when, with that sudden drop, it could have fallen on other aircraft in the holding pattern.

  I understand that the incident occurred as a result of faulty maintenance due to replacement of torque links on the main undercarriage assemblies at the Tamworth maintenance facility of Eastern Airlines. How could such a potentially serious incident occur? I believe this to be yet further evidence of a growing picture of declining standards of air safety in Australia. The root cause in this particular case was the lack of maintenance control.

  Since I have become involved in this matter through many approaches prior to the estimates committee, the number of people who approach me with real concerns about air safety in Australia are growing. The minister does nothing to assist. The minister was a failure as Leader of the Opposition in the Northern Territory. He failed in waterfront reform. He was an absolute joke—a complete and abject failure—on pay TV matters. In regard to the tax control system, which he was not quite involved with, he said subsequently that he would not have let the investigation go ahead. He is an abject failure, and that is because he cannot listen.


Senator Collins —You great oaf.


Senator IAN MACDONALD —It does not matter whether one is at an estimates committee or in a situation like this, he will not listen. He will sit there and yell out intelligent interjections such as, `You great oaf', as he just did.


Senator Collins —You great oaf.


Senator IAN MACDONALD —That is very intelligent—very intellectual.


Senator Collins —I rise on a point of order, Mr Acting Deputy President. As usual, I have been extraordinarily tolerant about this but it has been going on for 10 minutes now. We all have homes to go to; we all want to get out of here this decade. For the last 15 minutes, we have heard nothing which has anything whatever to do with this bill, which is a simple bill to increase a fuel excise by 0.2c a litre.


Senator Panizza —On the point of order: the question of relevance as it applies to speeches by ministers has been raised quite often by honourable senators on this side of the chamber. Generally, the President allows a wide ranging debate.


Senator Collins —Ha!


Senator Panizza —He does; Senator Collins should ask him himself. Senator Ian Macdonald still has some time in which to speak and he should be allowed to use it without further interruption from the minister.

  The ACTING DEPUTY PRESIDENT (Senator Chapman)—It has been the practice in this chamber for second reading debates to range fairly widely. I do not take the point of order from Senator Collins. Perhaps if he were more orderly with his interjections, it would not encourage a reaction from Senator Ian Macdonald.


Senator IAN MACDONALD —It is part of Senator Collins's normal practice that, when he is in trouble with people pointing out his failings and the failings of his department, he will do anything to try to stop people being allowed to exercise their right of free speech. He is trying to stop me speaking in the chamber. He knows that I have only a couple of minutes left. He is desperately trying to stop these things being made known to the public.

  As I was saying, while it is not Senator Collins's fault per se, his trouble is that when people come to him and say, `These are the problems with airline safety regulations. Will you please listen to us?', all they get is what I get in Senate estimates committees—a 20-minute soliloquy about how good Senator Collins is and what his experience in aviation is. He knows everything about everything; he is the ultimate know-all. He then goes on and tells us about his wife and his children. It happens every time in estimates committees. That is what happens to people who come to him with concerns about safety regulations.

  The minister will not listen. He feels that he has got to get up and pretend that he knows everything about anything. If only the minister would listen. If only he would take notice of people who have a concern and a care for air safety; people who come to the minister in the hope that he will do something about it. But all the minister does is say, `Yes, I understand. This is my experience. This is what I know about it. I've flown planes. I've done this'. And so it goes on. If only the minister would listen, take these complaints seriously and do something about them.

  People come to me and say that they have a genuine concern about air safety, that they want something done but that the minister will not listen. Just as the minister is doing now, he will not listen. He has got to be the star of the show. If only the minister would listen to the concerns that people are raising with him and do something about them. If only he would listen to people's concerns about the lack of maintenance; he should listen to their concerns that although airworthiness operators are trying to tell CAA that something is wrong, CAA is not listening. If the minister took those complaints and investigated them, maybe we would not have these tragedies.

  Something is wrong with the state of aviation safety in this area. People keep approaching me after they have tried to raise matters with the minister. They come to me because nothing happens. There needs to be a shake-up. The minister needs to listen or get out of the job—I think the job is too big for him. There needs to be safety regulation. This bill provides money for safety regulation, and in that regard it is good. The opposition will not be opposing the legislation. However, we will be watching its implementation very carefully to ensure that we get the best deal for air safety out of the money we pay for it.