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RURAL AND REGIONAL AFFAIRS AND TRANSPORT LEGISLATION COMMITTEE
17/06/2010
Customs Tariff Amendment (Aviation Fuel) Bill 2010; Excise Tariff Amendment (Aviation Fuel) Bill 2010

CHAIR —I welcome representatives of the Regional Aviation Association of Australia and Regional Express Airlines. Gentlemen, before we go to questions I invite you to make an opening statement, if you wish, bearing in mind that we have got time constraints and we would urge you to make it brief.

Mr Tyrrell —Just to explain who we are, the Regional Aviation Association of Australia represents 24 air operators and about 45 other businesses that offer services to those regional air operators. Today we are here to analyse with you whether this is an equitable increase in excise. We are unsure how it is going to affect our industry and both Jim and I would like to discuss with you how that increase is going to be used. To a certain extent we are unsure whether we are getting a fair go, basically, with respect to this excise. It is our understanding that it is the domestic operators that pay the excise and we wonder if that is an appropriate way in all cases to fund the increase to CASA for the extra services it wishes to offer. Jim, did you want to add something to that?

Mr Davis —No, they are pretty much our concerns. It seems that the domestic operators do pay the fuel levy. CASA has a wide brief. CASA is responsible for all sectors of the industry. The domestic operators pay the fuel levy, which under the proposal in the budget is going to be the majority of the funding for CASA’s surveillance activities. I would like to keep cost recovery for reg services as a separate function as we are talking about the core safety function of CASA, which under the proposal is more and more being thrown into the fuel levy. What that means is that the domestic operators are shouldering more and more of the burden. There are many other sectors of the industry, such as the major airports—in fact, all certified airports—as well as Airservices Australia and operators that conduct international flights out of Australia. These all come under CASA’s purview and yet they do not pay the fuel levy. So one of our concerns, now that we have got into the model here, is whether this is an equitable system or whether there is an unfair share particularly on the domestic operators and, in our case, the regional operators.

Senator O’BRIEN —I suppose if you analyse it all, the bigger aircraft carrying more passengers pay more of the air services charges and keep air services operating. That is fair too, isn’t it?

Mr Davis —That is correct.

Senator O’BRIEN —In terms of the air traffic issues around major airports, that is where the biggest task is. That is the other side of the equation, where perhaps the internationals pay a larger proportion—perhaps not larger than domestic generally but a larger proportion than the number of aircraft they fly in and out.

Mr Davis —They do. And that money goes to funding Airservices Australia—it does not go to CASA.

Senator O’BRIEN —It sure does, I know, but that is another organisation. The other side of the picture is: on the one hand the charge is paid for air-traffic management—perhaps disproportionate for them—on the other we have an international convention that says we cannot levy these sorts of charges against international aviation, and therefore the charges are levied against the domestic sector. Is it fair to say these charges have been in existence for something approaching 20 or more years and the regime has not been significantly contested by the industry?

Mr Davis —I think that is a fair statement, Senator. What is concerning me in particular, and the RAAA, is that the weighting is changing. If you look forward to the next four years, the funding for the surveillance activities of CASA—currently around 60 per cent funded by the fuel levy—moves up towards 75 per cent funded by the fuel levy. So the weighting is certainly falling more and more on that sector of the industry that pays the fuel levy.

Senator O’BRIEN —I suppose, given the rise in airline passenger traffic, it is sharing the load a bit amongst the travelling public, as a user-pays principle.

Mr Davis —It is sharing the load. In the case of my airline, Rex, the proposed extra charge is about $300,000 a year. I am not able to say what we are getting for that money—what the benefit would be to Rex in terms of CASA’s activities. I do not know that CASA can operate with Rex much more efficiently than it is. We see a very robust surveillance regime from CASA where we are, so we do not see that. Also, we cannot necessarily pass that $300,000 straight back to the travelling public. It is a cost, to some extent, we have to absorb and on our scale of operations it is a significant cost.

Senator O’BRIEN —So when fuel prices move because of the market, how do you cope with that?

Mr Davis —We absorb as much as we can. We are a very competitive industry. Of course it gets to the point where you cannot absorb it, because fuel prices are a tremendous part of our cost base, and we then have to put in a fuel levy. To some extent, we have found the public does accept a fuel levy, because our competitor is not always other airlines—it is often the motor car. And if the public is paying more at the pump, then they have to pay more to travel by air as well. With any other increase we find the demand is often quite inelastic and we cannot just shove it straight into our fares.

Senator O’BRIEN —From time to time fares move and it seems that there is a recognition of the cost of fuel, but on the basis of fuel movements this change seems to be a lot less significant than some of the rates of movement of fuel over the last five years. Is that a fair comment?

Mr Davis —It is certainly not as large as the price of fuel as it comes in from the oil companies.

Senator O’BRIEN —So what would it have moved in that period? It has gone up and down a bit, but the range of movement in five years probably would have ranged 25 per cent.

Mr Davis —It would have moved far more than that in the last five years.

Mr Davis —And we are talking here about a half a per cent increase, roughly—plus or minus.

Mr Davis —True. We are still talking, in my case, around $300,000—and Paul can talk more for the members—but we estimate the RAAA members will be impacted between $2- to $2½ million extra by this charge. The reason the industry is not the most—

Senator O’BRIEN —Is that per year or over the four years?

Mr Davis —Per annum. That is quite an impost when we do not even know what benefits we are getting. We are not questioning that there may be substantial benefits, but we are questioning whether we are paying more than our fair share. Two million dollars to $2½ million is a lot to absorb. The regional industry, as was mentioned in the government’s white paper, is not the most robust industry—it is a very fragile industry.

Mr Tyrrell —To use the government’s phrase that was in the green paper, Senator, the regional industry was considered by government to be ‘barely profitable’.

17:44:52

Senator O’BRIEN —On the figures you give us, it would pay about an eighth of the increase in charges as a share?

Mr Davis —That is correct—I think that was the question.

Senator O’BRIEN —On regional aviation figures that you give us—$2½ million a year over four years—

Mr Davis —Yes, correct. We are the largest member of the RAAA.

Senator O’BRIEN —So, overall, the regional aviation sector is paying something around 12½ per cent of the overall cost increase—the bulk being paid by the major domestic sector, I take it.

Mr Davis —Yes.

Mr Tyrrell —That would be approximately correct.

Senator O’BRIEN —And that has been the case, historically, for the last 20 years?

Mr Davis —Yes.

Senator O’BRIEN —We have FAA and ICAO on record as saying that our safety regulation staffing and training is not up to scratch and that we need to improve it. Should we respond to that finding?

Mr Davis —Of course we need to look at what ICAO says, but certainly from our point of view the surveillance that we get from CASA, as I said earlier, is quite robust. The people they have are qualified and experienced, and I do not see any glaring holes. As an end user of the system, we feel that CASA do a fairly reasonable job.

Senator O’BRIEN —But independent reviewers looking at the overall picture have come in—and one would assume that they do not make recommendations lightly on a national safety regulatory body—and made findings that it is not good enough; they have to improve in some areas. So the subjective assessment, if I could put it that way, of the industry is not borne out by the objective assessment, as I would see it, of international bodies like ICAO or the FAA.

Mr Davis —That may be, and I am not aware of the details of the shortfalls highlighted by ICAO. I am not familiar enough with what CASA is doing with the extra money to say whether that is an appropriate response. I get back to the point that, even if it is, are we paying more than our fair share to cover that response? Maybe it is more appropriate that it come out of consolidated revenue rather than a select number of domestic operators.

Senator O’BRIEN —I think it is also fair to say that for the last 14, 15 or 16 years there has been a pursuit of some user pays principles in the aviation sector, and this is merely one of them that seems to have existed harmoniously with the industry for that time, and the shares have not changed. So you are suggesting that at this time we should throw it all up in the air and start afresh, forget about the ICAO recommendations and go back to the industry developing some new model and trying to get consensus and then implementing that?

Mr Tyrrell —I think there is also an increase in revenue through industry growth, under the current ratio. Our research is showing around six per cent average growth over the last seven years, and we have no reason to believe that that growth will not continue. There is revenue increase available to CASA. I guess we are not questioning the quality of CASA’s services or the quality of their officers; we are questioning whether this increase and the way the increase is being distributed is equitable and fair.

Senator O’BRIEN —But industry growth means there is more to regulate, does it not?

Mr Davis —Not necessarily. There are economies of scale, and the same airline doing more flights does not necessarily mean CASA has to do more work.

Senator O’BRIEN —But more operators, more aircraft—both of them are realities; there are more aircraft and there is a significantly ageing general aviation fleet, which poses additional regulatory problems.

Mr Tyrrell —That is correct, in part. But there is also an obligation in the future to develop a very robust safety management system internally, which will assist a process that we support. We take safety extremely seriously and it is at least as important to us as it is to CASA. We are working with CASA on a weekly basis on this ongoing development of the safety management systems. That means these are internal resources that companies are going to be bringing to bear and in some ways it is a cost they willingly take on board. It is not just all CASA; it is also within our industry.

Mr Davis —I would like to add to that. It is actually somewhat of a revolution in the industry. These are systems that have been common to the high end of the industry, to the major airlines, for some time, but under ICAO guidelines, and certainly under CASA’s direction, it has now been pushed down into the rest of the industry, certainly at the level I operate at. I have seen a major revolution in the last few years.

For example, around three or four years ago Rex would have spent maybe $70,000 or $80,000 a year on dedicated safety resources. We now spend over a million dollars a year—mainly on staffing but also on software and resources, and I am not counting the time that I and senior managers spend on it. Direct extra resources have been employed.

We are not saying that this is a bad thing at all; in fact, we have seen some positive results from it. We fully support it. I think the point that Paul was making is pretty valid: the industry itself is putting in major resources under this worldwide move towards safety management systems. It is a very good move. I have been converted. It is very effective. That should not be discounted when we look at the effect of safety in the industry.

Senator O’BRIEN —No, but with respect, safety blemishes are big business problems in aviation. If you have a safety blemish you may not have a business for very long. That has been my experience in looking at the operations of CASA and the operations that they regulate. There is a significant self-interest in having a safe operation. As a regular member of the flying public in regional aviation on a not insignificant number of occasions, I welcome investment in safety by the sector, but I know that there are still operators whose safety operations are constrained by their financial capacity. I want a regulator who can find those operators because I know I have flown on some who have subsequently been found not to have been the safest of operators.

Mr Davis —I would argue that is all the more reason not to put extra costs onto that weaker portion of the industry. I refer to the comments from Phil Hurst earlier: it is many straws that break a camel’s back. We have to watch our costs stringently in order to survive in our industry. That is why we are here today—we now question every cost that is put in. We have to or we will not be around in a few years. We have seen a dramatic collapse in regional aviation and in regional airlines in the last 10 or 15 years. Most of the airlines that were out there are now gone. Rex has survived because it does question every cost that comes in.

Mr Tyrrell —I do not think this is a safety debate in any sense. The people I work with are professionals. The people I deal with in CASA are professionals. I have never come across an industry with such a safety commitment. What we are talking about today are the costs, the mix and the way we are going to organise our response to improving our safety.

Senator COLBECK —How did you find out about the new increased charge?

Mr Tyrrell —Initially through the press release and through the budget papers. On that point, there are massive amounts of information that have come out from government and it does take us a week or two to analyse things. We have a huge staff of two. I also have to call on my directors and some of their staff to analyse it. Once we did the analysis we realised that there may have been some issue.

Senator COLBECK —So effectively you had to ferret through the budget documentation to see if there was anything in there that affected you? Nobody rang you to say, ‘This is here’?

Mr Tyrrell —Or if this was coming up, no.

Senator COLBECK —If you looked at the green paper and the white paper, was there any specific reference in those to an increase in excise charges?

Mr Tyrrell —Not to my knowledge.

Mr Davis —No, I am not aware of any.

Senator COLBECK —So just a statement that the government would have to consider its cost recovery?

Mr Tyrrell —That is all we knew.

Senator COLBECK —There was an expectation there might be some additional costs, but you were not consulted on and did not know in what form they might come.

Mr Tyrell —No, we had no consultation on that point.

Mr Davis —There was certainly no consultation. There was in the white paper a commitment given by the government to cap the regulatory service charges by CASA at $15 million a year. That was in order to allow the industry a bit of breathing space. There was an acknowledgement there that the regulatory burden needed to be watched, so it does seem a contradiction when a charge of $22-plus million suddenly appears in the budget.

Senator COLBECK —We have heard today, and you have reiterated, that you were not aware of how the funds might be expended, how they might be directed. Have there been any approaches to you or have you made any approaches to actually get an understanding of that?

Mr Davis —There have been no approaches to me.

Mr Tyrell —I have sought clarification on an aspect, which was clarified. But that was just one conversation. There have been no other conversations.

Senator COLBECK —Where was that clarification sought from and where did it come from?

Mr Tyrell —I sought a clarification from Minister Albanese’s aviation adviser and he assisted me with that question.

Senator COLBECK —But there was not an offer of any broader scale information; it was just a response to your request specifically.

Mr Tyrell —Correct.

Senator COLBECK —How many industry organisations are there that might interact similarly to yours? We know of the agricultural guys who appeared earlier. What number of organisations would there be that fulfil the sorts of functions that you fulfil?

Mr Tyrell —There are probably half-a-dozen major ones in the country.

Senator COLBECK —You talk of the current regulatory and cost burden. What consultation is there directly between you and CASA to actually discuss those issues, to talk about those issues and to have a dialogue on a regular basis to get an understanding of where they are coming and for them to get an understanding of where you are coming from?

Mr Tyrell —I would answer that in two parts: there is the formal and the informal. Phil mentioned the SCC, which is basically regulatory and operational. To be frank, if I have a question on any other matter I try and find someone in CASA to answer it for me informally.

Senator COLBECK —There seems to be, from the two industry witnesses that we have heard from today, a complete lack of information provided from either the government or CASA as to where this is to be directed. This is for safety, and I think everybody understands that. How it might work, where it might work and where it might be applied—the practical application of this is where the information seems to be wanting. I just wonder if there are any formal processes by which that works and, if there are not any, what your views are on whether or not there should be some.

Mr Davis —To my knowledge, there are no formal processes. I have not been involved in any. With this latest proposal the first we saw was the media release on budget night from Minister Albanese’s office, but up to then we did not even know it was coming. When cost recovery was introduced into CASA—and that was purely for reg services, not what we are talking about here today—there was a reasonably extensive consultation process done by CASA. That was the introduction of a whole new system, and they did go to a lot of trouble. They went out and sought out the industry. I myself sat on a working group that formulated the cost recovery. So there have been instances in the past of some good consultation by CASA, but on this occasion it just came out of the blue.

Senator COLBECK —So the expectations that you had around additional cost recovery that came out of the green and the white papers would have related more to the regulatory process and the understanding that you actually had a cap. At $15 million there was no expectation of anything else coming along.

Mr Davis —Absolutely not.

CHAIR —Mr Tyrrell, I am sorry; I was talking to the secretary half way through the questioning. You were talking about your concerns. Have you raised your concerns with the minister’s office?

Mr Tyrrell —I have raised concerns with the minister’s office.

CHAIR —Is it fair to say that the minister’s office sent you an email saying very clearly that if you have any further concerns to please call them? Is that the case?

Mr Tyrrell —I would have to check.

CHAIR —I will help you out. I know for a fact that on 11 June there was an exchange of emails.

Mr Tyrrell —On what date was that?

CHAIR —11 June. The email from the minister’s office clearly says that if you have any concerns you want to raise, please contact them. Have you contacted them?

Mr Tyrrell —I spoke with the adviser about the concern that I had and he answered that.

CHAIR —About the concern?

Mr Tyrrell —Yes.

CHAIR —What about further concerns?

Mr Tyrrell —I have not raised further concerns at this stage.

CHAIR —But you are raising many concerns now.

Mr Tyrrell —I am raising some concerns; yes.

CHAIR —Why didn’t you contact the minister’s office when you had the opportunity? You were asked if you had further concerns to contact them and raise those issues.

Mr Tyrrell —I had my question answered and I was satisfied with that. This is an ongoing process so I am happy to—

CHAIR —Mr Tyrrell, this is not an ongoing process. This came out of the blue yesterday through the Senate, unless you knew that it was coming and we did not. Certainly, government senators had no idea until yesterday. On 11 June you were offered the opportunity, if you had concerns as the CEO of Regional Aviation Association of Australia to contact the minister’s office and you have not.

Mr Tyrrell —I contacted them with the concerns that I had—

CHAIR —You said that. You said ‘a concern’.

Mr Tyrrell —Yes.

CHAIR —And now, all of a sudden you have a heap of other concerns. It did not occur to you that you had the opportunity to contact the minister’s office, which you have done previously. You waited to come here. Government senators did not even know this was coming until yesterday.

Mr Tyrrell —I am not sure what the question is.

CHAIR —I am asking you why you did not raise these further concerns with the minister’s office when you were given the opportunity?

Mr Tyrrell —I have conversations with the minister’s office on a fairly regular basis and I raise my concerns there.

CHAIR —You say that you raise your concerns. You have concerns with this levy. Have you raised any concerns about this levy with the minister’s office on behalf of your members since you raised that one concern on 11 June?

Mr Tyrrell —I do not have a ‘Hansard’ about that. We had a conversation and we talked about—

CHAIR —You do not have a Hansard. I did not ask—

Mr Tyrrell —I do not have a record of the exact conversation. I am just going on memory but the conversation that I remember I had was reasonable and I got most of the information that I needed. I moved on from there.

CHAIR —So you appreciated the clarification and the response from the minister’s office to your concern.

Mr Tyrrell —Yes. Yes, I did.

CHAIR —So for this committee one would assume that, regardless of opposition questioning, you actually have the ability to converse with the minister’s office. You are not shut out.

Mr Tyrrell —No. No, I am not shut out.

CHAIR —As the CEO of your association why didn’t you raise with the minister’s office the concerns you are raising now, when you were given the opportunity to follow up?

Mr Tyrrell —I did raise the concerns that I had at the time.

CHAIR —You raised a concern; you now have other concerns.

Senator COLBECK —Is that a crime, to have new concerns?

CHAIR —No it is not, Senator Colbeck. I am assuming—and you would support me on this—that if the minister’s office is offering the opportunity for a peak association to contact the office and raise concerns they should take that up. Or do you think it would be better to wait for a committee hearing or a legislative hearing that just pops out of the blue on the Wednesday before we rise on the Thursday? Bear in mind that you had conversations on 11 June and that this is not out of the blue; that levy was in the minister’s press release too.

Mr Tyrrell —That is true. It takes us a long time to get through all the information that we receive. It is an ongoing process. We are still learning about the ramifications.

CHAIR —It is $300,000 to use. It is not something that you would sit back and wait a month for. I am sure you would have—

Mr Davis —No, it is not. There are two aspects here. One is: what is the money for and where is it going? If that had been the only aspect we may well have been able to get comfort either from CASA themselves or from the minister’s office as to what CASA was doing with the money. We may well have said, ‘Okay, we understand. That is fine.’ The bigger question to me is about the appropriateness of the funding model. We believe we are shouldering an unfair share—that we are paying more than our fair share. In the past, we have copped that because there has been a considerable component of consolidated revenue, ordinary appropriation, going into the funding. Under the new proposal, the balance shifts dramatically towards those paying the fuel levy. So I do not think any information from the minister’s office would have been able to solve this problem. I think this is something that the Senate needs to look at.

CHAIR —Mr Davis, with the greatest respect, you pay membership fees to an association that Mr Tyrrell heads up. I would have thought that would be an opportune time for the CEO of your association, who had been given the opportunity in writing, to get briefings from the minister’s office. Not taking up those briefings with the minister’s office is something I suggest you might want to have a conversation with your CEO about outside the room. But to sit here and all of a sudden have concerns, Mr Tyrrell, and to leave the committee with the thought that you were shut out of the minister’s office and did not have that opportunity is rather disingenuous, as is saying to this committee that you have all these concerns and you are not being heard.

Mr Tyrrell —No. I have said that some of my concerns were heard—

CHAIR —You said one of your concerns was heard.

Mr Tyrrell —I sought some clarification and that was given to me.

CHAIR —I think we are going around in circles. I think you are playing politics to be honest with you, Mr Tyrrell. Smile as much as you like, Senator Colbeck. We need to get the truth out here and I am glad to have the opportunity  to do that, so I am also going to ask this. Are you aware that the previous government raised the excise 11 times? I am asking both witnesses.

Mr Davis —I was not aware of that, but I accept that it has been raised. Also, I do not know the timing. Probably that was before my time.

CHAIR —I respect that, Mr Davis. Mr Tyrrell, were you aware that the previous government raised the levy 11 times?

Mr Tyrrell —I was not aware of that. I was not in this position.

CHAIR —I am helping you out. In 1999 and 2003 the previous government increased the excise rate for the specific purpose of providing additional funding to CASA. In its last term of office from 2004 to 2007 the previous government more than doubled CASA’s regulatory services charges on industry. So my question to both of you gentlemen is: did you have much to say about the rises at the time? I know you were not here in 1999 but were you here from 2004 to 2007?

Mr Tyrrell —I was not in my position.

Mr Davis —I was not in my current position either.

CHAIR —Please take this on notice. If you did, can you provide the committee with any commentary or clippings so we can get the bigger picture.

Mr Tyrrell —Certainly.

CHAIR —Thank you very much.

Senator BACK —Mr Tyrrell, I cannot recall if you have actually complained to us that you did not have access to the minister’s office. I have not heard that in your evidence this afternoon, but perhaps I missed it. Did you give us evidence that you are dissatisfied or that you had difficulty or failed to get contact with the minister’s office?

Mr Tyrrell —No, I am not complaining.

CHAIR —If I have assumed that, I am sorry. I was talking to the secretary and I may have missed that. For the record, I correct it. I am quite happy with the answers to my questions.

Senator BACK —Thank you, Chair. Certainly I did not hear Mr Tyrrell raising the issue of complaint. Mr Tyrrell, you did make a comment—and can I ask for further clarification—about CASA receiving a six per cent annual growth in its budget. Can you explain further your understanding of that situation.

Mr Tyrrell —Excise is charged on litreage.

Senator BACK —So do you mean a natural excise increase?

Mr Tyrrell —Through growth of industry, volume by volume fuel sales. It has been an average of six per cent over the last seven years.

Senator BACK —Is it your understanding that CASA operates in a surplus or in a deficit situation?

Mr Tyrrell —I do not have knowledge of that.

Senator BACK —I did ask the officers earlier and, unfortunately, you were not able to be here but, from your position in the industry, do you have any understanding of the division of fuel usage in Australia between—let’s call it domestic excisable fuel, military fuel, international fuel? The officers have said they will take that on notice for us, but they did not. I am interested in knowing the proportion of Australian aviation fuel on which this excise is charged?

Mr Davis —We believe—these are just some sums we have done ourselves, without using any resources of the department—that the domestic component, the fuel levy is around 42 per cent and the component which is non-levied, which we assume to be defence and international operations, is 58 per cent.

Senator BACK —Do you have any idea what that 42 per cent represents in millions of litres?

Mr Davis —I think it is 42 per cent of 6.3 billion litres, so 2,800 megalitres.

Senator BACK —I think the department offices and I are in agreement by the time you multiply that figure by 0.072. It comes up to about $22½ million a year and, multiplied by four, is the $88.9 million we are talking about. We may have resolved that. Finally, you were telling us about the impact that a $300,000 increase will have on you. Can you tell us, without perhaps breaking commercial confidentiality, is that likely to put any of your marginal regional air routes at risk? Or, in general, could I ask Mr Tyrrell, is it likely that your members would be likely to have regional air routes at risk?

Mr Tyrrell —I could not state categorically, but certainly the newer members, the smaller members—just to take Jim’s point—will look at every dollar. Certainly, the risk will increase but to what level would be hard for me to categorise.

Mr Davis —Again, it is a matter of the sum of the whole and our costs are constantly increasing—increases due to new regulatory demands. We now spend over $150,000 a year on DAMP testing, and that is a good thing. But it is a cost we have to soak up. The new technology that has been mandated that we have to fit to update a SAAB to the current technology requirements costs around $US300,000 to US$400,000. We are currently refitting our corporate jet fleet, which costs over US$400,000. All of these add up, and I cannot tell you that just another US$300,000 will cause a route to collapse. If we keep adding on these burdens, eventually something has to give. I also do not feel that it is appropriate to say that, just because we can bear the costs, we should cop it. I get back to my point that I think we are paying more than our fair share.

Senator BACK —My final question, given the shortage of time, you heard a reference by the previous witness and I think you also commented on the standard consultative committee, which I understood to be comments more on a technical basis. Could you give us your advice as to what you would like to see in place in terms of a more, if you like, structured consultative process with CASA that would, in the longer term, lead to better inefficiencies and better ineffectiveness of service delivery and, hopefully, better value for money invested. How may that process work?

Mr Davis —I will let Paul comment on the SCC because I have not been involved with that. As far as other non-regulatory matters go, I see a very good model, if I may quote Airservices Australia. With their funding increases they have an industry group that meets every quarter. I think that is a very cooperative process and is quite productive. If CASA is facing a major change in their cost base or their funding, perhaps something similar to that would give the industry an insight into what CASA’s needs are and what it is doing with its money.

Mr Tyrrell —I have been involved in the SCC process a fairly short time compared to Phil, about two years, and it is my impression that it has kind of run its course as a useful structure. It has done some good work in the past, but I think it has become somewhat unwieldy. I believe the CEO of CASA is considering other structures. I am not party to those internal conversations, but I think the SCC process could be improved, perhaps divided into more specific areas and perhaps the committees that hang off them a little bit more focused.

CHAIR —Before we finish, Mr Tyrrell, did you raise the concerns you have had in the last couple of days or so with the shadow minister’s office?

Mr Tyrrell —Did I raise them?

CHAIR —Have you raised any concerns with them?

Mr Tyrrell —I have been contacted by them but I have not raised any myself.

Senator COLBECK —A terrible thing.

CHAIR —Thank you very much. So you have been contacted by the shadow minister’s office and you raised your concerns with the shadow minister.

Mr Tyrrell —I raised some issues rather than concerns.

CHAIR —Sure. But wouldn’t you have thought to pick up the phone and ring the minister then? I have been in opposition, Mr Tyrrell. I understand.

Mr Tyrrell —I have had conversations with both offices.

Senator BACK —When you ring up a client and seek advice from him it is a very simple business.

CHAIR —Thank you, Senator Back. Mr Tyrrell, there are some words of wisdom. If you had followed Senator Back’s suggestion, then you could have spoken to the minister’s office and they may have addressed some of your concerns. Mr Tyrrell and Mr Davis, thank you for your attendance.

Do senators have any questions of the officers before we wind up, or do the officers wish to add anything? There being nothing further, I thank witnesses, the staff, Hansard and Broadcasting.

Committee adjourned at 6.17 pm