Speech for the Regional Aviation Convention - Hyatt Regency Coolum Sunshine Coast
15th September, 2010
Mr Michael Bridge, RAAA Chairman, Mr Stephen Padgett, RAAA Convention Chairman, Board Members, Mr Paul Tyrrell, RAAA CEO, delegates.When I accepted your invitation, I thought I would be speaking as the Opposition spokesman on aviation regarding our policy initiatives for a forthcoming election. When I confirmed my acceptance one month ago, I hoped I would be speaking as the new Minister for Transport announcing our plans for our first year in government. Today I am back to where I started, as Opposition spokesman to talk about our policy for the next election, whenever it might be held.
The election just behind us has delivered the closest result in generations and the new Parliament will be inherently unstable. Nevertheless, the voters have spoken and we as elected members have an obligation to try and make the verdict they have delivered workable.
It has been more than seventy years since independents have been influential in the House of Representatives and they certainly will want their moment in the sunshine to last. This is unlikely, however, to be a courageous government able to effectively address the important issues, because of the inability to secure passage for any legislation that might be considered at all controversial.
For all these reasons the Opposition's policy position on key issues will be more relevant than ever. The policies that we took to the election still stand, but these policies will of course be subject to reviews in the light of new developments and issues which may emerge.
It is a pleasure to be here at the official opening of your annual convention. I understand that this is a significant one - where the RAAA is celebrating thirty years of regional aviation advocacy. From your founding in 1980 as the Regional Airlines Association of Australia to your change in 2001 to the Regional Aviation Association of Australia, the RAAA has established a reputation as an intelligent and effective advocate of regional aviation.
Your organisation's membership directly employs over 2,500 Australians and generates a turnover of more than $1 billion. Your members carry over two million passengers and 23 million kilograms of freight annually. Your membership include representatives from all States and Territories and include airlines, airports, engineering, flight training businesses, finance and insurance companies and government entities. Many of your members operate successful and growing enterprises and provide economic opportunities for rural communities.
I understand that more than three hundred delegates from Australia and overseas are attending this conference, networking and participating in important seminars covering issues such as aviation regulation, safety, liability, ageing platforms, future trends and the one I like -How to Build Your Business While Avoiding Lawyers - good luck with that.
I also thank all the sponsors who make this convention possible. Without the contributions from the nearly forty sponsors, these conventions cannot happen.
The Coalition supports and wants to be a partner in the vision of the RAAA: serving regional aviation, and through it the people and business of regional Australia. As a demonstration of our commitment, when I was Minister for Transport and Regional Services I instigated the General Aviation Industry Action Agenda. This Action Agenda was designed to draw in key players from a diverse industry to get a better grasp of the significant challenges the sector faced. The General Aviation Action agenda was making good progress in 2007, drawing together the participants and assisting policy makers to identify and address the issues at stake.
I was disappointed when the newly elected Labor Government abandoned the Action Agenda. General aviation and much of regional aviation lost the opportunity to work with the Government to fix the problems.
The Aviation White Paper process was the excuse but it provided inadequate consultation. I can reassure you that a Coalition Government will redress this error and build a permanent consultation process between the Government and industry. This was an election commitment.
This claim by the Rudd Government about the White Paper struck me as all the more puzzling when you consider the White Paper actually says very little about regional aviation.
We are told that the Remote Aerodrome Inspection Program, the Remote Air Services Subsidy Scheme and the Remote Aerodrome Safety Program are to be consolidated into the Regional Aviation Access Program. The White Paper also talks about reconfiguring the Remote Air Services Scheme and the Remote Aerodrome Safety Program into a 'hub and spoke' model. Without sounding too sceptical, this discussion sounds like code for cuts and reduced support. What I can assure this audience is that regardless of administrative tweaking, the Coalition in Government will keep these programs.
I also noticed that the White Paper process has flagged the removal in 2012 of the en-route charges subsidy scheme which refunds Air Services Australia's air navigation charges for a number of regional air services. At the election, the Coalition committed to preserve this scheme priority given to supporting low volume and new routes and services to small and remote communities.
A Coalition Government will maintain the ring-fencing of regional slots guaranteeing regional airline access to Sydney Airport at existing levels and continue with the current regulatory regime which caps pricing increases for regional airline aeronautical charges at Sydney Airport to CPI levels.
So I appreciate the White Paper was a bit disappointing to you. It barely mentions General Aviation, it does mention the problem of ageing aircraft, but doesn't propose any solutions. This is a vexed issue - since any industry must ultimately be responsible for its own capital replacement requirements and for many, suitable aircraft are not even being built. Nevertheless, if we spend a small fraction of what we spend subsidising cars, supporting aircraft manufacturing, we could be a key global player.
The White Paper has also left your sector with an issue arising from its approach to aviation safety - the commitment in the Paper to introduce compulsory passenger and baggage screening for aircraft with a Maximum Takeoff Weight of above 20,000 kilograms from 1 July 2014.
The White Paper was released in December 2009. Two months later, in February 2010, the Government in its statement Strengthening Aviation Security announced it was to:
...bring forward screening at a number of additional regional airports that are currently served by larger passenger turbo-prop aircraft.
We subsequently learned through the Additional Budget Estimates Hearings that:
the date for implementation of security screening of regular public transport and open charter aircraft over 20,000 kilograms has been bought forward to 1 July 2012.
The Government followed up this commitment with its announcement in the 2010-11 Budget that it would provide $32 million over four years to help fund this initiative.
Now this decision poses significant implications for air services to a number of country airports.
For example, a Q 400 aircraft has a Maximum Takeoff Weight of 28,998 kilograms, so this aircraft is captured by these new requirements. There are many regional airports in Australia that receive services with this aircraft, or soon will, such as Blackall, Barcaldine, Blackwater, Cloncurry, Longreach, Horn Island and Weipa in Queensland, Port Lincoln in South Australia and Tamworth and Wagga Wagga in New South Wales. There are also operators servicing airports with lighter aircraft that may be considering upgrading to heavier aircraft in the future.
The cost of new terminal buildings, secure storage, baggage handling, and
security staff will run into millions and for some airports, this cost must be a carried for just for a couple of services a week. The Minister just scoffs at these concerns.
Plainly the $32 million will not be enough. The screening trigger is to apply from 1 July 2012, but these funds will be provided from Financial Year 2010-11 to Financial Year 2013-14 - two years after the start up time.
I have heard from credible industry sources that the real cost of this security screening policy will be closer to $100 million. Plainly, if the cost was to be simply passed on to passenger charges, many already marginal routes would close. The Government has also refused to provide us with the security justification for this policy. If there has been a change to our security environment, the Government will not tell us what it is and apparently that threat must be dealt with next year.
So much for the White Paper.
The Coalition recognises that aviation in Australia requires the support of a highly skilled workforce. The Coalition flagged during the recent election campaign that it is prepared to make commercial pilot training more accessible. The Coalition pledged that it would work towards ensuring that those undertaking a Commercial Pilots Licence qualification delivered through an approved training organisation will attract Federal student loan assistance.
I have heard, in response to this announcement, that perhaps it does not go far enough - that it should apply to those undertaking an Australian Air Transport Pilot Licence that qualifies pilots to command high capacity multi-crew aeroplanes engaged in passenger carrying operations. All policies have costs and I would need the resources of Government to really look hard at the financial implication of this policy. However, I am happy to take this request on board and look at it should we win office.
I also appreciate that there is issue of concern to your industry. That is your relationship with CASA.
Let me say something controversial. I think, by and large, that CASA does a good job. It is a regulator and so is not loved. I think John McCormick is genuine in trying to restructure CASA to better work with industry.
I know that things can always improve. In particular, I acknowledge that CASA's long unfinished Regulatory Reform Program is an irritant in its relationship with industry. The suite of regulations that impact upon licencing, aircraft maintenance and flight operations standards are not yet redrafted and for the 37,000 pilots and 13,000 owners of aircraft with whom CASA has a regulatory relationship - this is a matter of frustration.
The Coalition will be watching very carefully to see if the Government meets the pledge it made in the White Paper that these regulations will be finished by the end of 2010. Should the Coalition win Government it will be our absolute priority to finish this work.
We will also ensure that the amount raised by the recent increase in aviation fuel excise from 2.854 cents per litre to 3.556 that took place from1 July 2010 is spent in the way promised. That is, the extra $89.9 million this increase will raise over the next four years will actually go to funding 97 permanent positions for safety specialists, safety analysts, and air worthiness inspectors. CASA is now very well resourced and its funding will only grow as the industry rebounds in the years ahead.
CASA is now without excuse. In Opposition the Coalition will be holding CASA and the Government to account over this promise. In Government, we will be asking CASA to report regularly as to its use of this extra funding and expecting matters such as the Regulatory Reform Program to be finished quickly. We will expect that its liaison with industry to be thorough and credible.
As I conclude, I want to emphasise to you how important the Coalition believes it is that your industry is properly acknowledged for its contribution to our nation. Regional aviation is playing a vital role in the growth and development of our nation. You provide the essential communication and transport services which link our regions to the capital cities and the world. It is the regions that are producing our nation's export wealth and economic prosperity and this role is not well appreciated or understood in our cities.
The Rudd-Gillard Government was the most city-centric in our nation's history and the people of regional Australia rejected Labor at the recent election, with almost every regional electorate recording significant swings against them. The people of regional Australia and those who service them are demanding a fair share. They want more of the wealth earned in our regions returned to the regions.
I am not sure the incoming Labor Government has heard this message. The Prime Minister now has now chosen her new ministry and it is still city-centric. The Regional Development Minister no longer lives in central Sydney; he now comes from central Melbourne. The Agriculture Minister no longer comes from central Sydney, he now lives in Brisbane. There is now though, one minister who does not live in a capital city, although he only recently moved to Newcastle which hardly gives him rural or regional credentials.
Despite Labor's recent feigned interest in regional issues, the Coalition will still need the support of organisations like yours to ensure that the concerns of people who live outside the capital cities receive greater focus in the current Parliament. We are keen to work with you to achieve better outcomes for those who work and live in regional Australia.
I am delighted to declare your conference open.
