Steven Ciobo (Moncrieff, Liberal Party) Share this | Link to this | Hansard source

I am pleased to speak in the debate on the Civil Aviation Legislation Amendment (Mutual Recognition with New Zealand) Bill 2005. This is an important bill for both Australia and New Zealand because it puts into effect and continues to make arrangements for the operation of what is effectively an open skies policy between Australia and New Zealand. At its core, the relationship between our two countries is best described as being very strong. We share in many respects a common history but, more importantly, I believe Australia and New Zealand share a common destination. For our two peoples, this relationship, with respect to the bill that is currently before the chamber, as with so many other areas of regulation and legislation between our two countries, sees our two countries moving continually towards a greater level of interoperability and mutual recognition.

For me, representing the seat of Moncrieff, based in Australia’s sixth largest city, the Gold Coast, this bill plays an important role in ensuring that the most important industry in my city—namely, tourism—is provided with the maximum opportunity to continue to flourish and continue to grow into the future. In particular, when one considers that perhaps our single largest inbound tourism market for the Gold Coast comes from New Zealand, it is very clear that governments should take whatever measures that they can to ensure that we facilitate tourism as much as possible. The bill that is currently before the chamber does just that.

For an area such as the Gold Coast, there will be, as a result of the implementation of this bill—indeed, there have been results from the implementation of other bills previously—significant benefits both for my city and also for New Zealand. In particular, the Gold Coast airport has had over the years a number of inbound flights flying directly out of New Zealand ports such as Auckland, Wellington and Christchurch. Each of these ports has spawned flights which are flying New Zealand tourists directly from those cities to Gold Coast airport. I have been very pleased that inbound tourism numbers from New Zealand have been particularly strong. I predict that not only will we see an increase in the number of New Zealand tourists coming into the Gold Coast but also we will see, as a consequence of bills such as this, increased investment from New Zealand. A number of New Zealanders have taken opportunities to purchase property on the Gold Coast. A number of New Zealanders have taken opportunities to export back to New Zealand products and services available on the Gold Coast. Of course, people have particular skill sets that are utilised in both countries. This kind of growth in the friendship between our nations in terms of exports and imports between both countries flows from having fewer regulations and more commonality between our two countries.

In terms of the history and the basis of the policy commitment behind this bill, we need to ensure that this closer relationship does not come at the expense of public safety. We have a great tradition in this country of Australians knowing that our aviation standards are among the very best in the world. Indeed, it is this country’s proud boast that we have one of the safest airline policies and safest forms of recognition when it comes to aviation safety that exists throughout the world. Similarly, New Zealand has a proud track record, albeit one that is slightly different in terms of the actual mechanics of the legislative framework and regulations that apply to aviation standards. In this regard, though, it is very clear that both countries remain wholly committed to ensuring that our respective peoples are not at any time jeopardised when it comes to aviation standards.

The bill recognises that our two countries, although having some differences in terms of the civil aviation framework that is in place, in broad terms are operating in parallel. In broad terms, aviation standards that apply both in Australia and in New Zealand ensure that there is compliance with international standards when it comes to aviation safety.

In terms of the mechanics of this bill, which I will just touch on briefly, it effectively ensures that there is mutual recognition of air operator certificates between Australia and New Zealand. In essence, these are the certificates required in order to operate an airline. With respect to these bills, they have application to larger aircraft that hold in excess of 30 seats or have a tonnage greater than 15,000 kilos. So this bill before the chamber today ensures that we now have a commonality of interest—mutual recognition between Australia and New Zealand with respect to civil aviation for aircraft with more than 30 seats or 15,000 kilos. I encourage the continued development and operation of mutual recognition between these two countries not only with respect to aviation but also with respect to finance, banking, payment systems, professional accreditation and a whole host of comparative measures which would see our two economies continue to come closer together.

I will touch on what to me is at the very heart of this bill—that is, the fact that we need to ensure that we continue to provide choice to the Australian people, and to the New Zealand people, to encourage tourism between our two nations. This bill does just that, and I certainly commend this bill to the chamber. This bill paves the way for an area like the Gold Coast—which has as its biggest source market New Zealand tourists; and its highest level of direct foreign investment in real estate, for example, from New Zealand—to continue to develop those relationships. It generates export growth for Gold Coast small businesses in terms of tourism and education services, for example. I commend the bill to the chamber.

Martin Ferguson (Batman, Australian Labor Party, Shadow Minister for Primary Industries, Resources, Forestry and Tourism) Share this | Link to this | Hansard source

I am grateful for the opportunity to continue the Labor Party’s contribution to this important debate on the Civil Aviation Legislation Amendment (Mutual Recognition with New Zealand) Bill 2005 [2006]. As has been acknowledged by all speakers, it is an important debate. It is important because the bill has the potential to lead to an overall reduction—and I think people should appreciate this—in safety standards across the Australian aviation industry. It may even result in the shift of some aviation operations across the Tasman and the loss of Australian jobs and economic opportunity.

The bill provides for mutual recognition of certain air operator certificates issued by the Australian Civil Aviation Safety Authority and the Civil Aviation Authority in New Zealand. It is—and I am surprised the government did not take this on board—widely opposed by industry, including the Australian and International Pilots Association; the Australian Federation of Air Pilots; the Flight Attendants Association, international and domestic divisions; and the Australian Licenced Aircraft Engineers Association. These organisations, which are intimately involved in aviation in Australia, are rightly concerned about security and safety, which the Australian public have expressed concerns about, yet the government has dismissed those concerns in pursuing this bill.

I say that because the government is flying in the face of industry opposition. The fact is that these organisations hold serious fears that the bill will potentially have a major impact on safety standards and they predict a loss of Australian aviation operations to New Zealand. The problem is that this bill has been on the government’s agenda since it signed the Air Services Agreement on 8 August 2002. It is simple in its mind: we cuddled up to New Zealand; therefore we have got to deliver the outcome of that meeting without any consideration of safety, the fight against terrorism and the needs of the Australian travelling public. The Labor Party, through our caucus, have now twice considered the government’s attempt to provide for mutual recognition of the air operators certificates by the New Zealand and Australian aviation authorities.

The 2003 bill lapsed in the absence of Senate support, and I suppose you have to have regard for why it lacked support in the Senate back in 2003. It failed because the government had refused to undertake any action to justify the bill or assess likely safety outcomes. Just imagine that: aviation is about the safety of the travelling public, and back in 2003, despite concerns in the Senate, the government refused to take any action to justify this bill and have a look at safety implications. That goes to the failure of the government to make a comparative assessment of safety operating systems in Australia and New Zealand and to undertake a regulatory analysis of the systems of the two trans-Tasman nations, which is the fundamental reason why the opposition opposes the bill.

I wonder whether the government would adopt a similar view if it were related to quarantine and the potential impact on the agricultural industry. I wonder, for example, where Paul Neville, the chair of one of the government’s committees, would stand. I noticed him supporting this bill. I wonder what his view would be, given his rural seat, if all of a sudden, because New Zealand demanded it, we dropped our strict rules on quarantine and the entry of some New Zealand products into Australia. The government would be up in arms. When it comes to the safety of the travelling public and the fight against terrorism, all of a sudden we as a nation have to roll over to potentially lower standards on aviation safety because New Zealand demands it. I am exceptionally worried about where the safety of the travelling public in the future might end up.

The government seems intent on just going ahead, blinded by the drive of liberalising air services arrangements as part of its so-called wider economic reforms in the transport sector. If we actually wanted to do something about economic reform in the transport sector then we would be concerned about issues such as how to improve our national rail system, how to overcome some of the transport blockages with respect to port access and how to overcome our shortage of labour in the trucking industry at the moment, as we cannot attract and keep people. They are the types of issues which go to fundamental economic reform in the transport sector in Australia, not this endeavour to reduce safety standards.

It is particularly baffling that the government would pursue this line of action when what is at risk is a diminishing of Australia’s rigorous aviation safety standards and the loss of Australian jobs and operations. This is a huge stake that the government surely understands, so I ask: why does it continue to fail to examine these issues? I think it is important to acknowledge concerns about safety implications and for us to commit to understanding an assessment of the possible safety implications of this bill. I therefore refer to the fact that in August 2006 the Department of Transport and Regional Services released International fatality rates: a comparison of Australian civil aviation fatality rates with international data. The report noted that Australia recorded fatality rates similar to or lower than the corresponding rates of the other countries examined. Those countries were examined against North America and the United Kingdom as the world’s best practice benchmark for aviation safety. The findings demonstrate two important points: firstly, Australia overall has a good safety record according to world’s best practice; and, secondly, the general aviation fatal accident rate for Australia was lower than the accident rate recorded for New Zealand, the country that the government is seeking mutual recognition with, which is the thrust of this debate, and it showed a downward trend in Australia.

The report by the department goes to the heart of the opposition’s concerns about this bill—the safety of Australians involved in aviation travel, which is more important than ever, given the fight against terrorism. It raises issues of Australian and New Zealand aviation safety standards, which are not directly comparable. People have to appreciate this: they are not directly comparable, and yet the bill’s objective is to permit the holder of an air operator certificate issued in New Zealand for the operation of an aircraft of more than 30 seats or 15,000 kilograms to conduct operations in Australia without having an Australian issued air operator certificate.

One example of what this means for air safety for air travellers is a lowered cabin crew ratio on New Zealand carriers, where the law stipulates a minimum of one crew member per 50 seats compared to Australia’s ration of one crew member for 39 passengers, not seats. That is a pretty distinct safety issue. In that context, I refer to an incident on board a Qantas aircraft from Melbourne to Launceston only a matter of a couple of years ago. The cabin crew were able to disarm a person who unfortunately had some medical concerns. That reinforces the need to have an adequate number of crew on board as cabin attendants. It is about time people understood that flight attendants are not engaged to serve tea and coffee. More importantly, flight attendants are there for security purposes. The last thing that we should be doing is lowering the number of flight attendants on Australian aircraft.

This is a debate about aviation safety standards; this is a not a simple debate about us having to cuddle up to New Zealand on mutual recognition issues. I am a very strong supporter of CER, but this goes to the heart of the desire that we have always had as a nation to put in place the safest possible aviation standards in the world. We have a proud international record. Many nations aspire to achieve Australia’s achievements on aviation safety. Given the fight against terrorism and as reflected by the Launceston incident, these standards are more important than ever. Finally, there is an acceptance in the aviation industry that flight attendants perform a variety of functions, and perhaps their most important function is that of being air marshals. There have been air marshals put in place by government for terrorism purposes, but they are only in some planes. Flight attendants are on all planes, so we have got to make sure that there are adequate numbers to protect passengers and to protect the Australian community.

I am amazed that, given these considerations, the government has failed to acknowledge this safety concern—and this despite the issue of the disparate safety standards between Australia and New Zealand being raised during the inquiry into this bill by the Senate Rural and Regional Affairs and Transport Legislation Committee in 2003. During this inquiry, several submissions to the committee highlighted safety standard concerns. A submission from the Australian and International Pilots Association said, ‘New Zealand’s aviation safety system may well comply with the standards required by the International Civil Aviation Organisation and still offer a lesser standard of aviation safety than Australia’s system.’ That is pretty telling because there are base standards—minimum standards—that are acceptable, but then there is what we do as a nation, for more abundant caution, which is to require more rigorous standards. Simply because there is a base standard does not mean it is acceptable. The more rigorous standards accepted by both sides of parliament for decades are the standards that we should maintain as a nation. That is the point made in the submission made by the Australian and International Pilots Association.

While pilot error in the industry is said to be in decline, now is not the time for the government to be taking its eye off the ball where air safety is concerned. Factors of fatigue, weather, congestion and automated systems have complicated safety and highlighted the ever-important need to make aviation as safe as possible. A good safety record, I suggest to the House, is a judgement of past performance, but it does not guarantee the future, and without appropriate investigations of the likely safety and economic outcomes Australia cannot consider a bill that is potentially a great threat to our consistently high track record on safety.

I also note that the Senate Rural and Regional Affairs and Transport Legislation Committee did not just hear concerns regarding safety standards but also took evidence that some airlines may manipulate the new rules by servicing Australian domestic routes while operating under New Zealand regulations and lower cost burdens. How many Australian jobs does the government predict might migrate over the Tasman to New Zealand if it costs less for a carrier to operate in New Zealand than in Australia? Why can’t the government answer such a straightforward question that currently burdens the minds of many Australian aviation workers? In a submission to the inquiry, for example, Virgin Blue suggested that mutual recognition had the potential to create a race between carriers towards the cheapest regulatory option. Is that what the government wants—something similar to its industrial relations system, with an aviation industry that does not rank safety and Australian jobs as the highest priority? That is the conclusion I come to.

It is also likely that, due to differing operational requirements, mutual recognition between Australia and New Zealand will have economic implications for aircraft operators and also consequent flow-on effects for their employees and workers. There is clearly a potential disparity between the salaries of Australian and New Zealand pilots who operate the same type of aircraft but under different air operator certificates. This could have an impact on industrial relations and ultimately the stability of the sector’s workforce. The question is whether or not Australia needs this, in light of the radical industrial relations laws that the Howard government pushed through earlier this year.

To say that the government has not considered the economic cost of this bill is simply a lie. It is also certain that the implementation of mutual recognition will carry no direct financial cost to the Australian government; yet I believe there will be a cost to the Australian people in terms of safety standards—which is what drives the opposition in this debate—and the potential for jobs to be taken offshore due to the commercial advantage provided by New Zealand air operator certificates because of lower safety standards.

The question to be answered by the member for Fisher, who is intent on making a contribution to this bill, is: is it appropriate to provide this advantage to overseas operators when there is a cost to Australia? Qantas, for example, already operates in New Zealand via its wholly-owned subsidiary, Jetconnect. Since October 2002, Jetconnect has been operating domestic services in New Zealand with aircraft that are registered in New Zealand and flown by pilots holding New Zealand air operator certificates. While we accept that an Australian air operator certificate is equal to that of an air operator certificate issued in New Zealand, the standards are inconsistent.

This legislation was introduced in June 2004 and now, 16 months on, the government has still taken no action at all—and this goes to the crux of this debate—to properly assess its impacts. The opposition, therefore, cannot accept the introduction of a new aviation regulatory regime in the absence of any assessment of likely safety and economic outcomes. Why wouldn’t a government, in assessing the impact of a bill which goes to aviation safety, commission an independent study of these fundamental issues? I have come to the conclusion that it is because the bill is not about aviation safety; it is about the government’s industrial relations agenda.

This is foolhardy, and I only hope that it does not go wrong. If something were to go wrong, for example, because of a reduced number of flight attendants, which could endanger aviation safety in Australia, then the responsibility for that act will rest on the shoulders of the Howard government. That is a very serious worry, as the Launceston accident proved. In that instance there was a person on board who had mental health problems and had to be overcome by flight attendants. There was an adequate number of flight attendants on that plane under Australian aviation standards. That incident showed that we have to use abundant caution in the standards that we have in Australia.

This bill potentially destroys those standards. It is the first step in an endeavour by some in the aviation industry, with the support of the Australian government, to create a bridgehead which will lead to a further weakening of Australian standards with respect to safety and the number of flight attendants on board aircraft to protect the Australian travelling public.

In conclusion, I can only say: we will be watching. If this goes wrong, we are going to remind the government of its foolhardy decision. The point of view of the opposition is: when it comes to safety, be cautious and err on the side of having more rigorous standards—because I fear the consequences of liberalisation without proper consideration of the needs of the Australian public and our nation’s best interests.

Peter Slipper (Fisher, Liberal Party) Share this | Link to this | Hansard source

It was interesting to note the remarks made by the honourable member opposite in his speech. He is totally critical of the New Zealand regulatory regime and suggests that New Zealand has, in some way, an unsafe air system. He ought to appreciate that the government in New Zealand which presides over this air system that he deems to be unsafe is a Labour government.

I want to address the matter made by the honourable member with respect to the cost to Australia of the provisions of the Civil Aviation Legislation Amendment (Mutual Recognition with New Zealand) Bill 2005 [2006]. Obviously one always likes to see as many Australian jobs created as possible. I have to say that since the Howard government was elected in 1996 it has had an unprecedented record on the creation of jobs. In fact, people now have a very much greater opportunity to get one foot on the employment ladder as a result of the positive economic reforms of this government and as a result of the way in which it has created a situation where business is prepared to invest and grow.

Of course, the best way to create jobs is to have a vibrant economy. Most countries throughout the world hold this government and this government’s economic performance up as a paragon, as something worthy of being followed. So it is unfortunate that the member for Batman tends to overlook this government’s sterling performance with respect to job creation and tries to focus on the possibility that some Australian jobs in the civil aviation market may not continue to exist. I do not think he provided any firm evidence that the jobs in Australia were going to reduce in number. However, I take the view that this legislation is a small step forward in the harmonisation of laws between Australia and New Zealand.

I am one of those who agrees with the member for Moncrieff. I think he said that Australia and New Zealand have a common destination. My own view is that the common destination ought to be that Australia and New Zealand achieve their ultimate destiny, which is to become one nation. Were Australia and New Zealand to complete the processes that were commenced with the colonial conferences prior to the commencement of the 20th century then there would be a much greater level of harmonisation, and we would be not only having more harmonisation in the area of civil aviation but also reducing costs to business, creating a situation where bureaucracy was less and removing some of the differences which really have very little justification for existing.

I know there has been a substantial degree of harmonisation between Australia and New Zealand, but I think it really is important that we have, in this area of civil aviation, the harmonisation that is being brought about by the Civil Aviation Legislation Amendment (Mutual Recognition with New Zealand) Bill 2005 [2006]. For the record, I personally support a single currency between Australia and New Zealand. If it is possible for the very different countries of Europe to implement the euro given their histories, why is it not possible for Australia and New Zealand, with two currencies which are not really worth much different from each other, to have the benefits of a combined currency?

What is the logic in New Zealand of having extraordinarily expensive mobile phone rates? Telstra used to provide a mobile phone service in East Timor prior to East Timor’s independence, and that was able to be managed. I personally believe there should be a joint telecommunications market and there should be a joint banking market. In fact, I believe that Australia and New Zealand have a common destiny.

That is why the contribution made by the member for Batman—and I know where he is coming from ideologically—does not have a great deal of logic, bearing in mind that increasingly Australia and New Zealand will become integrated. Small steps, such as those proposed by the Civil Aviation Legislation Amendment (Mutual Recognition with New Zealand) Bill 2005 [2006], ought to be supported and encouraged.

Highlighted by a healthy rivalry in all things, from sport through to business, the people of the six states of continental Australia and New Zealand share a great relationship. This trans-Tasman competitiveness drives and pushes citizens on both sides of the Tasman to be as good as they can be, each trying to outdo the other, but in the process rising to become better, more improved individuals. Of course, the combination of those efforts on both sides of the Tasman means that Australasia as an entity becomes more effective, more competitive and more world-class. There will always be differences, such as on the rugby union field. Citizens from both our nations also share a great love of travel.

The member for Moncrieff referred to New Zealanders visiting the Gold Coast and to people from the Gold Coast visiting New Zealand. I have to say that in my electorate of Fisher on the Sunshine Coast I suspect I have the biggest New Zealand constituency in the world other than a constituency based in the islands of New Zealand. There would be more resident New Zealanders in the electorate of Fisher than probably anywhere else other than in a New Zealand electorate. I know that they share our values, I know that they pay their taxes and I know that they are very worthwhile citizens. I can understand why those citizens from New Zealand would choose to live on the Sunshine Coast whereas citizens from New Zealand choose only to visit the Gold Coast.

Jill Hall (Shortland, Australian Labor Party) Share this | Link to this | Hansard source

Mr Deputy Speaker, I am really reluctant to do this, but I would like to raise a point of order on the member for Fisher because, as much as I try to come to terms with what he is saying, I really do not understand how the New Zealand population on the Gold Coast and the conditions that exist on the Sunshine Coast really relate to this piece of legislation.

Bob McMullan (Fraser, Australian Labor Party) Share this | Link to this | Hansard source

In response to the point of order: while I did think I might have to give the member for Moncrieff a right of reply, I did not otherwise think that he was straying too widely, as long as he comes back to the bill relatively quickly.

Peter Slipper (Fisher, Liberal Party) Share this | Link to this | Hansard source

Thank you, Mr Deputy Speaker. I was surprised that the member opposite chose to rise to her feet to defend the Gold Coast. I would have thought the Hunter might have been more in her area. But I was only using the example of the relationship between the Sunshine Coast and New Zealand and the Gold Coast and New Zealand to indicate the huge trans-Tasman travel—

Geoff Prosser (Forrest, Liberal Party) Share this | Link to this | Hansard source

Absolutely.

Peter Slipper (Fisher, Liberal Party) Share this | Link to this | Hansard source

I thank the member for Forrest. That trans-Tasman travel of course will be greatly impacted upon by the Civil Aviation Legislation Amendment (Mutual Recognition with New Zealand) Bill 2005. The travel and tourism website Asmal.com has documented the trends in air travel between Australia and New Zealand in the June 2006 quarter. Figures on the website are quite interesting. They show that the number of Australians who travel to New Zealand increased by two per cent in that reporting period over the same period last year, while the number of New Zealanders coming to Australia increased by one per cent. While these are not huge increases, Australia and New Zealand remain very high on each other’s lists of top 10 favoured overseas destinations.

The member for Stirling has entered the chamber. The member for Stirling represents his Western Australian electorate very well, I might say, and he will continue to do so for many years. But it is a fact of life that it actually costs very much more money to travel to Western Australia from Queensland than it does to travel to New Zealand from Queensland. So the logic of having harmonised civil aviation safety arrangements between Western Australia and Queensland is as relevant as the need to have those harmonised arrangements with New Zealand.

The ties that we have today have their origins a long way back in our histories and it is important that the relationship between the two nations continues to be nurtured and supported. The Civil Aviation Legislation Amendment (Mutual Recognition with New Zealand) Bill 2005 builds on the relationship in a perhaps routine but important manner in the area of air travel. The bill will allow the recognition in Australia of air operator certificates issued by the New Zealand equivalent of the Civil Aviation Safety Authority, the Civil Aviation Authority of New Zealand. The air operator certificates, or AOCs, are the documents issued to aircraft operators or carriers that give authority for passenger charter or regular public transport operations. This bill provides for the amendment of the Civil Aviation Act 1988 to permit the recognition by both countries of AOCs related to the operation of aircraft with a mass greater than 15,000 kilograms or with more than 30 passenger seats.

Across the world, Australians and New Zealanders are recognised as having many similarities, including a commitment to air safety. I want to defend the air safety record of the New Zealand Labour government. I do not want to criticise it—the way the member for Batman did. I believe that the New Zealand authorities are as dedicated to air safety as the Australian authorities are. The mutual recognition, as is included in the title of this bill, refers to the recognition that each of our respective aviation laws is fundamental in delivering a safe operation of aircraft in our respective jurisdictions.

With so much travel between Australia and New Zealand, it is not difficult to see what the ongoing impact would be to continue having AOCs that are recognised by one country but not the other. The impact is increased costs for operators who are forced to meet the requirements of both CASA and CAANZ to permit their planes to operate commercially in both air spaces. This results in duplication and repetition in the areas of administration and financial outlays, for example. The bill removes that burden by recognising the AOCs issued by both of the aviation authorities and builds on the agreement between the two countries—the 1996 Australia-New Zealand single aviation market arrangements.

The bill does not create the amalgamation of the aviation authorities of New Zealand and Australia—and I think that it is unfortunate that the bill does not do that. We do have a number of joint amalgamated regulatory authorities on both sides of the Tasman, and I cannot, for the life of me, see the logic in not having that in the area of aviation. But this bill is a step forward. Hopefully, that complete amalgamation will ultimately occur.

Following the passage of this bill, Australian laws will still have to be obeyed by New Zealand carriers operating in our controlled air space, and the authorities will continue to have specific responsibilities for their own aircraft operations, including responsibility for safety audits and surveillance. The granting of operating permits and other safety oversights will remain the responsibility of the home authority. In addition, rules governing the manner and conduct of aircraft operations are also to be administered by the home authority.

Aviation authorities will still have the power to issue temporary stop notices to aircraft operating in Australia that hold AOCs with New Zealand privileges. As host to a New Zealand carrier, CASA can issue stop notices if the carrier is deemed to pose an aviation safety risk. The home safety regulator, CAANZ, will then take steps to take any necessary action.

This bill will encourage the greater ease of operations between airline operators in both Australia and New Zealand, and similar legislation in New Zealand recognising AOCs issued by the Australian authorities was introduced in early 2004. This bill is one of the first steps that will, in my view, ultimately result in umbrella recognition for the aviation requirements and regulations of both nations. My view, as I said before in this speech, is that there really ought to be one set of rules for operating on both sides of the Tasman. I am pleased to be able to commend the Civil Aviation Legislation Amendment (Mutual Recognition with New Zealand) Bill to the chamber.

Kim Wilkie (Swan, Australian Labor Party) Share this | Link to this | Hansard source

I rise to speak on the Civil Aviation Legislation Amendment (Mutual Recognition with New Zealand) Bill 2005 and to add my comments to those made by my colleagues in this House and in the other place. As has been made clear, the opposition opposes this bill. We oppose it because it will undermine Australian aviation safety standards. We oppose it because it will foster a reduction in cabin crew numbers on flights in Australia and it will lead to job losses.

The government, that lazy moribund lot opposite, will not even take the time to provide a proper assessment of the likely safety and economic outcomes. I pause for a second to consider what it will be like on long flights with the member for Forrest when there is an inadequate number of flight crew to look after the needs of the member on those sorts of trips. What the government should be doing is protecting Australian jobs and protecting the Australian travelling public. There are 500,000 people in regional Western Australia who take flights with unchecked baggage. Across the country, millions of passengers a year are flying on planes with unchecked baggage, and these flights are heading towards major cities.

Let me make it clear from the start that I hold serious reservations about CASA’s ability to adequately patrol Australia’s own aviation industry, let alone letting it regulate aircraft from another country. I have evidence that CASA has previously misled a Senate estimates committee, which places the integrity of the organisation in doubt, and I will refer more to this later.

This bill was considered by the Senate Rural and Regional Affairs and Transport Legislation Committee. Indeed, many submissions to that committee expressed grave concerns about the measures in the bill. It provides, in a nutshell, for mutual recognition of certain air operator certificates, AOCs, issued by Australia’s Civil Aviation Safety Authority, CASA, and the Civil Aviation Authority of New Zealand, CAANZ. The provisions in this bill mean that a holder of an AOC for operation of an aircraft of more than 30 seats or 15,000 kilograms issued in New Zealand will be able to conduct operations in Australia without having to obtain an equivalent AOC issued in Australia. Given the mutuality of this approach, obviously the provisions will apply in reverse.

The Labor Party has called on the government to justify the changes in this bill and to assess the impact on safety of the bill’s provisions. This is hardly unreasonable. As we know, the Labor and Democrat senators on the committee issued a dissenting report. They stated that they did not accept the government’s argument for change, due to a lack of research behind the main premise of comparable safety standards between Australia and New Zealand and the cost-benefit analysis of changes wrought by the bill. We on this side do not accept that the government has presented any evidence to support the premise that Australia and New Zealand present comparable safety outcomes. Indeed, no comparative study of the regulations and practices pertaining to Australia and New Zealand has been undertaken. Rather, the Australian government has relied on the fact that both Australia and New Zealand have met international audit conditions. However, research showing a clear correlation between higher crew ratios and more effective—that is, safer—aircraft evacuations has not been taken into account.

The safety review that the committee recommended should have been undertaken. As the dissenting report states:

It defies logic to undertake this basic research after the change has been made.

The government have told the opposition that our concerns are unfounded and that the provisions in this bill will not reduce safety standards. But they have not provided to the parliament any evidence to justify their position. Their position is based purely on assertion, not fact. The Labor Party have called on the government to undertake the necessary work to provide the evidence to the parliament, but our calls have been ignored. If the government are so confident that it is right then why not prove it to us? Again, that is not an unreasonable question. But, no. In typically arrogant and heavy-handed fashion, the minister will not direct his department to do the necessary work. It is another shameful episode in the way in which this lazy government handles aviation policy in this country.

I have raised these issues with regard to CASA before in this House. A constituent of mine, Mr Clark Butson, who owns and runs an aviation company called Polar Aviation, has been pursued mercilessly by CASA. In fact, when you consider the chronology of events in the Clark Butson-CASA saga, you would be forgiven for thinking that these events took place in Salem, Massachusetts, as they are redolent of a witch-hunt. I will put a few salient facts before the House.

The long-running dispute appears to have its genesis in May 2004. The result of this audit was the issuing of 14 requests for corrective action, or RCAs. Polar Aviation responded to these RCAs by the end of June 2004. On 9 July 2004 CASA rejected these responses to the RCAs, which resulted in a show cause notice being presented. In August, CASA refused a reasonable request for an extension of time for Polar Aviation to deal with the show cause notice. However, two weeks later CASA changed its mind and agreed to an extension. The maladministration shown by CASA in the first part of this saga indicates to me that there is something seriously wrong with the culture of CASA. This goes to the core of Labor’s opposition to this bill.

By the end of September, Polar Aviation had managed to respond to all but three of the RCAs. I remind the House that this is a small business and an enormous amount of work was undertaken to achieve this result. A meeting convened by CASA was called for 18 October 2004. It was thought that this meeting would sort out all the difficulties. In fact, that was the feeling that Polar Aviation had after 4½ hours. A further audit by CASA in November 2004 occurred, and on 18 January 2005 CASA cancelled Polar Aviation’s air operator’s certificate—the AOCs which we are talking about today—and the chief pilot’s and chief flying instructor’s accreditation. However, in keeping with the dual personality demonstrated by CASA, on 20 January CASA changed its mind and decided to renew the AOC, provided a new chief pilot and chief flying instructor were appointed.

When you look at how this occurred you could say, with respect to the way CASA reacted, ‘Yeah, they seem to have done the right thing; and, fair enough, when it went to court the operator agreed to pursue this path of pulling out of being the chief pilot,’ but when you delve further, you find that really he was blackmailed into it by CASA and it was absolutely outrageous for them then to claim that they actually had an agreement for this undertaking.

Going back to the story: as requested on 29 January, Polar Aviation complied and appointed a new chief pilot and chief flying instructor. The chief pilot and instructor, Clark Butson, has probably more flying and instructing hours than anyone else in Western Australia. He has an impeccable safety record. So for this action to occur in itself is outrageous.

Yet again, CASA decided to shift the goalposts and then demanded that Polar Aviation withdraw the AAT action and agree to some extremely onerous and enforceable voluntary undertakings. Let us put it into perspective here. What they have done is to say: ‘Look, we know that you’ve been unhappy with the fact that we’re demanding you do these things and you’ve actually taken up an Administrative Appeals Tribunal hearing to look at some of the ways that we’ve been dealing with you. But I’ll tell you what: if you withdraw the action, we’ll back off.’ To me, it is out and out blackmail by a government department over a small business operator, and I find it absolutely outrageous.

Polar Aviation objected to this, as they should. So, on 1 February 2005, a counter-offer was made by CASA, now offering general undertakings. On 2 February, even this was changed, with CASA refusing to renew the AOC. Within the space of about two weeks, we have had various CASA positions. Again, on 11 February, after action in the Administrative Appeals Tribunal, CASA was required by the court to issue an AOC pending the full hearing of the case.

The whole thing smacks of a Monty Python out-take and would probably be amusing if it were not for the fact that CASA is charged with administering air safety. The AAT hearing held in August resulted in CASA being required to issue an AOC and ordered CASA to use its best endeavours to assist Polar Aviation. You would think that this would be the end of the matter, but no; the saga continues, with CASA appealing to the Federal Court and losing. Imagine the cost to a small business operator of having to go to the Federal Court and defend itself against a federal organisation with unlimited money. They know they have got unlimited money and they think that they can drive these poor little guys out of business by continuing to go to court and making them spend enormous amounts of money defending themselves. Again, this is outrageous. CASA’s recalcitrance and animosity towards Polar Aviation continues to this day, with the most recent AAT hearing in March this year resulting in conditions placed on Polar Aviation being varied, against CASA’s wishes.

I would contrast the action of CASA in relation to Polar Aviation, a company that has had no serious incidents or injuries in its nearly 25 years of operation, to that of CASA’s treatment of Transair. Transair, of course, was the company that was involved in the tragic accident and loss of 15 lives at Lockhart River last year. In May this year, after nearly 12 months, CASA moved to put in place, for a mere six months, an enforceable voluntary undertaking dealing with what appears to be systemic problems that should have been obvious for a number of years.

Labor supports a safe aviation industry and there is no place for petty vendettas or incompetence by the regulator. The facts that I have outlined prove that CASA has acted inappropriately and in a spiteful and vindictive manner towards my constituent. These actions by CASA have ramifications for the provision of aviation services to regional Australia. I would have thought that the minister, given his background, and his department might have had a little empathy with the needs of regional Australia. After all, they are both ostensibly responsible for regional Australia. But no; they allowed CASA to pursue Mr Butson with no grounds, and in doing so they have jeopardised the provision of aviation services to the Port Hedland area.

Around the traps of the aviation world it is well known that the government has had its own issues with CASA. CASA has become a power unto itself and effectively gives the Department of Transport and Regional Services the one-fingered salute when the department tries to impose policies on it. It has been widely speculated that in government circles patience with CASA is wearing a little thin and that there has even been mention of returning CASA’s functions to the department. There were good reasons for the creation of CASA in its current form but unfortunately CASA’s own behaviour is making it entirely possible that the previous structure will be reintroduced. CASA’s autonomy, far from making aviation safety stronger in this country, is actually threatening the integrity of aviation operations’ efficiency, as the saga of Mr Butson demonstrates.

As I have said before, my reading of the tea leaves leads me to the conclusion that what we have here is a personality dispute. CASA do not like this particular company and they are trying to drive them out of business, no matter what. For a government or semigovernment authority to deal with things in this way, I find absolutely outrageous.  It needs to stop. Government authorities must be above reproach and they must be above trying these sorts of dirty, disgusting little tactics against the little guy who has no way of actually defending himself other than in court and when his money runs out he is finished. When you deal with these sorts of situations and government departments treating people like this, it is just outrageous.

I call on the government to review CASA’s treatment of Mr Butson. Although the Minister for Transport and Regional Services has expressed good intentions in the past through his apparent willingness to investigate these matters, on this issue the minister has been fobbed off by CASA. The minister should not allow himself to be fobbed off again and he should insist on answers from CASA about how they have behaved.

I mentioned earlier about the recent Senate estimates committee hearing where CASA presented evidence. CASA’s evidence was, to some degree, accurate but when you look further they were providing minimalist answers to complex questions and, in fact, they were misleading the Senate. I have a document that demonstrates that, which will be going to people in the Senate next time CASA appears before them so that CASA can answer some of these questions. I also call on the Minister for Transport and Regional Services to supply members of this House with the hard evidence we need to assure us that, should this particular bill be passed, aviation security and safety will be in no way reduced. Unless and until such evidence is supplied, we will have no alternative but to oppose this bill.

Michael Keenan (Stirling, Liberal Party) Share this | Link to this | Hansard source

The Civil Aviation Legislation Amendment (Mutual Recognition with New Zealand) Bill 2005 seeks to amend the Civil Aviation Act 1988 to enable the mutual recognition of aviation related safety certification between Australia and New Zealand in relation to large aircraft. It is a very sensible and rational bill dealing with an industry that operates internationally so far outside the parameters of sensible economics that it insults common sense. After listening to the member for Swan, I am quite disbelieving that the ALP would oppose even these limited measures to improve industry efficiency. It is a sad indication that they have now adopted an ‘oppose everything’ mentality. When the government comes up with a sensible bill like this, the opposition feel that they have to oppose it regardless of the obvious economic benefits and the obvious benefits that it will have to passengers travelling across the Tasman.

I find it extraordinary that an opposition that appears to want to reclaim some economic credibility would take this position on this particular bill. I note that the member for Prospect is in the House. I understand that he is one of the members charged with improving the ALP’s economic credibility, yet he sits here whilst his party takes what is such an obviously illogical view of a bill that seeks to provide some very sensible efficiencies for airlines that cross the Tasman.

Sadly, almost every nation clings to what is a very destructive notion of a national flag carrier at the expense of their own citizens’ interests. The result of this for people travelling on international airlines is that they pay too much for airfares and they suffer bad service and less convenience—all in the name of the discredited notion of economic nationalism. It seems that, no matter how appallingly some airlines perform, it is virtually impossible for an airline to go out of business. The international aviation industry is ludicrously overregulated and lacks basic flexibility. If it were to be described in one simple word, it would be ‘corrupt’.

At a time when it seems that almost everyone would concede that competition is generally a good thing, the international aviation market is a monument to the folly of wrapping up particular industries in cotton wool and the poor results that this inevitably brings for consumers. In the United States alone the US federal government has spent a staggering $15 billion to keep bankrupt airlines flying. As a result of this, the service levels on American carriers are generally regarded as very poor. Why would an American carrier strive to improve its efficiency when the government has basically said: ‘Do not worry how you perform. Do not worry about improving services. We’re never going to let you go out of business anyway’?

In the European Union—a bastion of outdated economic thinking—the individual states continue to insist on the survival of airlines that are plainly unable to compete against their international peers. Nations long ago abandoned similar practices for other industries, yet in the airline industry this remains the norm. Sadly, Australia is not immune from these protective impulses, though we are far from being the worst offender. The government recently protected Qantas from all but the meagre competition that exists on the Pacific route from eastern Australia to the United States. This policy will result in higher airfares and less convenience for consumers, though I note that the ALP did not even take a position on that. Worse still, it will translate into Australia being a less attractive destination for American tourists, and this will cost tourism operators in my electorate of Stirling extra revenue. In the aviation industry, as in most other industries, it is competition that will drive continuing service improvements and efficiency. You only need to compare the service standards and pricing on routes which many operators service, such as the kangaroo route from Australia to the UK, with the standards and pricing on routes where only one airline operates, such as between Perth and South Africa. Where is the drive to improve when you have the market all to yourself?

I will leave some of those arguments for another day because the legislation that we have before the House is actually a welcome departure from this international norm as it cements the benefits of the open skies agreement that we have with New Zealand. I think anyone would agree that this agreement is an outstanding success and it provides a wonderful model for Australia to conclude further open skies agreements with other nations. As a result of this agreement, Qantas has been able to set up and run an airline in New Zealand, and the trans-Tasman route is extremely competitive. This provides enormous benefits to consumers, who can choose from a large number of service providers, from budget airlines right through to major international carriers such as Emirates. This is not an abstract view from some pointy headed economist. The benefits that flow from the open skies agreement are easy to see and very real for anyone who flies that route. You can actually fly between Australia and New Zealand one way for as little as $150. You can choose between five different service providers who link airports that have never before been linked, such as the Gold Coast and Dunedin. You can choose between services that operate throughout the day and fly when you want to fly. If only other markets in this industry could be half as helpful for consumers.

The bill deepens this successful agreement. It was first introduced into the parliament in June 2003 and, after being examined by the Senate Rural and Regional Affairs and Transport Legislation Committee, failed to pass before the expiration of the last parliament. The bill has been reintroduced into this parliament in a slightly amended form. The previous bill established a framework for the recognition of other safety certificates, such as maintenance, to be made via regulations without further legislative amendment. In response to the report from the Senate committee the ability for mutual recognition to be extended beyond AOCs, or air operator certificates, by regulation has been taken into account in this bill.

The committee report also recommended that, 12 months after the commencement of the mutual recognition of AOCs, the Civil Aviation Safety Authority, CASA, should conduct a comparative assessment of the safety records of airlines operating in Australia under both Australian and New Zealand AOCs. CASA will report the findings to the Commonwealth parliament within a further six months. I note that New Zealand has already implemented the minor amendments that it needs to its Civil Aviation Act to implement the measures that are contained in this bill. The bill is not a large one, but it does contain some very technical aspects, which I do not intend to go into today in anything but a general way.

Under the current circumstances, airlines must satisfy both Australian and New Zealand aviation requirements. These frameworks are set by the Civil Aviation Safety Authority in Australia under the Civil Aviation Act 1988 and by the Civil Aviation Authority of New Zealand in New Zealand under their Civil Aviation Act 1990. The problem with this situation is that it results in unnecessary duplication, complexity and added administrative and financial burdens on operators. This in turn deters operators from establishing air services in the other country. This is inconsistent with the intent of the current open skies air services agreement, which aims to promote competition amongst Australian and New Zealand operators, including on domestic routes.

The Civil Aviation Legislation Amendment (Mutual Recognition with New Zealand) Bill 2005 will allow CASA to recognise certain forms of safety certification issued by its New Zealand counterpart for the purposes of satisfying Australian safety requirements. The first form of safety certification to be mutually recognised will be the air operator certificates. In essence, an AOC certifies that an airline or aviation company is capable of providing flight services safely. There has been substantial activity by the Australian and New Zealand governments in recent years in relation to trans-Tasman aviation regulation. As I outlined earlier, this has provided very real and tangible benefits to anyone who flies this route.

The initial agreement, signed in 1996, is known as a single aviation market arrangement. In November 2000, an open skies air services agreement was initiated. That agreement lifted various restrictions on Australian and New Zealand airlines in operating some domestic, trans-Tasman and international flights. A memorandum of understanding signed at the time of the agreement foreshadowed the measures that are contained in this bill, and it is good that this MOU is now given effect in this bill. It is a bill that builds on the already successful arrangements that I have outlined.

Mutual recognition will enable airlines to operate to, from and within either country on the basis of their home certification. This will enable Australian and New Zealand airlines to integrate their fleets and to make these airlines more efficient and competitive—and, of course, that results in lower airfares and generally better conditions for consumers. I can only hope that our government and other much worse offenders in governments around the world heed the lessons for the benefit of their citizens that have resulted from this open skies agreement with New Zealand and take urgent measures to liberalise international aviation markets. I am sure that the member for Cook, who is apparently speaking after me, will endorse those comments.

I was not going to say too much more on this bill, but since the member for Cook is not in the chamber yet, I re-emphasise that I am astonished by the ALP’s opposition to these very sensible measures. It beggars belief that they believe that the Australian government would take measures that would somehow endanger passengers travelling on Australian airlines. That is clearly a ridiculous claim. Where is any evidence that the safety regime established by the New Zealand government is dangerous for Australian consumers? The reality is that this is an incredibly important bill that gives effect to the final part of what is a true open skies agreement that has been immensely beneficial for Australian and New Zealand consumers—or indeed anyone who flies that trans-Tasman route. I commend the bill wholeheartedly to the House.

Bruce Baird (Cook, Liberal Party) Share this | Link to this | Hansard source

It is my pleasure to rise to speak on the bill and to follow my colleague the member for Stirling. I thank him for his referral of the matter and for looking at it in fine detail. The Civil Aviation Legislation Amendment (Mutual Recognition with New Zealand) Bill 2005 is a technical bill and relates to the coordination with New Zealand of civil aviation requirements and mutual recognition of safety standards and certificates.

I chair the trade subcommittee of the Joint Standing Committee on Foreign Affairs, Defence and Trade in this House, and a few weeks ago we visited New Zealand as part of the 20-year anniversary—actually it has passed that; it is now some 23 years since the CER was established with New Zealand. Part of the reason why the CER was established was to ensure that we become a common market. That has happened to quite a large extent, but still there are obstacles which we continually need to overcome.

Part of our review was to look at what issues still remain on the agenda both within Australia and in New Zealand. Of course, we will be producing our report on that shortly. This bill is part of the coordination. In many ways, we operate like one country, but still with our independence. But with air safety, it is appropriate that we should coordinate wherever possible. Only air operator certificates for aircraft with more than 30 seats or 15,000 kilograms maximum take-off weight will be covered by mutual recognition at this stage.

The bill has been developed concurrently with New Zealand legislation, which was passed in the New Zealand parliament in March 2004, whereby their regulation and privileges will be compliant with ours and vice versa. It is a bill that has been designed to take out the duplication and complexity that currently exists for airline operators. It has been designed because current rules and regulations are not consistent with the intention of an open skies air services agreement to promote competition between Australian and New Zealand operators. It certainly will allow for a more flowing system of aircraft operation between the two countries.

The importance of it goes to the very core of the CER and the objectives of the CER to expand free trade by eliminating barriers to trade and promoting free trade competition. The fact is that New Zealand is a very important tourism destination for Australia. It is the No. 1 tourist destination for the Australian market. It is our source of tourists from New Zealand and vice versa—the No. 1 destination of their international visits is Australia, which is not surprising—albeit if you look at the spend of visitors from North America and Germany et cetera, they have a much greater to spend per capita. This is because many New Zealanders will come over to watch a footy match, which is fine, we love to have them. The figures represent them as No. 1 in terms of the number of people who visit this country. New Zealand currently represents 17 per cent of total visitors to Australia.

In 2005 close to 800,000 New Zealanders visited Australia, and it is forecast that by 2012 this figure will be around one million. Around a quarter of the visitors to New Zealand also visit Australia—which is not surprising, as many such visitors would travel through Australia to get to New Zealand—and approximately 10 per cent of visitors to Australia also visit New Zealand. Therefore, it is important, because of the tourism connections between our two countries, that we coordinate. The fact we have got Air New Zealand operating into Australia and flying internationally from Australian airports—

A division having been called in the House of Representatives—

As someone who shows a strong interest in tourism, Mr Deputy Speaker Scott, you would be interested in the way in which the tourism trade between Australia and New Zealand has developed so strongly. We are now in a position where New Zealand is our No. 1 source of tourists in terms of numbers. The same applies for New Zealand: Australians represent their No. 1 market for tourists. It is of note that approximately 10 per cent of those who travel to New Zealand also visit Australia. So there is that flow-on effect between the two countries. Their program ‘100 per cent New Zealand’ has worked very well for them. They attract a lot of international visitors, particularly American visitors, to the country.

As we have many visitors in common and the tourist numbers are similar, we should also be looking at coordinating arrangements in terms of civil aviation. That Air New Zealand flies freely within this country to international routes, particularly to the USA, and Qantas not only flies across to New Zealand to each of their major destinations—Auckland, Wellington and Christchurch—but also operates domestically and we now have Qantas’s subsidiary, Jetstar, operating through to the various ports in Australia, make this a very unique situation. It is a reflection of Australia’s CER agreement with New Zealand in coordinating our economic relations with the country.

There were some in New Zealand who were talking about a common currency and common border. Of course, it is going to take a lot more work before we get to that stage, but I think in the longer term we will see a very much changed environment and the two countries will have economic integration. Some would suggest that a mistake was made in 1901 when we formed the Commonwealth of Australia and that we should have included New Zealand at that time, but it was their decision not to join. We need to work on making sure that the coordination of our two economies is made as strong as possible.

The safety issues are obviously the predominant concern when you are dealing with aviation, and this is what this bill is about—ensuring that the safety standards that apply in one country apply equally in the other. It is obviously an issue which has taken on heightened importance since September 11, 2001. Our friends across the Tasman have very similar safety standards and produce very similar safety outcomes to ours in high-capacity airline operations. Mutual recognition terms are therefore going to allow for eligible aircraft operators to carry out aviation activity in Australia and New Zealand—whether international or domestic, passenger or cargo—based on the air operators certificate issued by their home country. The appropriate quote is:

… that an operator that is the holder of an AOC—

and associated certificates of permission—

issued in one country will not be required to hold an AOC—

or other certificate of permission—

in the second country in order to conduct air transport operations in that country.

This is a program that is going to be phased in. Initially, only eligible operators holding AOCs will be mutually recognised. Then consideration will be given to other certificates not already covered by other recognition arrangements. Currently the bill before us only makes allowances for the recognition of AOCs. However, there are provisions in the act to allow for the mutual recognition of more certificates in the future.

The issue of safety is, by way of an added guarantee, categorically put to rest by the fact that the host regulator has the power to issue a temporary stop notice to an aircraft operator who has permission issued by the other safety regulator if the operator is perceived to present a serious risk to aviation safety. This was brought to the fore with the collapse of Ansett, and there were some questions about the safety standards of Ansett at the time which undoubtedly led to its ultimate demise.

Operators will still have to comply with rules of the air and certain laws of the country in which they are operating. For example, New Zealand operators conducting services in Australia using an AOC supplied by the Civil Aviation Authority of New Zealand will still have to comply with Australian laws with respect to security, the environment, curfew and carrier’s liability, to name but a few. It is widely regarded that both Australia and New Zealand have world’s best practice airline operations with similar standards and consistencies. Of course, as two independent nations there are going to be discrepancies over the harmonisation of safety standards. However, while the overall safety of each system is recognised and achieved, the differences can be accepted.

This bill is going to enhance the cooperation between our two countries. It is going to promote aviation and competition in Australia and New Zealand by reducing the regulatory burden on operators. Instead of them having to meet both Australian and New Zealand requirements, one requirement will be all that is necessary. In fact, it is more than feasible to foresee that the announced changes, with the need to meet only one set of regulatory standards, will result in lower airline costs.

There has also been some fear that jobs are going to be affected. This in fact will not be the case. Australian cabin crew operate in a ratio of one staff member to 36 passengers, compared to one to 50 for New Zealand cabin crews. CASA stated that this Australian level of service is going to be forced to remain. New Zealand staffing ratios have support mechanisms and administration which are geared towards crew and customer staffing levels. On a lowest common denominator basis, Australian and New Zealand standards are comparable.

In conclusion: this bill is about accepting mutual standards for regulation. It is part of the CER, which harmonises our two economies and harmonises regulations between the two countries. It is going to assist in tourism, with the tourism industries on both sides of the Tasman being important. For both countries the other market is a significant source of tourism numbers.

When this was originally negotiated, in November 2000, it was suggested that the single aviation market of Australia and New Zealand was worth $6.8 billion. Mutual recognition will undoubtedly create significant opportunities and will add further to the relationship of our two countries. It is only through the joint understanding and commitment of Australia’s Civil Aviation Safety Authority and the Civil Aviation Authority of New Zealand that mutual recognition is feasible and possible. The force of the law given to CASA and CAANZ under the provisions of the act underpins this mutual recognition. I am happy to support this bill as further evidence that the CER is working and that we are making incremental progress. Following my visit to New Zealand with the trade committee recently, this highlights that we are working towards becoming in the longer term a single economic market. In the meantime, this assists at the level of coordination of the safety standards of the airline industries in both countries.

Tony Smith (Casey, Liberal Party) Share this | Link to this | Hansard source

I will sum up on behalf of the government at this point and make the final speech here in the Main Committee. The Civil Aviation Legislation Amendment (Mutual Recognition with New Zealand) Bill 2005, as the previous speakers have outlined, will enable mutual recognition of aviation security certification between Australia and New Zealand. It does a number of things. It removes unnecessary administrative burdens currently imposed on aviation operators wishing to operate in both Australia and New Zealand. When implemented, the mutual recognition arrangements will mean that operators of aircraft of more than 30 seats or 15,000 kilograms may apply for an air operators certificate, with Australia and New Zealand aviation privileges. This AOC will allow operators to fly in both countries without the need for individual certificates issued by each country. Mutual recognition therefore has the potential to deliver significant savings to the Australian aviation industry and passengers alike and may also result in greater choice for air travellers in both Australia and New Zealand.

Airlines are currently able to set up organisations and operate in both Australia and New Zealand, something that Australian airlines have already done. Virgin, Pacific Blue and Qantas New Zealand domestic operation JetConnect are just some examples. This bill will reduce the cost of establishing such operations by removing the need to duplicate effort, resourcing and certification processes. However, airlines will not be able to shop around for the regulator that suits them commercially, because this bill ensures that the aviation authority which can most effectively provide safety oversight will be the one to issue the AOC with ANZA privileges. This is a matter not simply of where aircraft are registered but of where operations are principally being undertaken. The decision about which authority issues the AOC and therefore regulates an airline under mutual recognition is based on a range of factors, including where the airline’s supervision of safety systems is principally undertaken, where the related resources are located, where training and supervision of employees is principally undertaken and where the control of operations will be situated.

Australian aviation safety will not be compromised. Nothing in the bill requires Australia to water down its safety standards or to harmonise them with those of New Zealand. An examination of regulations was conducted by CASA and CAANZ and it was found that, although different in some respects, the safety regulatory systems in place in Australia and New Zealand achieve comparable safety outcomes with respect to large passenger aircraft. The standards in both Australia and New Zealand meet and, indeed, in some areas exceed international requirements set by the ICAO, and this has been verified through publicly available audits. A recent report by the ATSB examining fatal accidents has found that Australia’s fatal accident and fatality rates were mostly similar to those of the other countries examined, including New Zealand. Safety outcomes, of course, are the result of a number of inputs. Regulatory oversight, while indeed an important factor, is not the sole determinant of safety results. The ATSB report notes that other relevant factors include weather, geography and air traffic density, to name a few.

While criticism of this bill has focused on cabin crew ratios, it should be noted that foreign airlines, including those from New Zealand, already operate within Australia under their own cabin crew ratios, which are different from those applied through Australian regulation. This has been an accepted international practice for a number of years. There is no evidence that this has had a negative impact on aviation safety in Australia. CASA’s current practice of conducting routine surveillance of foreign aircraft will continue to apply to airlines operating in Australia under ANZA privileges.

This bill has been thoroughly considered twice by the Senate Rural and Regional Affairs and Transport Legislation Committee. The government accepted recommendations made in the majority reports from that committee and has addressed them. The bill includes measures to ensure that aviation safety in Australia is maintained, and the government has committed to tabling an independent, comparative assessment of operator safety records within 18 months of the operation of the arrangements. The bill will be supported by appropriate regulations which will give effect not only to the provisions of the bill but also to the high-level operational arrangements currently being concluded with New Zealand. The government has undertaken that these will all be in place to allow commencement within six months of proclamation.

Despite claims to the contrary, aviation security will not be affected by mutual recognition of aviation safety certification. New Zealand airlines operating to, from or within Australia using a New Zealand AOC with ANZA privileges will still have to comply with Australian aviation security legislation and have an approved Australian aviation security program. As is presently the case for Australian domestic airlines, if a New Zealand airline were to operate domestic services within Australia, it would need to fully comply with Australia’s aviation security regime, including carrying air safety officers if they are assessed as falling within the risk based aviation security officer allocation process.

Importantly, while Australia’s high standards of aviation safety and security are maintained, the implementation of mutual recognition as set out in the bill will: open up increased market opportunity for Australian airlines; facilitate the use of both Australian and New Zealand registered aircraft in either country, improve aircraft utilisation and return on assets; and alleviate the administrative burden currently placed on Australian airlines wishing to operate in New Zealand. The passage of this bill will be of clear benefit to Australian airlines and their customers.

Question agreed to.

Bill read a second time.

Ordered that the bill be reported to the House without amendment.