[Peetwo]

ARFFS Inquiry Update 4/4/19: Dear Sterlo - L&Ks Harfwit.

1  Response by Airservices Australia to evidence provided to the inquiry, dated and received 2 April 2019.



1  Questions taken on notice at a public hearing in Melbourne, Victoria on 14 March 2019 by the Civil Aviation Safety Authority. Answer received 28 March 2019.

Hansard now out in two parts:    

1) Airservices Australia [09:14]

P2 comment: The CMATS/OneSKY trough fund stuff is mindboggling?

Example:

Senator PATRICK: What's the total budget for CMATS? I know there's a Defence component and an Airservices component?

Mr Logan : The budget for the contract for the Airservices component is about $665 million.

Senator PATRICK: Sorry, did you say that's combined?

Mr Logan : That's the Airservices component.

Senator PATRICK: But there's some agreement between Air Force and—

Mr Logan : There is. The total contract is about $1.2 billion.

Senator PATRICK: How much have you committed to that project by way of contract at this point in time?

Mr Logan : The complete amount.

Senator PATRICK: So the entire contract—it's just one contract?

Mr Logan : Yes, that's one contract.

Senator PATRICK: That implies that it's only internal costs that you've put in the $665 million. There must be other costs—consultants, internal operating costs?

Mr Logan : There's about $150 million worth of internal program costs on top of that.

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Senator PATRICK: The other thing I'm interested in, noting the history of this particular project, is rates for consultants. I'm wondering if there is anyone above $2½ thousand per day in terms of consultants?

Mr Logan : I don't have that level of detail with me. I'd need to take that on notice.

Senator PATRICK: The standard I'm working from is in the Legal Services Directions. There's a requirement for the minister, the Attorney, to sign off on rates for SCs, and I'm pretty sure it's $2½ thousand. That's the benchmark, in my view. If the Attorney has to sign off on something higher than that, I imagine we'd want to apply the same standard in your particular projects. So I'm just wondering if you could perhaps break down what is the top rate—I don't mind if you band it—for consultants and how much is being paid at that top rate—perhaps something above $2,500 and between $1,500 and $2,500. Could you just tell me how many contractors are being paid in each of those brackets and what the total value is within those brackets.

CHAIR: Mr Logan, one of the things that the senator's question is based on is an assumption of the policy setting. Do you have anything of that in your mind, about the policy settings that guide the delegated approvals?

Mr Logan : The delegated approvals for consultancies are that they're approved by the chief executive officer.

CHAIR: I appreciate that, but I'm certain there'll be discretionary limits. The point is that he's asked you to go away and do a whole host of work and bring back a whole host of information. That might be a moot point if a policy setting provided a discretion to the chief executive officer to approve that in the first instance. It may change the particularisation that the senator's after. He's assuming anything over $2,500 a day requires you to send it up to the moon, and they'll sit on it for a week. Is that the case, or does the chief executive officer have a threshold of approval above $2,500 for consultants in the program?

Mr Logan : Yes, the chief executive officer does have an approval greater than $2,500.

CHAIR: Right. So then Senator Patrick may well change what he's after.

Senator PATRICK: Thank you, Chair. That's very helpful of you. I was just looking at the Legal Services Directions, and in some sense this is the standard I put on all departments:

Senior counsel are not to be paid a daily rate above $3,500 … without the approval of the Attorney General. Junior counsel are not to be paid a daily rate above $2,300 …

So I'm interested in those bands, but what is the exact delegation within your organisation? When does the chief executive officer need to be involved, and when does a minister to be involved?

Mr Logan : In our case, the chief executive officer is able to sign, so all consultancies go through the chief executive officer for approval to engage consultants. There is no further approval sought from ministers, because we have a different governance arrangement.

And on the disconnection between RFFS firetrucks and the ADRs:

Senator PATRICK: Is it the case that we end up spending twice as much money just so that the truck can get a tick to drive on a road? How often would these trucks drive on a road?

Mr Porter : They are called to respond very frequently.

CHAIR: What does 'very frequently' mean? They go from the airport and put out a house fire?

Mr Porter : They will be called to provide mutual aid support in the event of a bushfire, a large factory fire, as we had at Footscray recently. The fire vehicles, being specialist—large amounts of water, large amounts of foam—do get called for assistance to provide support to our urban and local fire brigades.

Senator PATRICK: But when the trucks go out, they've got these lights on top that allow them to break a whole bunch of rules—road rules and so forth. I'll give you an example. Sometimes you have people in the Navy say that they want a ship to do 30 knots, and there's a supplier out there that can make a ship that does 29 knots. To get that one knot difference in speed costs you four times the amount of money. That might be an exaggeration, but it is a considerable amount of extra money just to get the one knot, whereas if you went back to the naval officer and asked what difference the one knot makes they may say that they like to round numbers off.

That's not important. This is a value-for-money question. What drives the cost of these things can be putting requirements on them that maybe, in the circumstances, where you've got an airport fire-fighting truck, you could simply waive yourself from those design rules, because most of the time they're going to spend their time on an airport and for the other remainder of the time they are going to an emergency. Has anyone talked about maybe having those design rules waived?

Senator STERLE: Can we ask what they are. It's very easy to say, 'Nothing to see here. Move along.' What are those ADRs? What are the differences? I know our ADRs can be quite archaic in this nation. Fill me in?

Mr Porter : Until such time as we choose the next vehicle or until we understand what vehicles are available, we won't know where the gap is between the ADR—

CHAIR: Tell us about the historical ones—ones that have prevented you, historically—upon which you relied to make the statement you did?

Mr Porter : I'm not familiar with the exact design rule—

Senator STERLE: Well, you mentioned them.

Mr Porter : I'm happy to take that on notice.

Senator STERLE: No, you used that as a defence for why it takes so long. Currently, they're built in China. Correct? And they've been built in China since—

Mr Porter : Austria.

Senator STERLE: Since 2003. So, their design rules meet Australian standards. Correct?

Mr Porter : Rosenbauer had a vehicle—it didn't comply. Therefore, Airservices had to take a position that effectively would influence the supply chain—the construction line of this vehicle—to ensure the vehicle produced off the construction line was compliant.

Senator STERLE: What is that compliance? An extra mirror, or what?

Mr Porter : I'm not exactly familiar with the—

Senator STERLE: You make it sound like it's millions and millions of dollars of research and development and changes. I'm not convinced. What is it?

Mr Porter : I can't—

CHAIR: I've got a low tolerance for this—almost zero tolerance. We've got someone here who is in charge of a division but cannot rely upon their answers to offset questions from this. Mr Harfield, where are you guys based?

Mr Harfield : Here.

CHAIR: I'll tell you what where going to do. We're going to stand you down while you go out the back and make some phone calls and bring someone here who can answer these questions. I don't care if you have to wait here until 11 o'clock tonight. Bring someone back who can answer these questions. And we'll move through our witness list and come back to you. How's that?

Mr Harfield : No worries.

2) Airservices Australia [14:44]

And for the Proserpine disconnection/charade/cover-up/ whatever...  

 

Senator PATRICK: ...We'll go back to the Proserpine delays. It's not the trucks that are the delay. Once again, I'm trying to understand: is there any other explanation for how long it's taken them? You might recall my former colleague Senator Xenophon was somewhat annoyed at the speed at which you required people to upgrade to ADS-B. You placed the requirement on aircraft operators to do certain things, but here we've got an instance where a regulation requires you to act. You've gone above 350,000 passenger numbers, but there's no requirement in terms of time under the act for you to respond to have a fire station. Maybe there's a lack in the regulation that just has this open-ended requirement that at some stage after you've hit 350,000 passengers—maybe 10 years later—you can have a fire station there.

Mr Harfield : No, it doesn't—

Senator PATRICK: How does it work, then?

Mr Harfield : I'll explain the process that we went through with Proserpine. We have already taken on notice to give the detail in there with the safety cases associated with it. With regard to your reference to the ATS-B, that requirement came out in 2005 for a 2017 implementation, just to put that into context. In September 2017 we received the 350,000. We've got a requirement to, within about three months, provide a safety case to CASA on how we will establish the service once it reaches 350,000. That safety case was submitted to CASA at the start of 2018 and we received it back in, I think, February 2018. It outlined the process we would take to establish the service by the middle of 2020. Once we received that, we started going through a procurement exercise for establishing and building the fire station. We have locate and work out where we can build the fire station to meet the response times. We've come to agreement with Whitsunday Coast Airport. We're now starting to build the fire station—or we've gone out to procurement and we've got that. We're about to have the contract finally negotiated and signed and, at the same time, ramp up the staffing levels to be able to staff that. This is all outlined in our safety case and the process that's there, and we can explain that. As we said earlier, we've taken it on notice to go back and have a look at that to see what we can accelerate.

CHAIR: Firstly, for the Hansard, we've had a document tendered under the heading of Airservices. It's a single page and opens with, '1. Australian design rules—ADRs.' Are there any objections to that being tendered? There being no objection, it is so tendered. Mr Logan, earlier you talked about the ICAO conventions impacting on the formula for how the freight rates are. But ICAO only applies to international routes, doesn't it?

Mr Logan : What I thought I said, for the Hansard, was that the international convention is that those are typically used. So not International Civil Aviation Organization conventions as such—

CHAIR: So it's not prescriptive.

Mr Logan : It's not prescriptive, no.

CHAIR: It's just that people have chosen for consistency to run them down through the domestic stuff as well.

Mr Logan : Yes.

Senator PATRICK: You've sparked my memory, Chair. Regarding the flight from Whyalla to Adelaide, you said before that, if you land at an airport in Melbourne in an A380 you get charged according to the category of fire services that would normally be required.

Mr Harfield : Your rate of charge is dependent on the category of the aircraft for the ARFF charge.

Senator PATRICK: If I only had a Q400, assuming the airport has no or low passenger numbers, there's no requirement to have a fire service for a Q400 to land. I'm just trying to work out—

Mr Harfield : Unless there are 350,000 passengers going through the airport, when we'd have to establish a fire service. Up to that stage, if there aren't 350,000 passengers passing through, there's no requirement to have an ARFF. Or the other requirement is that there's an international service.

Senator PATRICK: So the charge kicks in because of the 350,000?

Mr Harfield : The charge kicks in when we establish the service at the airport based on the 350,000.

Senator PATRICK: I was just trying to work out a way we could maybe not have these regional flights paying for these services, to somehow reduce the cost.

Mr Harfield : It's a user-pays service—it's only if there is a fire service there that they pay for it.

Senator PATRICK: And they pay according to the category of aircraft that they are?

Mr Harfield : Of what they are, yes. And in category 6, which is most regional aircraft, they pay that network charge that is networked across the entire operation. So it's subsidised by the capital city aerodromes.

CHAIR: Mr Harfield and, through you, your officers, thank you for your preparation and for meeting the additional demands we made on you today. We wish you safe travel back to your intended port.

Mr Harfield : Thank you.

 

MTF? - Yes much...P2