Chapter 4 : Transport outputs and programs

Australia's major roads and rail lines, which connect us to the global economy via our sea and air ports, are vital enablers of wealth creation. This is especially true for regional Australia, which generates two thirds of our export income.

With increasing globalisation and reliance on international trade, our nation's prosperity depends now more than ever on Australia having a transport system which is secure and safe, nationally and internationally competitive, accessible and sustainable.

Our Role

We lead portfolio agencies in helping the Australian Government achieve 'a better transport system for Australia'. Other agencies and governments also contribute to this outcome:

• the Civil Aviation Safety Authority (CASA) sets and enforces compliance with aviation safety standards, registers aircraft and issues licences to industry participants
• Airservices Australia provides air traffic control and navigation services as well as airport rescue and firefighting services
• the Australian Maritime Safety Authority (AMSA) is responsible for search and rescue for both the maritime and aviation sectors, seaworthiness of vessels over 300 gross registered tonnes in Australia, and marine oil spill and pollution response
• the Australian Maritime College provides education and training for the shipping and fishing industries
• the Stevedoring Industry Finance Committee (SIFC) manages residual matters and obligations arising from historical levies on the industry
• the Maritime Industry Finance Company (MIFCo) helps finance further reform and restructuring of the shipping and stevedoring industry
• state and territory governments own key infrastructure including major seaports and are constitutionally responsible for land transport
• the National Transport Commission advises governments on land transport issues as well as reforms to achieve safe, uniform and sustainable policies
• the Australian Rail Track Corporation (ARTC) manages the national interstate rail track and infrastructure network as well as train control services to that track, and
• local governments, including indigenous governing bodies, maintain local roads and deliver a range of other services (see also Output 2.4 Services to Local Government).

Private and not-for-profit bodies also contribute to this outcome.

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Our contribution

We are funded to deliver a range of transport-related outputs and programmes. This chapter reports on the outputs and programmes we were funded to deliver in 2003-04, as set out in table 4.1 overleaf. It:

• sets out the annual financial and other targets published in documents such as our 2003-04 Portfolio Budget Statements (PBS)
• explains our actual results in 2003-04 and compares them with previous years' results where applicable
• discusses factors that are affecting or that are likely to affect our results, such as our relationship with the stakeholders as identified above, and
• summarises progress towards achievement of the indicators nominated for each output and programme using the following ratings
  fully achieved mostly achieved partly achieved not achieved

As part of delivering our outputs and programmes, we also work towards specific priorities. In 2003-04, thirteen of our top 20 priorities related to transport. Our performance against these priorities is reported in Chapter 1. Our priorities for 2004-05 are set out in Chapter 2.

Table 4.1 - Transport outputs and programmes in 2003-04

	Budget a 2003-04$,000	Actual 2003-04$,000	Variance b	Progress	See also
Output 1.1 - Transport policy advice	15 979	12 844	19.6%		page
Administered programmes
Contributions to international organizations
- International Civil Aviation Organization	1 391	1 101	20.8%		page
- International Maritime Organization	310	265	14.5%		page
- OECD Road Transport	40	25	37.5%		page
Output 1.2 - Transport regulation and standards	47 506	44 993	5.3%		page
Administered programmes
Payments to airport lessees
- Compensation for sale of airport land	3	-	100%		page
- Reimbursement of parking fines	2 279	1 483	34.9%		page
Sydney West Airport
- rental properties	1 679	2 219	32.2		page
- land acquisitions and works	100	80	20.0%	n/a	n/a
National Road Transport Commission	620	620	-		page
National Transport Commission	1 830	1 830	-		page
Interstate Road Transport Fees	42 030	41 537	1.2%		page
Output 1.3 - Transport safety investigations	13 403	12 521	6.6%		page
Administered programmes - nil
Output 1.4 - Transport programmes	11 876	11 484	3.3%		page
Administered programmes
Aviation security enhancements - regional airport security	35 000	35 000	-		page
Airports Quarantine Infrastructure	6 000	4 283	28.6%		page
AusLink - Grant to ARTC	450 000	450 000	-		page
National Highway and Roads of National Importance	931 685	931 685	-		page
Road Safety Black Spot	44 500	44 500	-		page
Roads to Recovery	302 163	302 163	-		page
Federation Fund Projects
- Caboolture Motorway	30 000	24 780	17.4%		page
- Murray River Bridges	19 236	8 538	55.6%		page
Gold Coast Rail Project	377	230	39%		page
Payments to MIFCo	9 677	9 684	0.1%		page
Tasmanian Freight Equalisation Scheme	82 000	83 632	2.0%		page
Bass Strait Passenger Vehicle Equalisation	38 980	34 340	11.9%		page
Subsidy for transition to location-specific pricing for airport control towers	7 000	7 000	-		page
Payment Scheme For Airservices Australia's Enroute Charges	6 000	4 295	28.4%		page
Remote Air Services Subsidy Scheme	2 970	2 590	12.8%		page
Tamworth Australasian-Pacific Aeronautical College	1 258	1 255	0.2%		page
Implementation of noise amelioration
- for Sydney Airport	8 191	3 927	52.1%		page
- for Adelaide Airport	16 628	13 931	16.2%		page
Management of residual issues of former Australian National Railways Commission	500	80	84.0%		page
Oil Pollution Compensation Fund	2 000	12 066	503.3%
Output 1.5 - Transport research and data	12 685	9 470	25.3%		page
Administered programmes - nil
Total price of departmental outputs	101 449	91 312	10.0%
Plus provision for asbestos claims	-	63 400	n/a		page
Less receipts from independent sources	1 273	3 639	185.9%
Net price to government for outputs(Appropriation)	100 176	151 073	50.8%
Total cost of administered programmes	2 044 447	2 023 137	1.0%
Plus other costs including depreciation	1 464	1 551	5.9%
Total administered operating expenses	2 045 911	2 024 688	1.0%
Less administered revenues	225 275	232 765	3.3%
Net cost to government of administered activities	1 820 636	1 791 923	1.6%
Average Staffing Level (ASL)	524.6	508.9	3.0%

a The budget is the revised budget published in our 2004-05 Portfolio Budget Statements rather than that published in our 2003-04 Portfolio Additional Estimates Statements. This change reflects the government decision to bring forward a third set of appropriation bills in 2003-04 in support of several new initiatives.
b The variance is the change in our 2003-04 actuals over our revised 2003-04 budget.

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Output 1.1: Transport policy advice

(Policy and Research Group, Regulatory Group, Safety and Investigation Group)

Description	Performance indicators	Progress
The department provides policy advice and other services to its ministers in relation to: safety and security of transport infrastructure and operations competitiveness of Australian international and domestic transport within, and between, all modes access and sustainability of transport systems and the consideration of social, environmental and community impact.	Effectiveness: transport and logistics systems meet international or national standards or benchmarks related to safety, security, competitiveness, sustainability and accessibility stakeholders' interests are considered in policy development priority policies are substantially progressed ministers and ministers' offices are satisfied with the quality of policy advice and legislation development, and the department meets standards for policy advice, legislation and ministerial services. Price: $16.0m (down from $35.7m at Budget)

Report on performance

We provide advice and other services to our ministers in anticipation of being needed, or as required by them. In 2003-04, we continued to achieve more than 95 per cent satisfaction with the briefs and correspondence we prepared. In doing so, we supported our ministers to:

• exercise powers and meet their responsibilities under approximately 80 pieces of portfolio legislation relating to transport
• develop the AusLink White Paper - Building our National Transport Future - which sets out the Australian Government's new land transport policy (for details see Chapter 1)
• chair the Australian Transport Council (ATC), which endorsed the National Transport Security Strategy we took to it in April 2004
• make submissions and respond to relevant inquiries, including the National Competition Council review of the application for declaration of airside services at Sydney Airport and the Neville Inquiry into Maritime Salvage in Australian Waters
• respond to representations from other ministers, members of parliament and constituents on related issues, and
• decide which standards and agreements to endorse in a national and international context (see also Output 1.2 Transport regulation and standards)

We nominated experts to help draft and review international standards and practices for all modes of transport (sea, air, road and rail). We also administered payments to three key international bodies in line with Australia's membership of these bodies.

We generally aim to deliver our outputs at an agreed price. For this output, our final result for 2003-04 was $12.8 million. This result was significantly lower than planned and than in previous years (see table 4.2). It reflects self-imposed expenditure restraint under the Work out/Work up plan as discussed in Chapter 1.

Safety and security of transport infrastructure and operations

Security and safety issues dominated much of our work in 2003-04. We led work to develop a new maritime security regime and to expand Australia's aviation security regime, as highlighted in Chapter 1 (see also case study). In addition, we:

• worked as a member of the National Counter-Terrorism Committee to reduce the likelihood of transport being targeted or used by terrorists
• participated in contingency planning in response to other emerging issues, such as avian (bird) flu and Severe Acute Respiratory Syndrome (SARS), and
• funded and released a study into Deep Vein Thrombosis (DVT) in air travellers, in collaboration with the Department of Health and Ageing.

Competitiveness of international and domestic transport within and between all modes

We also made good progress towards our vision of a competitive transport system for Australia. The government finalised negotiations and signed the lease for key rail infrastructure in NSW, as highlighted in Chapter 1 (see also case study). In addition, we:

• developed national processes and guidelines for evaluating road, rail and multi-modal proposals to promote national consistency in infrastructure planning and management
• worked with the Department of Finance and Administration to effect the sale of the Sydney Basin Airports (Bankstown, Camden and Hoxton Park) in December 2003
• continued to work with the Australian Tax Office to administer agreements under the Infrastructure Borrowings Tax Offset scheme, which provides tax offsets for income earnt on loans to approved projects
• advised the government on policy settings on regional aviation, including options for responding to the Neville parliamentary report on regional aviation and island transport
• pursued more liberal air services arrangements through bilateral and multilateral negotiations (see case study)
• managed nine projects funded by the Asia-Pacific Economic Cooperation forum (APEC) to help liberalise trade and enhance transport capacity in the region, and
• provided policy advice on global navigation satellite systems, and secretariat support for the Australian Global Navigation Satellite System Coordination Committee.

Access and sustainability of transport systems

In 2003-04 we continued to provide advice and comment as required by the Environment Protection and Biodiversity Act 1998, to assist the government to meet its broader environmental obligations. We also:

• worked with the Energy Task Force on the White Paper - Securing Australia's Energy Future - which recommended reforms to fuel excise arrangements
• supported the Australian Bicycle Council to implement the Australian National Cycling Strategy 1999-2004 and to increase cycling for transport and recreation, and
• worked with the Attorney-General's Department to implement new national standards to help make public transport more accessible to people with disabilities.

For more information on the disability standards for public transport, see Appendix D or visit www.ag.gov.au/DSFAPT

Table 4.2 - Trends in transport policy advice and related programmes

a The forward estimates shown are the best available estimate at time of printing but we will not know the actual cost of our contribution to the ICAO, for example, until December 2004.

Administered programme - International Civil Aviation Organization - contribution (Regulatory Group)
Description	Performance indicators	Progress
The ICAO is an agency of the United Nations. It promotes the safety, regularity and efficiency of international civil aviation.	Effectiveness: draft international aviation safety and operational standards reflect Australia's interests Quantity: payments made in accordance with agreed schedule Cost: $1.4m

Australia has been an active member of ICAO since it was set up in 1947. Australia's annual contribution to the ICAO is assessed in US dollars around December each year. In 2003-04, we continued to pay Australia's contribution promptly. It cost less than expected and than in previous years, largely due to a favourable exchange rate at the time of payment (see table 4.2).

Australia has been elected to the ICAO Council as a Category One State of Chief Importance in Civil Aviation every year except 1971. Australia continued to be recognised as such in 2003-04 and had a permanent presence at ICAO headquarters at Montreal 1. The department currently represents Australia on the ICAO Council and on ICAO committees on air transport and unlawful interference.

The 30/30 working group of ICAO recently released a case study on implementing a 30 nautical mile separation standard to allow more aircraft to cruise at the most fuel-efficient cruising height. This new standard will be applied to trans-Tasman flights from 2004-05.

1 All Category One member states are required to maintain a permanent presence in Montreal. Australia's representatives are provided by DOTARS and other portfolio aviation bodies. Departmental staff seconded to the ICAO are not included in the workforce statistics at Appendix H as they are paid through the ICAO during their secondment.

Administered programme - International Maritime Organization - contribution (Policy and Research Group)
Description	Performance indicators	Progress
The IMO is an agency of the United Nations (UN). It aims for 'safer shipping and cleaner oceans'.	Effectiveness: international agreements for shipping operators, ship safety and protection of the marine environment reflect Australia's interests Cost: $0.3m

Australia has been an active member of the IMO since it was set up in 1959. Our contribution to the IMO is assessed in British pounds. In 2003-04, Australia's contribution cost less than expected and than in previous years due to a favourable exchange rate at time of payment (see table 4.2).

One of the smallest of all UN agencies, the IMO has successfully led international efforts to cut ship casualty rates and the amount of oil entering the sea from ships. In recent years, the IMO has focused on working with member states to enhance maritime security and to implement the International Ship and Port Facility Security Code. The code, which came into force on 1 July 2004, requires all international ships and port facilities to have an approved security plan.

Compliance with the code is important to minimise technical barriers to trade, and we worked closely with state governments and industry to implement new maritime security arrangements over 2003-04 (see case study).

Administered programme - OECD Road Transport - contribution (Policy and Research Group)
Description	Performance indicators	Progress
OECD research has historically focused on road transport. Its focus was formally broadened to include rail and intermodal issues from 1 January 2004.	Effectiveness: efficiency, safety and environmental performance of road transport in Australia improve through international cooperation Cost: $0.040m

Australia is a member of the Organisation for Economic Cooperation and Development (OECD) and we support its transport research programme. Australia's contribution to the OECD is assessed in US dollars. In 2003-04, it cost less than expected and than in previous years due to a favourable exchange rate at time of payment (see table 4.2).

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Output 1.2: Transport regulation and standards

(Regulatory Group, Policy and Research Group)

Description	Performance indicators	Progress
The department aims to be efficient, effective, responsive and ethical in administering the relevant legislation and regulations through: transparent identification of the contribution that regulatory activity makes to the achievement of the department's outcomes and outputs identification of the costs and benefits of regulatory activity and a commitment to increasing the benefits and reducing the costs associated with these activities.	Effectiveness: transport standards, regulations and agreements contribute to improved transport safety, security, competitiveness, sustainability and accessibility benefits of regulatory activity are identified and increased and costs reduced new and amended standards, regulations and agreements are developed, reviewed and administered in accordance with government policy and departmental standards revenue is collected and reported in accordance with legislation and departmental standards. Price: ($47.5m (up from $28.1m at Budget)

Report on performance

We monitor, advise on and administer regulations relating to all modes of transport. Our role extends to advising on issues that go to the role of other transport regulators including CASA, Airservices Australia and AMSA. In this capacity, and as reported in Chapter 1, we:

• continued to support aviation safety and airspace reforms
• worked with the Australian Logistics Council to improve the handling and transport of dangerous goods, and
• implemented legislation to replace the National Road Transport Commission (NRTC) with a broader National Transport Commission (NTC) as planned in early 2004.

We also continued to administer payments to the NTC, and to collect and make payments under the Federal Interstate Registration Scheme.

We directly regulate aspects of transport across all modes of transport, and review the legislation that we administer on a regular basis. In 2003-04, we:

• published our annual regulatory plan early in the financial year as required
• completed or continued work on reviews of aspects of aviation regulation in line with our regulatory plan
• continued to issue adequate Regulation Impact Statements (RISs) for most proposals for new and amended regulations which affect business
• obtained a definitive decision on the minister's powers in the area of motor vehicle imports through a landmark Federal Court decision, as discussed in Chapter 6, and
• prepared our regulatory plan for 2004-05, which was released in July 2004 and is available online at www.dotars.gov.au/department/dotars/regulatory.aspx 

More information about our performance in 2003-04 by sector follows below.

Price of output

We aim to deliver our outputs at an agreed price but a number of government decisions saw us take on substantial new functions and resourcing during 2003-04. Additional resources were mainly associated with decisions to:

• enhance aviation security ($42.7 million over five years)
• implement new maritime security arrangements in line with the IMO's International Ship and Port Facility Security Code ($12.2 million over two years)
• improve aviation security information collection and dissemination capacity from Indonesia and the Philippines ($2.4 million over four years)
• strengthen Australia's counter-terrorism capability by seconding transport security analysts to the National Threat Assessment Centre in ASIO ($2.1 million over five years), and
• implement the National Airspace System ($2.1 million in 2003-;04).

Our final result, $45.0 million, was less than our revised budget for 2003-04 but was above our 2002-03 result (see table 4.3).

The price of this output is forecast to increase further in 2004-05. As announced in the 2004-05 Budget, the government will provide the department with substantial additional resources to:

• establish an Inspector of Transport Security to identify and address security vulnerabilities ($1.6 million over four years)
• assist countries in the Asia-Pacific region to improve transport security ($4.7 million over four years)
• progress critical infrastructure protection in partnership with states and industry ($2.4 million over four years)
• promote specific initiatives to reduce vehicle emissions ($3.2 million over four years), and
• improve the department's capacity to carry out audit and compliance work under the Motor Vehicle Standards Act 1989 ($3.1 million in 2004-05).

Table 4.3 - Trends in transport regulation resourcing

a This activity was funded through departmental resources until 2003-04.
b Due to a transposition error, this was reported as 245 in our 2002-03 annual report (page 65)

Aviation regulation

The aviation industry provides crucial transport services linking Australia with other countries and domestically providing affordable and convenient links between communities. The industry has rebounded strongly in the three years since the events of 9/11 and the collapse of the Ansett group of companies. The department's role is to:

• monitor the security of airports and aircraft (see case study)
• minimise the impact of airport operations on nearby communities, and
• manage the Commonwealth's interests in 22 leased airports nationwide.

Aircraft noise. Regardless of its size, purpose or ownership, all aircraft in Australia are required to comply with aircraft noise regulations under the Air Navigation Act 1920. In 2003-04, we issued fewer aircraft noise permits than in previous years due to a decline in the number of applications (see table 4.4). We also started a review of the Air Navigation (Aircraft Noise) Regulations 1984 as planned.

Curfews apply at four airports to minimise the impact of airport operations on nearby communities. In 2003-04 we continued to manage the curfew system, and issued occasional curfew exemptions, in line with the legislation. We also brought forward changes to the Sydney Airport Curfew Regulations 1995, to deal with changed circumstances in the air freight industry. This regulatory activity, combined with noise amelioration work, has contributed to a substantial reduction in noise complaints, particularly around Sydney airport.

Leased airports. Between 1997 and 2003 a total of 22 airports owned and operated by the Australian Government were privatised. The sales, which involved leasehold rather than freehold title, were conducted in five stages and raised $8.5 billion. We are responsible for administering Commonwealth interests in the ongoing operation and management of privatised airports under the Airports Act 1996.

Under the Act, airport lessees must produce a master plan with a 20-year planning horizon and revisit the master plan every five years. Master plans are focused mainly on development of the airport site itself, but must also have regard to surrounding land or the associated needs of non-airport users. Lessees must also invest in infrastructure at airport sites and submit major development plans to the minister for approval. In 2003-04, we reviewed and the minister subsequently approved:

• three airport Master Plans, and
• five Major Development Plans.

We confirmed that six airport lessees had met their Period One Development Commitment obligations worth more than $186 million. In addition, we:

• undertook 19 reviews of federally leased airports, to ensure compliance with lease conditions, of which 17 were completed by 30 June 2004
• managed a number of contracts for building controllers and environmental officers who monitor compliance by airport lessees and tenants with environmental and building standards
• reviewed tolerances for water pollution set in the Airports (Environment Protection) Regulations 1997 (Schedule 2)
• administered payments to airport lessees totalling $1.5 million, mainly in respect of parking infringement notices
• undertook a review of the Airports Act 1996, taking into account 61 submissions received from a broad range of stakeholders, and
• brought forward changes to the Airports Regulations 1997.

Also in 2003-04, the Australian National Audit Office (ANAO) released a report on our administration of lessee obligations entered into as part of the sale of the first 17 airports. The report, which followed up on audits of early sales, found that the department took some time to develop procedures to administer key aspects of contracts, but that our approach has been influenced by profound changes in the aviation environment and has improved since 2002. While we question some of the ANAO's analysis, we have agreed with six recommendations and agreed with qualification to the remaining three recommendations.

Other. In 2003-04, we administered a range of properties at Badgerys Creek. We also conducted safety checks at 58 remote landing strips belonging to indigenous communities to assess compliance with CASA regulations.

Table 4.4 - Trends in aviation regulation

a These statistics refer to scheduled inspections of relevant airlines and airports, and do not include unscheduled inspections, incident investigations or other workload such as industry workshops. The level of inspections scheduled varies over time and takes into account factors such as levels of airline activity and global events such as occurred on September 11, 2001.

Maritime regulation

Australia depends almost exclusively on shipping to move its exports and imports and has the fifth largest shipping task in the world, in terms of tonnes of cargo shipped and kilometres travelled. The department's role is to:

• ensure the security of port and shipping facilities (see case study)
• regulate trade, and
• protect the sea and marine environment from maritime pollution.

Regulation of trade. All vessels trading interstate must be licensed or have a coastal permit to carry cargo or passengers under the Navigation Act 1912. The volume of applications for licences and permits fluctuates from year to year with demand for coastal shipping services. As detailed in table 4.5, in 2003-04:

• slightly more vessels held coastal trading licences 2
• fewer single voyage permits but more continuing voyage permits (valid for three months) were issued to other vessels in the public interest, and
• we continued to issue 100 per cent of permits within target timeframes.

Efficient operation of shipping. Part X of the Trade Practices Act 1974 gives ocean liner carriers immunity from key parts of Australia's trade practices laws: it allows them to form conference agreements to provide regular scheduled cargo shipping services to importers and exporters. These agreements operate on nearly all Australian trade routes and cover varying amounts of trade on each route.

A wide range of agreements are registered with the department under the Act, each of which is specific to an individual trade route. In 2003-04, ongoing changes in the ocean liner industry saw us register fewer new shipping agreements but more variations to existing agreements. We continued to register 100 per cent of agreements and variations within 14 days of receipt.

The Productivity Commission also began a review of the operation of Part X of the Act, and is expected to present its final report to government in 2005.

Protection of the sea. Being an island continent, Australia is economically dependent on its sea lanes and port operations - resulting in a continual risk of pollution to the marine environment. In 2003-04 we:

• enacted regulations to prohibit ships from discharging untreated sewage into waters within 12 nautical miles of land (Annex IV of MARPOL 3), and
• continued to collect compensation from oil companies in connection with oil spills and to pass this on to a special fund to cover associated clean-up costs.

2 Licences are issued on condition that the crew are paid Australian wages while trading on the Australian coast and have access to the vessel's library.
3 The MARPOL Convention is the main international convention covering prevention of pollution of the marine environment by ships from operational or accidental causes. It is a combination of two treaties adopted in 1973 and 1978 respectively and updated by amendments through the years.

Table 4.5 - Trends in maritime regulation

Motor vehicle imports and standards

The Australian Government has jurisdiction over motor vehicles up to the point of first supply to the market. Once a vehicle has been supplied to the market, it falls within the purview of individual state and territory governments. In this context, our role is limited to:

• developing standards for motor vehicles
• assuring compliance of vehicle 'types' with these standards
• registering workshops which supply limited numbers of used vehicles to the specialist and enthusiast market
• approving motor vehicle imports, and
• investigating reports of safety defects and monitoring safety recalls.

Standards for motor vehicles. Before any road vehicle can be supplied to the market in Australia, it must comply with the Motor Vehicle Standards Act 1989. The Act, which applies to imported as well as locally manufactured vehicles, requires all vehicles to meet national safety and environment standards. These standards are the Australian Design Rules (ADRs).

We are progressively reviewing the ADRs to harmonise them, where possible, with international standards developed under the United Nations Economic Commission for Europe framework. In 2003-04 we continued our review of the ADRs. We repealed seven regulations and made good progress on:

• two RISs on underrun protection for heavy vehicles and on intrusive seatbelt reminders, and
• three heavy vehicle regulations for public comment - subject to feedback, these will probably be released later in 2004.

In 2003-04 we also worked with the Australian Greenhouse Office to develop the Green Vehicle Guide. The guide, which was launched in August 2004, is a world-leading internet tool to help consumers rate and compare vehicles according to their impact on the environment. We will receive an extra $3.2 million over four years from 2004-05 to:

• promote the Green Vehicle Guide http://www.greenvehicleguide.gov.au/, and
• develop environmental performance criteria for heavy vehicles which operators must meet to qualify for excise credits.

Compliance of motor vehicles. Manufacturers and importers must demonstrate that their vehicle types meet the ADRs before the vehicle types can be supplied to the market in Australia. The vehicle certification process involves the department assessing test data electronically and verifying it through quality assurance audits of manufacturers and inspections of test facilities.

In 2003-04 we scaled back our audit programme in response to greater than expected demand for approvals and inspections, particularly under the Registered Automotive Workshop Scheme (RAWS). Inspection and audit activities are expected to return to more normal levels in 2004-05 as a result of the government decision to provide an extra $3.1 million for this function. This amount includes funding for research, as well as $1.1 million capital for information technology to support compliance activities.

RAWS. Special compliance arrangements apply for manufacturers and importers who supply limited numbers of used vehicles to the specialist and enthusiast market. RAWS, which replaces the former low volume scheme for used vehicles, began on 1 April 2002 and became mandatory on 8 May 2003 for imported used vehicles.

Workshops are inspected when the first approval is obtained and again for each vehicle model that the workshop is approved to process. In 2003-04, it became difficult to keep pace with demand for inspections. However, we were able to reduce turnaround times from 18 weeks in February 2004 to around five weeks at the end of June 2004 by recruiting extra staff.

Motor vehicle imports. In 2003-04 the number of import approvals processed rose by eight per cent. At one point, we had difficulty maintaining our service charter target of 17 working days and this resulted in a number of complaints. We were able to reduce turnaround times to within target levels by the end of June 2004 by recruiting extra staff.

Safety defects and recalls. Occasionally vehicles sold in Australia are found to contain a safety defect. Under the Trade Practices Act 1974, suppliers must recall goods which will or may cause injury. We investigate reports of vehicle safety defects and monitor the effectiveness of each vehicle safety recall. The number of reports and recalls fluctuates from year to year. For complete and up-to-date information on safety recalls, visit dynamic.infrastructure.gov.au/recalls/index.asp
For more information on trends in motor vehicle regulation over time, see table 4.6 below.

Table 4.6 - Trends in motor vehicle regulation

Administered programme - Compensation to Airport Lessees for sale of airport land (Regulatory Group)
Description	Performance indicators	Progress
This programme compensates airport lessees for the sale of land.	Effectiveness: clients are satisfied with the level of service Quality: compensation provided to airport operators in relation to the sale of airport land within 10 working days from receipt of a valid tax invoice following completion Cost: $3,000 (down from $0.1m at Budget)

We administer compensation payable to airport lessees following the sale of airport land. In 2003-04 the only airport where compensation was identified was Hobart Airport. Funding has been held over to 2004-05 to be paid once Hobart International Airport Ltd and the Tasmanian Government have finalised their agreement on the land transfer in question.

Administered programme - Airport lessee companies - reimbursement of parking fines (Regulatory Group)
Description	Performance indicators	Progress
This programme provides incentives for airport lessees to enforce parking zones in airport precincts.	Effectiveness: reduced net costs to Airport Lessee Companies of issuing parking infringement notices Cost: $2.3m

We make payments to airport lessee companies based on a formula set by the Minister for Finance and Administration, namely 80 per cent of the revenue collected from parking fines after our administrative costs.

We revise programme budgets several times each year in light of the total funds that may be required. Our final result for 2003-04, $1.5 million, reflects lower that usual levels of parking infringements and fines.

Administered programme - Sydney West Airport - rental properties (Regulatory Group)
Description	Performance indicator	Progress
This programme pays for water and land rates, maintenance and other costs associated with renting out properties on and around the proposed site of the Sydney West Airport.	Effectiveness: Commonwealth's interests in Sydney West Airport are managed Quality: management of the rental properties at the Sydney West Airport site Quantity: management of approximately 254 properties Cost: $1.7m (up from $1.6m at Budget)

The Commonwealth owns and leases out a number of commercial and residential properties at Badgerys Creek. The properties are on and around the proposed site for a second international airport for Sydney and are managed by Zeckendorf Asset Management to ensure they remain in a reasonable condition.

We revise programme budgets several times each year in light of the total funds that may be required. Our final result for 2003-04, $2.2 million, was higher than expected and than in previous years. This result reflects the costs of repairing extensive storm and bushfire damage and of meeting more stringent local council requirements for septic tanks.

We will continue to monitor the costs of this programme closely in 2004-05. There is limited scope, however, to scale back maintenance and repair work given our duty of care to tenants and our responsibility to government to keep the assets we administer in good condition.

Administered programmes - National Road Transport Commission (NRTC) - National Transport Commission (NTC) (Regulatory Group)
Description	Performance indicator		Progress
Like the NRTC before it, the NTC is an independent statutory authority. It operates under the National Transport Commission Act 2003.	Effectiveness: nationally harmonised regulations contribute to improved road transport efficiency, safety and environmental performance Quantity: payments made in accordance with agreed schedule
	Cost:	NRTC - $0.6m NTC - $1.8m

Under Australia's Constitution, the states and territories are largely responsible for regulating road transport. Each state and territory has traditionally made its own laws in such areas as road rules, vehicle standards and driver licensing. Over time differences between these laws became more and more of an impediment to the efficient movement of freight and law reform between jurisdictions, especially for heavy vehicle freight transport, became problematic.

The NRTC was established in 1991 to develop uniform arrangements for vehicle regulation and operation, and consistent charging principles for vehicle registration. As reported in Chapter 1, the NRTC was replaced by the NTC as planned in early 2004.

The NTC has a broader charter to continue reform of road transport regulation and operations and to undertake reform of rail and intermodal regulation and operations. It reports to the Australian, state and territory transport ministers through the Australian Transport Council.

While the NTC only came into existence on 15 January 2004, in practice its predecessor the NRTC took on a broader role in rail from 1 July 2003. This explains why, in 2003-04, the contribution of the Australian Government to the NTC rose to $2.4 million, compared to $1.2 million in 2002-03. The Commission's total budget was around $7 million and was used to develop a range of transport reforms. In 2003-04, the NTC also:

• gained ministerial approval for a Performance Based Standards policy which, when finalised, will improve productivity, safety and ecological sustainability
• obtained ministerial approval for guidelines to help transport contractors carrying dangerous goods to prepare an Emergency Response plan, and
• released a draft code on managing fatigue in heavy vehicle drivers, as part of a review of hours of work and rest for drivers.

In 2004-05 the NTC is expected to focus on identifying improvements to the existing rail safety co-regulatory framework and developing model legislation and other supporting processes and documentation for adoption on a national basis.

For more information about the activities of the NTC, see http://www.ntc.gov.au/

Administered programme - Interstate Road Transport Fees (Regulatory Group)
Description	Performance indicator	Progress
This programme passes registration charges for vehicles engaged in interstate trade on to state and territory governments. It is administered under the Interstate Road Transport Act 1985, the Interstate Road Transport Charge Act 1985 and related regulations.	Effectiveness: national road transport reform continues to support improved transport efficiency, safety and environmental performance Quality: contribution to the implementation of national road transport reform through the Federal Interstate Registration Scheme Cost: $42.0m (up from $38.1m at Budget)

The Federal Interstate Registration Scheme was set up in 1987 as an alternative to state based registration for heavy vehicles weighing 4.5 tonnes or more. The scheme was designed to provide uniform charges and operating conditions for heavy vehicles engaged solely in interstate operations.

Vehicles registered under the scheme may not be used for intrastate work, and must deliver goods to an interstate address in a continuous journey with the origin/destination documented in a consignment note. Special purpose vehicles such as mobile cranes cannot be registered under the scheme. State/territory permits may be required for vehicles carrying large loads or operating in combinations (such as in a road train).

To register, operators apply to the registration authority in their jurisdiction of residence and pay the same charges as for a state-registered vehicle. Federally registered vehicles must also comply with relevant ADRs and any other relevant standards, and must have compulsory third party insurance for the period of registration.

Revenue collected by state and territory authorities is passed on to the Australian Government and then redistributed based on an agreed formula designed to meet the costs of damage to roads caused by heavy vehicles.

Heavy vehicle registration charges were increased as of 1 July 2003. The resultant increase in revenue has been passed on to state and territory governments in full, and explains why the cost of this programme rose to $41.5 million in 2003-04.

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Output 1.3: Transport safety investigations

(Safety and Investigation Group)

Description	Performance indicators	Progress
The department, through the Australian Transport Safety Bureau (ATSB), contributes to the maintenance and improvement of transport safety and public confidence by undertaking: independent transport accident, incident and safety deficiency investigations safety communication and education.	Effectiveness: transport safety and public confidence in transport safety is maintained and improved stakeholder acceptance of safety messages, including consideration and implementation of recommendations, safety advisory notices and other safety actions safety investigations are completed in a timely manner. Price: $13.4m

Report on performance

The ATSB contributes to transport safety, and to public confidence in public safety, by independently investigating and openly reporting on aviation, maritime and rail transport safety matters.

All our investigations are 'no blame' - our emphasis is on learning to improve future safety. We also prefer to report positive safety action, but we do make formal recommendations to safety regulators, manufacturers and other stakeholders where necessary.

The Transport Safety Investigation Act 2003, which came into effect on 1 July 2003, has consolidated and modernised our powers in aviation and marine safety and has expanded the ATSB's powers to enable us to undertake rail investigations on the Defined Interstate Rail Network. The Act has also confirmed that the ATSB has primacy in investigation unless there is a clear case of 'unlawful interference' such as terrorism. It further protects sensitive information from use in criminal or civil proceedings other than coronial inquiries.

In support of the Act, we have signed MOUs with five rail safety regulators, Comcare, and Airservices Australia. These MOUs will facilitate cooperation including where both parties are conducting parallel investigations. Stakeholders with whom we are finalising MOUs include police authorities, safety regulators (CASA, AMSA) and the Australian Defence Force (Defence Flight Safety).

Aviation safety

All accidents and incidents relating to flight safety in Australia or by Australian operators must be reported to us. We record accident and investigation data for possible future safety analysis and selectively investigate serious occurrences including fatal accidents that we believe will yield the most useful safety benefits especially for fare-paying passengers.

In 2003-04, we released 63 investigation and technical reports including important reports on fatal accidents at Hamilton Island, Bankstown, Moorabbin and Toowoomba and on a Saab 340 serious icing incident near Bathurst.

We completed fewer investigations than in previous years and the median completion time for investigations increased. This trend reflects factors including the three years it took to finalise the Toowoomba air crash investigation and preparations for a major audit by ICAO.

Resourcing was also an issue, and the government has recognised this by providing extra funding over the four years from 2004-05, for more investigations into aviation accidents and incidents ($8.2 million) and to replace our aviation investigation database ($6.1 million).

Aviation safety messages continued to be well accepted by stakeholders including CASA and Airservices Australia. Changes have been made in response to our recommendations on:

• Certain aspects of the National Airspace System following a close proximity incident near Launceston in December 2003 - Airservices and CASA agreed to relevant ATSB recommendations on education, training and chart frequency material.
• Robinson helicopter rotor blades - in March the US Federal Aviation Administration and CASA issued safety directives to reduce the calendar life of Robinson R22 main rotor blades.
• The use of alcohol and cannabis in the aviation industry - a joint CASA/departmental inquiry on this issue will report to the government later in 2004-05.

Australia's aviation safety in the decade to December 2003 has improved markedly. The fatality rate for the general aviation sector has fallen from 3.0 per 100 000 hours flown to 2.1 per 100 000 hours flown. Over the same period the accident rate has dropped from 12.2 per 100 000 to 7.9 per 100 000 hours flown. However, one major crash would change this picture - there is no room for complacency.

We maintain a high response capability against the possibility of a major fatal air crash in Australia. We coordinated an on-site scenario exercise called 'Popflot' in October 2003 (see case study opposite). We also worked with Emergency Management Australia on a new umbrella plan for handling a major aviation disaster called AVDISPLAN which was released in March 2004.

As resources permit, we send investigators overseas to assist with, and gain experience in, major accidents. In 2003-04, we completed the joint investigation into the fatal crash of a Lao-registered Ilyushin IL76 Russian cargo aircraft near Baucau East Timor with the Australian Defence Force and in cooperation with Russian investigators.

ATSB also released ten aviation research reports in 2003-04. These are reported under Output 1.5 Transport research and data.

Table 4.7 - Trends in aviation safety investigation a

a Fewer notifications were made in 2003-04 due to changed reporting requirements from 1 July 2003 under the Transport Safety Investigation Act 2003 and regulations.
b While the government has provided extra funding for more investigations from 2004-05, the time required to recruit and train investigators means that this will take some time to impact on the number of investigations completed and the median time for investigations.

Maritime safety

Accidents and incidents involving Australian registered ships and foreign flag ships in Australian waters must be reported to us. Often such information will be received through a report to AMSA. As with aviation safety, we do not investigate all marine incidents, but record all data for possible future safety analysis.

In 2003-04, we released 17 marine investigation reports and completed two ferry reports on behalf of the NSW Office of Transport Safety Investigation. Reports released included the Doric Chariot grounding in the Great Barrier Reef and the Star Sea Bridge/Sue M collision, which had been held over pending a criminal trial and was released 32 months after the incident. This explains the slight decrease in the number of investigations more than one year old and the increase in the median completion time for investigations.

The ATSB distributes its marine investigation reports and safety and educational material nationally and internationally and promotes marine safety in Australia and overseas. In 2003-04 the ATSB issued 47 marine recommendations to marine safety regulators, operators and stakeholders.

On 20 May 2004, we launched the Confidential Marine Reporting Scheme. This scheme offers seafarers the opportunity to report unsafe conditions, practices or procedures on board merchant ships without fear of being identified. By being able to do this, seafarers are able to promote their own safety and, by reporting their concerns, they are able to assist with preventing, or minimising the risk of, marine accidents.

Maritime safety messages contained in our reports are widely distributed and well received by all sections of the marine industry. In several cases, the recommendations have been taken up within the industry. In 2004-05, we will be conducting a safety awareness campaign aimed at commercial fishermen around the country. This campaign is designed to reduce the risk of collisions by raising awareness of causal factors identified in our investigations into collisions between fishing vessels and merchant ships.

Rail safety

The Transport Safety Investigation Act 2003, which came into effect on 1 July 2003, empowers us to investigate incidents on the Defined Interstate Rail Network. However, in 2003-04, we also gave priority to completing legacy investigations requested by state authorities under state legislation.

We completed three investigations - the Spencer Street 'runaway train', Aloomba Queensland and Chiltern Victoria rail accidents. The Spencer Street and Aloomba investigation reports were released in December 2003 and we forwarded the Chiltern Report to the Victorian Transport Minister for his consideration. We expect to complete the fourth investigation, into an accident at Benalla in Victoria, later in 2004-05 along with new investigations into five rail accidents that occurred on the Defined Interstate Rail Network in 2003-04.

Rail safety messages have been accepted by relevant state authorities. Common themes included the need for engineering changes to rolling stock to ensure operations were more tolerant of human error, changes to procedures, and training of personnel.

In late 2004 the ATSB will open a rail investigation field office in Adelaide. Existing ATSB rail investigation offices in Adelaide, Canberra and Brisbane facilitate onsite accident response throughout the defined interstate rail network plus important industry liaison activities.

Road safety

The ATSB coordinates the National Road Safety Strategy and two-yearly action plans on behalf of the Australian Transport Council. It also undertakes transport safety research and statistical work and releases associated reports. These activities are reported under Output 1.5 Transport research and data.

Price of output

We generally aim to deliver our outputs at an agreed price. Our final result for Output 1.3 in 2003-04 was $12.5 million. This result reflects lower than planned expenditure for more complex aviation and rail accident investigations in 2003-04.

Table 4.8 - Trends in other aspects of transport safety investigation

a Until 1 July 2003, investigations were a state responsibility and the ATSB was involved at the request of state governments. Median completion times for these investigations are not reported due to the time required for state governments to consider reports before their release. Completion time estimates for rail investigations under the ATSB's new powers cannot be reported as none were completed in 2003-04.
b This count includes the Chiltern rail investigation report submitted to the Victorian Government in late 2003-04. This report is expected to be released to the public in late 2004.
c This includes the direct costs of aviation, maritime and rail investigations, as well as indirect costs such as corporate overheads.

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Output 1.4: Transport programmes

(Programmes Group, Regulatory Group, Policy and Research Group)

Description	Performance indicators	Progress
The department facilitates major transport infrastructure investment that serves the national interest and promotes a strong economy nationally and within regions by: administering transport initiatives that are nationally focused, safe, efficient, competitive and environmentally responsible managing ongoing road, rail, aviation, maritime and industry programmes collecting general taxes, levies, fees and loan repayments, both departmental in nature and on behalf of the Commonwealth.	Effectiveness: transport, logistics and infrastructure programmes contribute to increased safety, security, competitiveness, accessibility and sustainability of transport and logistics systems administration of programmes is in accordance with legislation, government policy and departmental standards stakeholder interests are considered in programme administration revenue collected and reported in accordance with legislation. Price: $11.9m (up from $11.0m at Budget)

Report on performance

We administer a range of grants, subsidies and other payments on behalf of the Australian Government. In 2003-04 we administered more than twenty transport programmes. These programmes:

• improved security and quarantine facilities at airports at a cost of $39.3 million
• invested $1.3 billion in land transport planning, projects and infrastructure of national importance such as National Highways, Roads of National Importance, Black Spot and Federation Fund projects
• reduced the cost of regional air, shipping and related support services to consumers by $133.3 million, and
• funded works to reduce aircraft noise and address other transport externalities at a cost of $17.9 million.

We also collect a range of taxation and non-taxation revenues on behalf of the Australian Government. In 2003-04 we collected less revenue than in previous years due to the government decision to cease the Air Passenger Ticket Levy (see case study).

In 2004-05 we will implement the government's new approach to land transport - AusLink. As discussed in Chapter 1 , the new AusLink programme will fundamentally transform the way we fund land transport in Australia. Amongst other things, it will replace the former National Highway and Roads of National Importance programme and focus on projects within a defined network of key corridors.

While we will continue to fund many projects fully, particularly on the former National Highway system, we will place much more emphasis on shared responsibility and funding of projects with other levels of government and the private sector, so as to increase the return on every dollar spent by the Australian Government. Figure 4A below illustrates the new AusLink model of transport investment.

Figure 4A - The new AusLink model of transport investment

We aim to deliver our outputs at an agreed price, but review our budget throughout the year in light of changing priorities and actual results. Our final result for 2003-04, $11.5 million, was less than in previous years but is likely to rise in 2004-05 as we gear up to implement AusLink.

Table 4.9 - Trends in transport programmes

Administered programme - Aviation security enhancements - regional airport security (Regulatory Group)
Description	Performance indicators 4	Progress
This programme enables 140 regional airports to undertake security risk assessments and related works.	Effectiveness: improved security at 140 regional airports Cost: $35.0m

After finalising the 2003-04 Budget, the Australian Government decided to provide grants to help regional airports upgrade their security at a cost of $14.0 million over two years from 2004-05. This measure was described in our 2003-04 Portfolio Additional Estimates Statements.

The government later reviewed the programme in light of wider aviation security issues and the ability of regional aviation operators to match government funds. It agreed to bring the programme forward to 2003-04 and to increase its budget to $35.0 million. This change was described in our 2003-04 Portfolio Supplementary Additional Estimates Statements.

Regional airports can now access funds to install basic security infrastructure such as fencing, lighting and alarms/surveillance systems to improve security.

We expect regional aviation security will continue to improve over 2004-05, as a related programme starts up. This programme will pay for hardened cockpit doors to be installed on existing regional passenger aircraft with 30 or more seats, and will cost $3.2 million.

4 Performance indicators for this programme have not been published before due to the timing of its introduction. The indicators shown here are consistent with those used for related programmes e.g. aviation security enhancements to regional passenger aircraft in 2004-05.

Administered programme - Australia's response to foot and mouth disease and other quarantine risks - Airports Quarantine Infrastructure programme (Programmes Group)
Description	Performance Indicators	Progress
This programme funds works to enable more passengers and bags to be screened for quarantine risks such as foot and mouth disease as they arrive in Australia.	Effectiveness: improved international airport infrastructure facilities, increased quarantine intervention rates Location: Melbourne Airport Cost: $6.0m (down from $7.76m at Budget)

Following a major outbreak of foot and mouth disease in the UK in early 2001, the government announced a range of measures to strengthen Australia's quarantine borders against exotic pests and diseases.

In previous years, this programme funded new and improved infrastructure at Sydney, Perth, Adelaide, Darwin and Cairns international airports, to enable Customs and AQIS to screen and inspect a much larger amounts of passenger luggage. Together with other measures, it has contributed to increased quarantine intervention rates. Intervention rates currently average around 81 per cent, up from approximately 25 per cent in early 2001.

Works at Melbourne Airport could not be completed in 2003-04 due to unforeseen delays in other important upgrades being carried out at the airport. We now expect to complete construction of queuing and staff facilities in 2004-05.

Table 4.10 - Trends in land transport programmes