Transport Outputs and Programmes

Australia's transport safety investigation regime is set out in the Transport Safety Investigation Act 2003. The Act empowers the Australian Transport Safety Bureau (ATSB) to:

• investigate safety incidents and accidents involving civil aviation, shipping and the defined interstate rail network
• have primacy in investigation unless there is a clear case of unlawful interference such as terrorism, and
• conduct 'no blame' investigations where the focus is on learning to improve future safety rather than on criminal or civil liability.

Aviation investigation regime 'highly satisfactory'

The International Civil Aviation Organization (ICAO) is the United Nations (UN) body that sets international standards for civil aviation. In May/June 2004 ICAO conducted an audit, at the ATSB's request, of Australia's transport safety investigation regime.

The audit provided an opportunity to establish Australia's level of compliance with its international obligations under Annex 13 to the ICAO treaty, and to assess our performance against international best practice. In its October 2004 report, ICAO:

• commended the positive and professional approach we took in proactively seeking the audit, as well as our very comprehensive training policy and programme
• was 'highly satisfied' with the legislative and organisational framework set up by Australia and the ATSB
• reviewed sample investigations in depth, reporting that 'despite multiple difficult circumstances in each of the investigations reviewed, the investigators appeared to have managed the investigation tasks in a professional and efficient manner', and
• found that 'safety issues were properly addressed and the processing of reports of the investigations was generally accomplished in a timely manner'.

As expected, ICAO recommended changes to some processes and documentation. We have formally responded to all ICAO recommendations and ICAO's report rates our proposed response as 'fully acceptable'.

For a copy of ICAO's report, visit http://www.atsb.gov.au/publications/2004/icao_audit.aspx

Helping re-write the book on major accident investigation

Australia is one of only six countries that ICAO has invited to help rewrite its major accident manual - the Manual of Aircraft Accident and Incident Investigation. The manual is being updated in stages and the ATSB is contributing to updates of the various modules as required.

Setting new standards for rail and maritime investigation

Australia has also made significant progress in standards for rail and maritime investigations. We are:

• among only a few countries in the world to investigate rail safety accidents on a national basis
• helping redraft the International Maritime Organization (IMO) Code for the Investigation of Marine Casualties and Incidents, and
• co-sponsors with Canada and Vanuatu of a proposal that the revised IMO code be made mandatory under the provisions of the Safety of Life at Sea Convention 1974.

Our maritime and rail investigation teams are also implementing, where relevant, recommendations arising from the ICAO audit of civil aviation safety investigation.

Industry and regulators taking safety action earlier

Safety regulators, manufacturers and operators are encouraged to take steps to improve safety as investigations progress, and prefer to report positive action taken rather than making formal recommendations.

This approach saw fewer recommendations issued in 2004-05 than in previous years, particularly in aviation where we only issued 21 recommendations compared to 62 in 2002-03.

Aviation safety messages well accepted

In 2004-05 the ATSB instigated and released reports on around 30 per cent more investigations than in 2003-04, reflecting a boost in funding for aviation safety investigation. High profile reports released in 2004-05 included reports on:

• a fatal Cessna C404 accident at Jandakot Airport WA
• a fatal emergency medical services (EMS) helicopter accident near Mackay Qld, and
• the Boeing 737 terrain proximity warning incident near Canberra.

Aviation safety messages continued to be well accepted, with operators, manufacturers and regulators undertaking significant safety actions in cooperation with our investigations.

For example, following ATSB's investigation into the EMS helicopter accident, the Queensland Emergency Services Department is improving standards and support for community helicopter providers, and all pilots will be required to train to the Command Instrument Rating standard.

A key priority for 2005-06 is to implement the second stage of a new aviation investigation IT system - the Safety Investigation Information Management System (SIIMS). This will enhance our ability to assess the more than 8000 reports of aviation events we receive every year.

Marine investigations lead to regulatory changes

In 2004-05 the ATSB completed 11 maritime investigations. High profile reports released in 2004-05 included reports on:

• a lifeboat accident aboard the Lowlands Grace in Port Hedland last year, and
• the breakdown of the Maersk Tacoma in Bass Strait following a bearing failure.

Both these investigations have led to safety actions: the Australian Maritime Safety Authority has expanded their port state control investigations to include lifeboats; and ship owners and operators are now required to promptly notify local rescue coordination centres if their ship becomes disabled.

Safety messages have, however, been slow getting through to the commercial fishing industry. Since 1990 we have investigated 23 collisions between fishing boats and much larger cargo vessels, with two recent collisions resulting in the sinking of the fishing boat and the death of its skipper. We have now initiated measures to raise awareness in the industry (see Transport Safety page 42 ).

Rail safety investigations make valuable recommendations

We released three rail safety reports in 2004-05. These covered the Chiltern train derailment in Victoria and subsequent collision between a passenger and freight train, and derailments at Ararat in Victoria and Bates in SA. These reports have led to a number of new safety measures being introduced:

• The Victorian Department of Infrastructure has expanded its audit programme to include wheel bearing maintenance and communications between train control centres.
• Rail freight operator Pacific National has implemented new distance-and-time based maintenance schedules, and mandated inspections of rolling stock entering service after extended periods, including wheel bearing lubrication tests.
• The Australian Rail Track Corporation is reviewing procedures associated with tamping and the monitoring and inspection of correct track prestressing.

Work continued on the joint Queensland Transport investigation into the Cairns tilt train accident which occurred north of Bundaberg in November 2004. A preliminary report on this accident was released by the Queensland Minister for Transport in February 2005, and the final report in October 2005.

Drawing on an enhanced IT capacity for aviation investigations, a national database of rail accidents and incidents is being developed in cooperation with rail regulators in the states and territories. The database will serve as a valuable resource to industry, regulators, investigators and researchers.

Best turnaround times yet for aviation and marine

In 2004-05 our median report completion time for aviation investigations fell to 247 days, down from 330 last year. This result reflects the injection of increased resources announced in the 2004-05 Budget.

The median report completion time for marine investigations was 372 days, slightly above the targeted 365 days but a substantial improvement on the previous year's result of 484 days.

For the first two rail reports under the Transport Safety Investigation Act 2003, a completion time of 519 days was well above our target of 365 days, but this is expected to improve as investigators in our relatively new rail unit become more experienced.

High level of response readiness maintained

In 2004-05 we continued to maintain a high response capability against the possibility of a major transport safety accident in Australia.

Sadly, our response capabilities were put to the test following Australia's worst commercial air crash in 35 years - the Lockhart River crash - in which 15 people died. We were able to mobilise rapidly and operate effectively in remote and difficult terrain (see case study page 36 ).

A major desktop aviation accident exercise will be held next year in line with the Australian Government's new aviation disaster response plan (CAVDISPLAN).

In 2004-05 we released 112 reports, up from 82 last year. This included 98 aviation reports, up 30 per cent from last year due to additional resourcing for this function. The aviation result was partially offset by a drop in the number of maritime reports released (11). Three rail reports were also released.

Next year we plan to complete around 100 aviation, 10 marine and 10 rail investigations, including reports on fatal accidents at Benalla and Lockhart River and on the tilt train accident.

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Within the department, the ATSB publishes safety reports and papers based on its research activities and accident investigations for the information of governments, industry and the wider community. The department also promotes ways to make travel safer and makes sure vehicles entering Australia meet safety standards.

Road deaths in 2004 the lowest since 1949

Australia recorded 1589 road deaths during 2004 - the lowest level in more than 50 years. This reflects a continuing downward trend in road deaths since the introduction of the National Road Safety Strategy on 1 January 2001.

The result translates to 7.8 deaths per 100 000 population, a 17.4 per cent reduction from the 2000 rate. However, with a target of no more than 5.6 deaths per 100 000 people by 2010 (see figure 3A), the government is continuing to introduce new initiatives, such as a driver education scheme for P-platers (page 43).

Aviation safety improving

Over the 10 years from 1 July 1995, accidents and serious incidents have dropped from 240 to 153, and fatal accidents have more than halved from 24 to 11 (see figure 3B). However there in never room for complacency as demonstrated by the 15 fatalities in one accident at Lockhart River in 2004-05.

Commercial fishing in the safety spotlight

In 2004-05, the ATSB initiated a proactive safety awareness programme aimed at the Australian commercial fishing industry. The programme is based around a series of face to face meetings with the fishing industry peak bodies, state marine regulators and fishers to outline the recurring factors we find in our investigations.

A new safety bulletin was prepared for the meetings along with a selection of other safety materials including a DVD produced in conjunction with the Australian Maritime Safety Authority and marine regulatory authorities in Queensland and NSW.

Nationally consistent rail safety regulations on the way

Investigations into a number of rail accidents - most notably the NSW Waterfall train crash which killed seven people in January 2003 - have highlighted the need for a more proactive approach to assessing and monitoring the health of key rail workers.

In 2004-05 the department continued to work with all states, the NT and the rail industry on developing a new national standard, through a process facilitated by the National Transport Commission. The outcome of this process-model legislation to deliver a nationally consistent approach-is to be considered by the Australian Transport (Ministers) Council in November 2005.

The ATSB supports other agencies, governments and industry to evaluate and improve transport safety interventions and outcomes by:

• releasing statistical and research publications (see Quantity page 47 )
• coordinating national road safety action plans under the National Road Safety Strategy 2001-2010, and
• piloting safety education programmes (see driver education).

National Road Safety Action plan 2005 and 2006 launched

The third action plan under the National Road Safety Strategy 2001-10 was developed jointly with state and territory governments with input from a broad range of organisations through the National Road Safety Strategy Panel.

It highlights three key priority areas for policy makers and planners to focus on in 2005 and 2006 - safer roads and roadsides (infrastructure), safer speeds and safer vehicles.

The new plan will contribute significantly to the goal of the National Road Safety Strategy - saving 3600 lives by reducing yearly road fatalities by 40 per cent per 100 000 people over the decade to 2010.

National driver education trial being established

We responded to the Australian Government's policy initiative to facilitate the introduction of a national compulsory driver education scheme. The scheme is expected to apply to all new provisional licence holders (Pplaters).

In 2004-05 we began the task of putting together the basic course curriculum, in partnership with Australian and international experts. The aim was to develop an innovative programme built on international best practice and 'drawing on insight' learning processes that have shown promise in overseas trials. This approach focuses on raising awareness of driver risk factors and providing inexperienced drivers with an appreciation of their own limitations.

Following the publication of our initial work in December 2004, former Transport Minister Anderson convened a national forum on young driver safety (at Parliament House), where he announced the next stage of the project-a 12-month trial of the course in partnership with the NSW and Victorian Governments, as well as the Federal Chamber of Automotive Industries, the Insurance Australia Group and the Royal Automobile Club of Victoria.

Starting in 2006, about 7000 P-platers in each state will go through the course. A control group in each state will be made up of a similar number of P-platers. All trial participants will be monitored for at least a year after completion of the trial, and independent experts will be commissioned to undertake a comprehensive evaluation.

The total cost of the trial, including evaluation, is expected to be about
$10 million. The Australian Government has contributed $3 million.

New vehicle safety standards taking shape

Before any road vehicle can be supplied to the market in Australia, it must comply with the Motor Vehicle Standards Act 1989 (MVS Act). 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).

The department is progressively reviewing the ADRs to harmonise them, where possible, with international standards developed under the United Nations Economic Commission for Europe (UNECE) framework.

Harmonising will remove trade barriers and allow vehicles manufactured for world markets to be supplied to Australia without the need for extensive modifications. It will lead to lower costs and to better access to safer, more environmentally friendly vehicles.

As part of this process, in 2004-05 we:

• gazetted changes to ADR 18/03 relating to speedometers, to harmonise with the UNECE regulation
• completed consultation on and recommended the repeal of ADR 17/00 on fuel systems - this uniquely Australian standard was repealed on 1 August 2005 meaning that importers no longer needed to replace fuel tanks
• completed consultation on regulation impact statements to harmonise door, seat, seatbelt, safety glazing and rear mirror standards with the corresponding UNECE regulations (ADRs 2, 3, 4, 8/01 and 14)
• released regulation impact statements for public comment on heavy vehicle standards so that UNECE compliant vehicles require only minor modification¹ (ADRs 35/01, 38/02 and 62/01)
• released a regulation impact statement on audible seatbelt reminder systems for cars
• drafted two statements relating to heavy vehicles to harmonise with UNECE regulations-one for a new ADR for underrun barriers the other relating to speed limiting (ADR 65/00), and
• drafted a statement relating to occupant protection in buses (ADR 68/00).

In 2005-06, we will implement the 1958 UNECE harmonisation agreement governing approvals and certification of automotive products, to enhance export opportunities for Australian manufacturers. The government will also consider the 1998 agreement, which offers even greater scope for global harmonisation as its membership includes the USA and Canada, neither of whom are signatories to the 1958 agreement.

Vehicle and workshop processes getting quicker

Manufacturers and importers must demonstrate that their vehicle types meet ADRs before they can be supplied to the Australian market.

Special compliance arrangements apply for manufacturers and importers who supply limited numbers of new vehicles to the mainstream market and used vehicles to the specialist and enthusiast market. We assess whether a vehicle is a specialist or enthusiast model under the Specialist and Enthusiast Vehicle Scheme (SEVS).

Only vehicles approved under SEVS can be supplied to the market under the low volume scheme (new vehicles) or Registered Automotive Workshop Scheme (RAWS) (used imported vehicles).

As a result of additional funding announced in the 2004-05 Budget, the department achieved substantial improvements in timeliness for vehicle and workshop approval processes. We:

• achieved 93 per cent of approvals to import vehicle types within our target of 17 working days
• completed approximately 80 per cent of RAWS inspections within the target of six weeks, down from an 18 week turnaround time in February 2004
• raised around 95 per cent of post-inspection discussion items electronically within the target of one week of inspecting officers returning to the office, and
• examined approximately 80 per cent of evidence submitted for assessment within 20 working days.

We are working to improve timeliness further in 2005-06-to complete at least 85 per cent of all vehicle and workshop processes within target timeframes.

Demand increases for vehicle and workshop approvals

In 2004-05 the department approved 64 RAWS workshops and conducted more than 160 inspections to address the backlog of approvals associated with the establishment of the scheme². In 2005-06 we expect to conduct around 155 inspections, including inspections for new approvals, inspections for approval to handle additional vehicle models and audit activities.

Forty-one research publications released

In 2004-05 the number of statistical and research publications released was 41 in all, comprising 9 aviation and 32 road.

The ATSB released and published on its website seven road safety research reports including reports on road texture and crash risk and community attitudes, as well as 25 road safety and rail statistics publications, including 13 road fatality statistical reports. The other 12 special-issue statistical reports included:

• Deaths and serious injuries among female motorcyclists, in which trends in crash rates among female as well as male motorcyclists are analysed
• Fatal road crashes involving articulated trucks in which it is shown that crash rates in this sector during the last decade have plateaued despite the increase in the sector size, and
• Cycle safety: a national perspective which presents data on trauma due to road crashes involving cyclists.

In 2005-06 the ATSB will continue to research transport safety issues, including motor vehicle side impact protection, pedestrian and vehicle compatibility, the role of human error in road crashes and truck safety.

The actual price of this output in 2004-05 was $18.4 million.

Costs to industry reduced

Under the MVS Act, the costs of regulatory and compliance services provided are recovered through industry fees.

In 2004-05 the government annouced a reduction in the fees paid by the mainstream vehicle industry to address a potential for ongoing over-recovery of revenue against the cost of related regulatory activity. These arrangements are subject to a follow-up review in two years.

Australia's response to terrorism relies on strong cooperation between governments, government departments and agencies and industry. The Australian Government leads work to improve the security of Australia's transport system and reduce the likelihood of transport being a target of, or vehicle for, terrorism.

In 2004-05 a new capability to investigate major security incidents was established within the department. In addition, the department

• continued to advise the government on how best to manage security risks in light of world events and international practice
• implemented new legislation to enhance Australia's maritime and aviation security regime, and
• worked with industry to learn from and enhance its risk readiness, including through the $48 million Securing our Regional Skies package (pages 58-60)

A new intergovernmental agreement on surface transport security was endorsed by the Council of Australian Governments (COAG), and work continued with targeted countries in our region to improve their transport security capabilities.

New capability for security investigation established

No major transport security incidents were reported in Australia in 2004-05. However, in light of ongoing international events, the government established a new capability for security investigation within our department - the Office of the Inspector of Transport Security.

The new office, launched in November 2004, is headed by former federal police commissioner Mr Mick Palmer AO. As Inspector of Transport Security, Mr Palmer will investigate:

• aviation and maritime security incidents as directed by the minister, and
• major land transport security incidents as directed by the minister and subject to agreement from the relevant state or territory government.

Proactive as well as reactive investigations are planned. These might include reviews of industry security systems, practices and procedures. All investigations will be done independently from the Office of Transport Security (OTS).

Draft legislation is being finalised to enable Mr Palmer to conduct investigations into major incidents on the same 'no blame' basis consistent with the approach applied in relation to transport safety investigations.

Pending the passage of the legislation, Mr Palmer has supported the Wheeler review of aviation security and policing, which reported to government in September 2005 (see Stop press).

Threat environment ever changing

While there was no change to Australia's national alert level - it remained on medium - international events like the Madrid, Jakarta and London terrorist attacks provided new information and are important reminders of the need to continually review security measures.

In 2004-05, acting on advice from the department and in line with international practice, the Australian Government:

• increased the number of regulated airports from 40 to 185 and regulated airlines from 60 to 170
• applied more stringent and visible measures at Australian airports and ports, including enhanced access controls to airport secure areas
• strengthened the criteria for background checks on workers holding aviation security identification cards
• following consultation with industry, introduced security identification cards for people working in maritime security zones
• strengthened relationships with key agencies in Canada, New Zealand, the UK and the USA to facilitate better enforcement of the International Ship and Port Security Code, and
• enacted legislation to bring Australia's 56 offshore oil and gas platforms - which deliver around $18 billion a year in export and trade revenue - into the maritime security regime.

Briefings were arranged for industry and other governments to enable them to make more informed decisions about their security in response to various world events including the London terrorist attacks of 7 and 21 July 2005.

As mentioned in Chapter 2, the government announced a major review of security and policing at Australian airports in June 2005. The department established a review secretariat and supported the inquiry until its completion in September. The government has now announced a number of new security measures (see Stop press).

Aviation and maritime security laws tightened

Aviation and maritime security are regulated through the Aviation Transport Security Act 2004, and Maritime Transport and Offshore Facilities Security Act 2003. These Acts require bodies based in air and sea ports and related facilities to:

• conduct regular security risk assessments
• develop security plans based on that assessment
• implement appropriate security measures including security zones and signage, and
• ensure all staff working in security zones hold an appropriate security identification card.

Similar requirements apply to airlines operating in Australia - who must also contact our security operations centre for curfew dispensations at four airports and permits required under the Air Navigation Act 1920 (page 100) - and to Australian flagged shipping.

Special arrangements apply to operators of general aviation aircraft - while there is no requirement to develop a full security plan, operators must implement
anti-theft devices when their aircraft are unattended.

Special arrangements also apply to foreign flagged vessels operating in Australian waters. These vessels are required to:

• maintain appropriate international ship security certificates
• notify us of their movements, and to
• contact our operations centre for approval to engage in coastal trade under the Navigation Act 1912 (page 74).

All bodies are required to notify us as soon as practical of any unlawful interference to their operations. We maintain a 24-hour operations centre to facilitate prompt action on notifications and other processes.

Regulated bodies 100 per cent compliant

As a result of changes to the aviation and maritime transport security legislation in 2003-04, more than 650 bodies were required to put in place formal security programmes for the first time in 2004-05.

Major airlines and airports continued to implement longstanding security arrangements consistent with security plans. Another 255 airports and airlines submitted plans to us for the first time in 2004-05 and over 600 cargo agents introduced new measures for domestic air cargo. The vast majority were of a high standard and all have now been approved. Likewise, audit activity confirms that general aviation operators are generally complying with the requirement to secure unattended aircraft against theft.

In the maritime industry, all bodies had submitted security plans to the department as required by 30 June 2004. New entrants or amendments to existing plans saw another 82 plans submitted to us in 2004-05. The vast majority of these were of a high standard and have been approved. Five were withdrawn or did not proceed and twelve are still under assessment.

In anticipation of the need to establish relationships with the growing number of bodies we regulate, the department appointed and trained more transport security inspectors in 2004-05. As at 30 June 2005, more than 60 transport security inspectors are based in offices across Australia. These inspectors:

• audited 69 per cent of airlines and 18 per cent of airports, and
• audited 17 per cent of maritime security plans, with 100 per cent of Australian flagged vessels subject to audit over the last two years, and
• made many more security related visits including partial inspections and attendance at security meetings and exercises.

All regulated bodies were assessed as being fully compliant with relevant security requirements at 30 June 2005.

Foreign flagged vessels subject of close scrutiny

Since 1 July 2004, every foreign flagged ship seeking entry to Australia has been subject to risk assessment to enable inspections to be prioritised. Many of these ships are also subject to a hands-on security inspection. In 2004-05 the department:

• risk assessed and monitored the activities of every foreign-flagged ship entering Australian waters
• issued six foreign flagged vessels with control directions for a failure to hold valid security certificates - these ships will not be permitted to re-enter Australia until they have a valid certificate
• authorised officers of the Australian Maritime Safety Authority to conduct first-line inspections in conjunction with their port state control function, and
• undertook some 153 detailed ship inspections - an average of three ships a week.

Operations centre now operating 24/7

On 1 July 2004 the OTS Operations Centre, established in 2003-04, moved to around the clock operations - 24 hours a day, 7 days a week. In addition to supporting all of the above enforcement and compliance activity, it:

• received more than 12 328 calls about possible aviation and maritime security incidents
• coordinated the department's response to a range of events including the Boxing Day tsunami (see Chapter 2 page 24 ), and
• authorised the transportation by air of persons in custody, mainly arising from immigration and illegal fishing offences.

• international^a

• domestic

• international

• domestic

Work continues to enhance industry risk readiness

In 2004-05 the department continued to work with the aviation and maritime industries to reduce the risk of acts of terrorism. We:

• developed a best practice model to provide industry with briefings on nationally classified assessments of the terrorist threat, in conjunction with ASIO
• developed and distributed declassified risk context statements to industry to inform transport security planning
• developed guidance material on better practice and ran workshops around Australia to help operators conduct security risk assessments and prepare security programmes
• delivered funding to enable hardened cockpit doors to be installed in aircraft used on regional routes (page 59)
• put in place arrangements to deliver metal detector kits and training to regional airports over 2005-06 (page 58), and
• started a trial of closed-circuit television as an aid to security at four regional airports (page 60).

Surface transport

While surface transport security is the responsibility of the state or territory in which the service is located, the Australian Government works with other governments to develop a consistent and coordinated approach.

In 2004-05 the department continued to provide secretariat support to the Transport Security Working Group as the main forum for progressing transport security issues. The group, set up in 2003, comprises senior transport officials from each state and territory and reports through the chief executive officers of transport departments to all transport ministers (the Australian Transport Council). In 2004-05 the group:

• developed and coordinated the signing of an intergovernmental agreement on surface transport security
• implemented key recommendations agreed by the Australian Transport Council and Overseas Mission on Transport Security following the Madrid terrorist attacks, and
• supported state and territory governments to progress priorities identified in the National Transport Security Strategy we developed in 2003-04 and to participate in a national counter-terrorism exercise program.

The department also:

• hosted a national forum on mass passenger surface transport security in June 2005 - this was attended by over 140 Australian and New Zealand delegates including owners and operators, government transport officials and police.
• participated in emergency meetings in the days immediately following the London terrorist attacks of 7 and 21 July 2005 - to review Australia's surface transport security arrangements, and
• accompanied Australian police to the UK following the attacks, to report back on protective security and planning implications especially for mass urban transit.

Overseas presence and projects expanded

In 2004-05 the department continued to work with targeted countries in the Asia-Pacific region to improve both aviation and maritime security. We:

• established transport security liaison officers in South East Asia, working out of the Australian missions in Jakarta and Manila (see case study)
• worked with the Singaporean government through APEC to provide maritime security training to countries in the region,
• participated in audits of aviation and maritime security in Fiji and Nauru under the Australian Government's Pacific Governance Support Programme, and
• placed security advisors in Papua New Guinea (PNG) to assist local authorities to improve compliance with international aviation and maritime security standards, under the Enhanced Cooperation Programme with PNG.

In 2005-06 we expect to expand our overseas presence, with three officers based in Jakarta, two in Manila and two Pacific liaison officers.

Securing our Regional Skies package was announced in August 2004 to improve the response capacity, capability building and deterence for Australia's regional airports and airlines.

As part of the Securing our Regional Skies package, the regional passenger screening programme is meeting the cost of hand wand metal detecting kits and staff training at 140 regional airports that handle regular public transport services.

This will enable airport operators to scan passengers and hand luggage at short notice - for example, if the government announces a change in the alert level.

While airports are only required to scan passengers and hand luggage when specified by the government, we encourage routine use of these procedures to allow staff to practice their skills and assure the local community of their airport's commitment to aviation security.

In 2004-05 we completed an open tender process and awarded contracts to support equipment as well as training for up to 10 people at 140 airports across Australia.

Training will start in early September 2005, initially in regional NSW with a roll out across Australia to follow. All training is expected to be completed towards the end of 2006.

As at 30 June 2005, hardened cockpit doors had been installed in 74 aircraft serving regional Australia.

The installation of hardened cockpit doors in another eight aircraft was delayed because of global demand for these types of doors and the technical limitations for some aircraft types. Operators of these aircraft have put in place additional security measures, pending installation of the doors in 2005-06.

As part of the Securing our Regional Skies package, this programme will supply and install CCTV in four regional airports to evaluate its value as an aid to security.

As at 30 June 2005 we had selected four regional airports to participate in the trial-Dubbo in NSW, Geraldton in WA, Gladstone in Queensland, and Moorabbin in Victoria-based on their diverse locations and risk profiles.

We also completed an open tender process, awarded contracts and approved plans for equipment to be installed at all four airports.

The cameras will provide 24 hour surveillance of all key aspects of each airport's operations and must be used in line with relevant privacy legislation in each state. To support responses to any activity of interest or concern, surveillance feed will be made available to:

• local police
• airport management and
• the Office of Transport Security Operations Centre

After cameras have been in place for 12 months, we will assess the research data and make a recommendation concerning the most effective use of CCTV at regional airports.

AusLink White Paper turning into concrete, steel and bitumen

Last year the Australian Government launched Australia's first national land transport infrastructure plan - the $12.7 billion, five-year AusLink plan.

In 2004-05, the first full year of the plan, the department administered a total of $1.7 billion in funding for national infrastructure on behalf of the Australian Government. We:

• distributed $1.3 billion for more than 160 major projects including the Westlink M7 (see case study page 15 ), Melbourne's Craigieburn bypass and the upgrade of the Pacific Highway
• contributed more than $300 million to over 2000 smaller Roads to Recovery and Black Spot projects to ensure local needs received attention, and
• worked with the Australian Rail Track Corporation (ARTC), which is wholly owned by the Australian Government, on its five-year $1.4 billion programme of works on the key Melbourne-Sydney-Brisbane rail line and Hunter Valley corridors¹.

As well as improving national infrastructure, AusLink is stimulating economic growth by making it easier for commuters and freight operators to move around Australia and delivering long term benefits through a safer, less congested land transport system.

The proposed works by the ARTC, for example, will significantly reduce the travel time for trains on the Melbourne, Sydney, Brisbane corridor, with estimated time savings of over:

• 2 hours Melbourne to Sydney
• 4 hours Sydney to Brisbane, and
• 9 hours Melbourne to Brisbane.

For up-to-date information about AusLink including maps of funded projects, visit the AusLink website www.auslink.gov.au

AusLink already transforming how we plan and invest

One of the government's top priorities in 2004-05 was the passage of the AusLink (National Land Transport) Act 2005, which was proclaimed on 28 July 2005. The Act:

• takes the place of the Australian Land Transport Development Act 1988 and expiring legislation including the Roads to Recovery Act 2000, and
• brings six separate administered and supporting programmes into a single legal framework.

The department started negotiating bilateral agreements with states and territories to clarify respective responsibilities for a new national network that incorporates rail and is more extensive than the former national highways system (page 65).

In 2004-05 the department administered the following programmes:

• the AusLink National Network (page 64)
• the AusLink - Roads to Recovery programme (page 66)
• the AusLink - Road Safety Black Spot (page 68) , and
• various legacy programmes (page 70) .

For more information about how these programmes were administered, please see the relevant programme reports below.

New national network

The AusLink National Network comprises 24 transport corridors in all. It takes in Australia's major roads and railways, as well as freight terminals at our major sea and air ports.

In 2004-05 the Australian Government invested $1.3 billion in projects, a number of which were jointly funded by relevant state and territory governments and other parties. Work was completed on:

• the first section of the Craigieburn bypass, Victoria ($306m)
• the 9.8km Karuah bypass on the Pacific Highway in NSW ($123m)
• the Great Western Highway upgrade, NSW ($100m)
• widening of the F3 to six lanes between the Hawkesbury River and Mt White, NSW ($80m)
• Johnson Creek and Nowranie Creek bridge upgrades along the Barkley Highway, north Queensland ($24.2m and $24.1m)
• the first five kilometre section of the Port River Expressway, SA ($39.7m)
• the upgrade of Summerland Way, north eastern NSW ($20m), and
• four new bridges on the Great Northern Highway in the Kimberley region, WA ($13.5m).

Many other projects underway

Work also continued on many other projects, including

• four major projects on the Pacific Highway to provide an extra 36.8 km of dual carriageway
• extension of the rail line at Fremantle Port to the North Quay container terminals, and construction of a new rail terminal, and
• ARTC work to develop the next generation of train control technology-satellite-based technology which can track trains to within half a metre of where they are and alert drivers to impending dangers.

In May 2005, work also started on a $524 million Albury-Wodonga project to build a new four lane crossing on the Murray River and connect the Hume Freeway with the Murray Valley Highway. The new freeway, expected to open in mid-2007, will bypass 17 sets of traffic lights, remove trucks from residential streets in south Albury, eliminate six rail level crossings and also provide road and pedestrian crossings to link the community.

Bilateral agreements with states and territories negotiated

To enable AusLink to proceed on a strong footing, the government is negotiating bilateral agreements with all states and territories. These agreements establish new partnership arrangements with the states and territories which include:

• sharing the costs of some projects
• improving long term planning to meet and manage future transport demands, and
• making better decisions about proposed investments.

As at 30 June 2005, bilateral agreements had been signed with Victoria and SA. Negotiations were well advanced with NSW, WA, Queensland, and the NT, and underway with Tasmania and the ACT.

AusLink - where to next

AusLink is a five-year funding plan with a twenty-year planning horizon. This means that, while we are only one year into the first fiveyear plan (2004-09), planning has already started for the next stage of AusLink.

Long-term corridor strategies are being developed to inform future investment by the Australian Government and help develop the next five-year National Land Transport Plan (2009-14). While corridor planning is not new to most states and territories, the AusLink approach offers enhanced benefits as it will:

• be focused on a whole corridor e.g. Perth to Adelaide, not just sections within individual jurisdictions such as WA or SA
• be multi-modal rather than focused on a single mode of transport (road or rail), and
• establish agreed objectives and performance measures for each corridor.

In 2004-05 the department started work with state and territory counterparts on four pilot studies to inform how we will approach studies for all the remaining corridors. The pilots cover the road and rail corridors, including port and intermodal connections, from Sydney to Melbourne, Perth to Adelaide, Brisbane to Cairns, and around urban Adelaide.
We expect to complete these pilot studies in 2005-06 and start at least another eight corridor studies as well as a north-south rail corridor study. All corridor studies are to be completed by mid-2007.

In 2004-05 this programme was administered under the Australian Land Transport Development Act 1988. The Act remains in force for projects which were approved but not yet completed under the former Roads of National Importance Programme and which do not form part of the national network.

New projects are now being administered under Parts 2 through 5 of the AusLink (National Land Transport) Act 2005 as proclaimed on 28 July 2005.

Local councils nominate the projects to be funded. Funding can be used for a range of purposes, including road works, traffic lights and signs, street lights, ferries, bridges, tunnels and bike paths, but not moveable capital equipment items such as graders and other plant.

Councils have so far used the money to undertake about 15 000 road projects, including 2300 new projects in 2004-05. Of the projects allocated funding over the life of this programme:

• almost 34 per cent involved reconstruction, rehabilitation and widening of local roads
• 14.3 per cent involved sheeting and re-sheeting gravel roads with a new surface
• 11.6 per cent involved sealing along sections of gravel roads, and
• 10.1 per cent involved bridge or drainage works, with about 700 bridges replaced or repaired.

Councils must lodge audited financial statements confirming how they spent programme funds as well as an annual assessment of the works undertaken against desired outcomes. All councils met this requirement during 2004-05.

The Australian Government has decided to extend the programme until June 2009.

The programme was administered until 30 June 2005 under the Roads to Recovery Act 2000. This Act remains in force only insofar as it requires councils to meet various obligations, such as the requirement to acquit funds received.

Administration of the programme under the old Act is the subject of a current audit by the Australian National Audit Office. The audit report is scheduled for tabling in parliament in February 2006.

Since 1 July 2005, new projects have been funded under Part 8 of the AusLink (National Land Transport) Act 2005.

Every council in Australia is guaranteed a share of Roads to Recovery funding. In 2004-05 we distributed funding to approximately 500 councils - 222 councils had already received the maximum funds available to them under the old Act.

Funding is also provided for roads in unincorporated areas, that is, places where there are no councils. In 2004-05 $3.2 million went towards these areas in NSW, Victoria, SA, the NT and the Indian Ocean Territories (IOTs).

In 2004-05 this programme cost $253.1 million, bringing to $1.2 billion the amount spent on this programme since January 2001.

As confirmed in the 2005-06 Budget, a further $1.35 billion will be spent on the new Roads to Recovery Programme over the four years from 2005-06. This comprises:

• $1.2 billion for local councils, to be allocated in accordance with the recommendations of state/NT local government grants commissions
  ($300 million in 2005-06)
• $30 million for unincorporated areas of NSW, Victoria, SA, the NT and IOTs ($7.5 million in 2005-06), and
• $120 million for strategic regional projects to be identified through a competitive process ($40.6 million in 2005-06).

More than $90 million of the total $120 million available for strategic regional projects and unincorporated areas has been committed to priority projects. Remaining funds are to be allocated following a competitive process in 2006-07.

Australia's first Road Safety Black Spot Programme was set up in 1990 to reduce road trauma. The current Black Spot Programme was started in 1996 and is now in its ninth year, having been extended on three occasions.

The programme has reduced the risk of crashes by funding measures such as traffic lights, roundabouts, signage and edge sealing at dangerous locations on our roads. These measures:

• prevented more than 1500 serious crashes and 32 fatalities between 1996 and 1999 alone, and
• have saved the community many times the cost of the works, returning approximately $14 in benefits for every $1 spent.

The BTRE, which evaluated the programme in 2001, is to re-evaluate the programme in 2005-06.

A 'black spot' can be nominated through the AusLink website at www.auslink.gov.au

The relevant state or territory roads authority assesses nominations taking into account the crash history of the site and possible treatments. Nominations are then considered by a consultative panel which includes representatives of all levels of government, motoring organisations, police and road freight industry groups.

Most funding goes to treat sites with a proven history of crashes - black spots with a record of at least three casualty accidents over a five-year period - and where work will deliver a benefit to cost ratio of at least 2:1.

Up to 20 per cent of funding is available for proposals which do not meet the above criteria but which are recommended on the basis of a road safety audit. In 2004-05, less than five per cent of funding went to such proposals.

Approximately 50 per cent of Black Spot funding is reserved for projects in rural areas, consistent with the proportion of road deaths and serious injuries that occur in these areas. In 2004-05, more than 54 per cent of funding continued to go to rural projects.

This programme was administered under the Australian Land Transport Development Act 1988 until 30 June 2005. This programme is now administered under Part 7 of the AusLink (National Land Transport) Act 2005.

The maximum funding available for projects in each state/territory is determined by population and the level of road crash casualties. Actual funding allocations for 2004-05 are shown in figure 3C.

While a number of projects are ongoing, in 2004-05 work was completed on:

• The Caboolture Motorway - this project has widened the motorway from four lanes to six from Dolhes Rocks Roads to Boundary Road in Brisbane.
• The Corowa-Wahgunyah Bridge - this project has provided a more reliable, safer and flood-free regional link between Victoria and NSW.
• The Gold Coast Light Rail feasibility study - this study concluded that light rail is the preferred long term public transport solution. For a copy of the Gold Coast Light Rail feasibility study, visit www.pb.com.au/gclightrail

Payments are generally tied to project progress. In 2004-05 most projects and payments progressed as planned, with payments made on completion bringing to an end the Australian Government's role in these projects. Payments were deferred for the:

• Echuca-Moama bridge - work has been delayed while the Victorian Government and the Yorta Yorta National Aboriginal Corporation hold discussions to identify a culturally acceptable alignment for the new bridge crossing.
• Wodonga rail bypass - work has been delayed so that the project can be integrated into ARTC planning and to enable ongoing discussions between the Victorian Government, local councils and industry.

In 2004-05, the Australian Government agreed to contribute $15 million towards the upgrade of the Eyre Peninsula rail network. The SA Government and industry are developing a plan of work and expect to start work early in 2006.

In 1998, when the Australian Government sold its rail business, it established this programme to meet the cost of any residual issues that might arise. In 2004-05, the main residual issue was the AN plan room in Adelaide, which houses more than 180 000 plans and drawings of rolling stock and infrastructure.

While the department was unable to resolve the future of the plan room in 2004-05 as planned, work began on more sustainable long-term arrangements in consultation with the National Archives of Australia and the rail industry. The future of the plan room is now expected to be resolved in 2005-06.

The maritime and land transport industries are the backbone of Australia's economy. Shipping, carrying Australia's international and domestic trade, represented more than 11 per cent of the world's maritime trade, while our road and rail industries carried well over 1.5 billion tonnes of freight in 2002-03.

In relation to shipping, Australian Government policy balances the role of overseas shipping companies which provide most international cargo services and Australian shipping which has a preference for coastal trade. The department:

• registered agreements enabling ocean liner carriers to collaborate to provide regular cargo shipping services to importers and exporters, and
• administered regulations governing coastal trade as well as related programmes (page 74).

In relation to land transport, the department supports the government's efforts to secure more uniform and efficient regulatory arrangements across the states and territories, as they affect interstate carriage. The department progressed national road and rail regulatory reform through the National Transport Commission (page 82).

Trade Practices Act immunity for shipping under review

Liner shipping carried almost half of Australia's seaborne exports and over three quarters of Australia's seaborne imports in 2002-03 (worth $43 and $74 billion respectively).

Part X of the Trade Practices Act 1974 gives ocean liner carriers immunity from key parts of Australia's trade practices laws. It permits them to form Conference Agreements³ to provide regular scheduled cargo shipping services. Similar exemptions are provided by the USA, the European Union, Japan, Korea, Canada and New Zealand.

A wide range of agreements is registered with the department under the Act, each of which is specific to an individual trade route. In 2004-05 we:

• registered fewer agreements and variations to existing agreements, and
• continued to register all agreements and variations within 14 days of receipt.

We also made a submission to and advised government on a Productivity Commission review of the operation of Part X of the Act. The Commission presented its final report to the government in February 2005.

Coastal cargo trade up

Coastal shipping, which carried almost 30 per cent of all tonnage moved around Australia in 2002-03, is vital to the economy of coastal and island communities, particularly Tasmania.

The Navigation Act 1912 requires all vessels trading interstate to be licensed or have a coastal permit to carry cargo or passengers. The volume of applications for licences and permits fluctuates from year to year with demand for coastal shipping services (see table 3.7 page 77 ). In 2004-05 the department issued all permits within target timeframes. This included:

• more coastal trading licences than in previous years-these can be issued to any vessel provided that Australian wages are paid to the crew while it is engaged in coastal trade, and
• more single voyage and continuing voyage permits to foreign ships-permits may be issued where no licensed ship is available or the service provided by such ships is not adequate.

The department also administered programmes to alleviate the costs of shipping items between Tasmania and mainland Australia, with rebates reaching a record $122.3 million in 2004-05 (page 77).

National and international reform supported

In addition to contributing to the reviews mentioned above, in 2004-05 the department:

• started detailed reviews of governance in the Australian Maritime Safety Authority and Australian Maritime College in response to the Uhrig Report (see case study page 13 )
• delivered funding to help establish a new Transport and Logistics Centre of Excellence (page 88), and
• participated in National Transport Commission (NTC) working groups on compliance and enforcement, driver health and fatigue, heavy vehicle charges and performance, and rail reform (see National Transport Commission (page 82 ).

We also supported bodies including the:

• International Maritime Organization and OECD Transport Research programme (page 90)
• Australian Transport (Ministers) Council (ATC) and its supporting Standing Committee on Transport
• Australian Logistics Council-a partnership between the Australian Government and senior leaders created to drive the Australian Logistics Industry Strategy, and
• Accessible Public Transport National Advisory Committee-created to progress national transport access issues for people with disabilities and their families and carers.

Leadership on ship safety and marine environment protection

Australia's heavy reliance on its sea lanes and port operations results in a continual risk of pollution to the marine environment. In 2004-05 the department:

• obtained in-principle agreement from the Australian Transport Council (ATC) for a national system for emergency towage
• put in place interim arrangements to ensure towage services are available pending finalisation of a long-term approach (page 84)
• continued to collect levies from oil companies towards the cost of cleaning up major oil spills (page 86), and
• contributed to the management of marine pests and ballast water issues through participation in the National Introduced Marine Pests Coordination Group and project teams.

The government introduced legislation to amend:

• the Navigation Act 1912 to remove impediments to the successful prosecution of seafarers who breach collisions regulations, and
• four Acts relating to ship safety, the marine environment, maritime navigation and various miscellaneous matters, including increasing penalties for certain breaches under the Lighthouses Act 1911 and the Navigation Act 1912.

Legislation was also progressed to give effect to four international conventions to reduce pollution associated with shipping:

• the Bunkers Convention, which makes ship owners liable for oil spill damages when oil is carried as fuel in a ship's bunker-this will come into effect when ratified by 18 nation states, currently four have signed
• the Hazardous and Noxious Substances (HNS) Convention, which provides compensation for victims of accidents involving HNS such as chemicals
• the Anti-Fouling Systems Convention, which prohibits the use of environmentally harmful anti-fouling systems on ships entering Australian ports from 1 January 2008, and
• the Convention for the Prevention of Pollution from Ships, which sets limits on sulphur and nitrogen oxide in ship exhausts and prohibits deliberate emission of ozone-depleting substances.

For a comprehensive list of relevant treaties and legislation on protection of the sea, visit www.amsa.gov.au/Marine_Environment_Protection/Protection_of_Pollution_from_Ships/Conventions_and_Legislation.asp

Green vehicle guide launched and more to come

Motor vehicle emissions remain a significant contributor to urban air pollution, although cleaner fuels and engines have reduced levels of airborne lead and other pollutants.

In 2004-05 the department continued to work wiith other agencies and the broader community to reduce emissions from Australia's 13.1 million vehicles. We:

• published reports highlighting the health impact of emissions and options for reducing truck emissions in Sydney (see Appendix B page 185 )
• launched the Green Vehicle Guide to help consumers rate and compare the environmental performance of passenger cars, which comprise 80 per cent of vehicles in Australia (see case study page 78 )
• developed environmental performance criteria for heavy vehicles, which operators must meet in order to receive fuel excise credits from 1 July 2006, and
• supported the Australian Bicycle Council to review the National Cycling Strategy 1999-2004.

A new National Cycling Strategy for 2005-10 is to be released later in 2005 which promotes safe cycling as a means of enhancing Australians' health and well-being, improving transport access and reducing greenhouse emissions, air pollution and congestion.

The Tasmanian Freight Equalisation Scheme provides rebates to shippers based on the cost of shipping a standard twenty-foot container (TEU) between northern Tasmania and Victoria, less the cost of sending it the same distance by road (420km). This 'sea freight cost disadvantage' is adjusted where goods are:

• transported on routes other than between northern Tasmania and Victoria
• shipped in transport units other than a TEU, and/or
• shipped other than on a wharf to wharf basis.

The rebate of up to $855 per TEU cannot exceed the actual freight bill paid by the shipper.

• from Tasmania to the mainland for use or sale, and

As in 2003-04, 80 percent of rebates paid were for goods produced in Tasmania and shipped to the Australian mainland for use or sale. Rebates paid on this northbound trade reached $70 million in 2004-05, with the major northbound items subsidised being:

• paper and paper products including newsprint ($19.6 million)
• vegetable and vegetable products ($17.9 million)
• timber, wood and cork products ($10.4 million)
• beverages ($6.0 million), and
• metal waste ($1.7 million).

• to Tasmania as an input to a production process

Goods shipped to Tasmania as an input to a production process may also be eligible for assistance. Rebates paid on southbound trade reached $19.3 million in 2004-05, with raw materials for the manufacturing and mining sectors remaining the major goods shipped.

In 2004-05, eligibility for this scheme was extended to containerised wheat. This resulted in 27 407 tonnes or 1119 containers of wheat being shipped, with approximately $754 000 paid in assistance.

The Tasmanian Wheat Freight Scheme ceased at the end of 2003-04, when responsibility for rebates for containerised shipments of wheat transferred to the TFES on 1 July 2004.

In early 2005, the Australian Government agreed to reinstate this scheme for bulk wheat shipments only.

The value of the rebate was capped at $20.65 per tonne in 2004-05.

This scheme alleviates the cost of seagoing travel for eligible passengers by reducing the cost disadvantage associated with transporting passenger vehicles across Bass Strait.

The actual amount of rebate payable for each crossing is up to $150 for a car, up to $300 for a motor home or vehicle towing a caravan, up to $75 for a motorcycle and $21 for a bicycle.

The impact of the scheme is monitored annually by the Bureau of Transport and Regional Economics (BTRE) within the department. Relevant reports can be obtained from the Bureau of Transport and Regional Economics (BTRE) website www.btre.gov.au

The rebate is provided in the form of a reduction in the fare charged by ferry operators to the drivers of eligible passenger vehicles. Drivers who fly across Bass Strait but ship their vehicle are also eligible for a rebate if they are:

• unable to travel by sea because of a disability, or
• travelling between Melbourne and King Island as the ferry operator on this route carries vehicles only.

The ferry operator is then reimbursed for the total rebate provided to eligible passengers under the scheme. In 2004-05 the major recipient continued to be TT-Line, which operates three major passenger ferries between Devonport and Melbourne/Sydney.

As with the main TFES, claims are processed by Centrelink's Hobart office. An internal audit in 2005-06 will enable us to report against this target from
2005-06.

An independent statutory body, the National Transport Commission (NTC) advises Australian transport ministers on the regulatory and operational regimes for road, rail and intermodal transport, with a particular focus on safety, efficiency and sustainability.

In 2004-05 the NTC continued to work closely with industry bodies, regulators and police to develop practical national solutions and monitor their implementation. Amongst other things, it delivered:

• An innovative set of performance-based standards. These are helping our trucking industry-already one of the most efficient in the world-identify areas where it can become even more efficient, safe and sustainable.
• A fatigue management system that moves beyond hours of work to look at all aspects of the fatigue problem. The system will be easy to check and enforce when implemented, and is expected to improve road safety significantly.
• New compliance and enforcement measures. These are now being applied across the entire logistics chain and are robust enough to make both on-road and off-road offenders accountable.
• Significant progress towards a co-regulatory framework for rail safety, including a new national standard for health assessment of rail workers.

For more information about the NTC, visit www.ntc.gov.au

The Federal Interstate Registration Scheme (FIRS) was set up in 1987 as an alternative to state-based registration for heavy vehicles weighing 4.5 tonnes or more. It provides uniform charges and operating conditions for heavy vehicles engaged solely in interstate operations.

In 2004-05 around three per cent of Australia's heavy vehicles - 8000 vehicles and 9000 trailers - were registered through the scheme. While there was a small increase in the volume of FIRS registrations from 2002-03, the proportion of FIRS registered vehicles compared to Australia's total heavy vehicle fleet remains the same.

The future of the scheme is under consideration as part of broader reforms to road transport including AusLink (page 61).

Revenue collected by state and territory authorities is passed on to the Australian Government. It is then redistributed based on an agreed formula designed to meet the costs of damage to roads caused by heavy vehicles.
The agreed formula splits funds as illustrated in figure 3D below.

Figure 3D - Distribution of interstate road transport fees in 2004-05

Vehicle registrations under this scheme have risen as noted above, and the resultant increase in revenue has been passed on to state and territory governments in full.

The cost of this scheme was $46.2 million in 2004-05. It is expected to increase to approximately $48.0 million in 2005-06 as a result of increases to registration charges from 1 July 2005.

This programme ensures that emergency towage is available to commercial shipping around the Australian coastline until early 2006, pending consideration of more sustainable long-term arrangements by the ATC.

The initial component of this programme ran from January through April 2005. Following the government announcement of an additional component of this programme in early May 2005, a selective tender process was begun to identify businesses able to provide suitable vessels, crew and fire-fighting equipment on short notice 365 days a year^5,6. As at 30 June 2005, two organisations had been selected:

• United Salvage Pty Ltd, a subsidiary of Adsteam Marine Limited, and
• RiverWijs Pty Ltd, a joint venture between the vitzerWijsmuller Salvage Group and Riverside Marine.

A process is also underway to station a dedicated tug boat in north Queensland to respond to any accidents that may occur on the Great Barrier Reef. One of Australia's busiest shipping lanes, this world-famous heritage area supports 54 000 tourism-related jobs and contributed $6 billion to the Australian economy in 2003-04. A final decision is to be announced later in 2005.

Even though there have been no major shipping accidents in Australian waters in many years, the risk of a catastrophic incident remains:

• Around 3300 ships enter Australian waters each year⁷, making more than 23 000 calls at 70 major ports.
• Depending on its type, each ship may carry up to 3800 people or 300 000 tonnes of crude oil.

The actual cost of this programme in 2004-05 was $2.750 million. This comprised:

• $2.000 million as announced in January 2005, and
• $0.750 million as the first instalment of the additional maritime emergency towage component of the programme announced in the 2005-06 Budget⁸.

The owners of oil tankers must take out insurance to cover the cost of any oil spilled from their tankers. However, owners do not have unlimited liability. Their liability depends on the size of their tanker-the bigger the tanker, the larger the liability. The maximum liability for the biggest tanker is approximately $170 million⁹.

Where the cost of compensation resulting from an oil spill exceeds the tanker owner's liability or the owner is unable to pay these costs for some other reason, compensation is payable by the International Oil Pollution Compensation (IOPC) Funds.

Total compensation of up to approximately $390 million would be payable by the tanker owner and IOPC Funds in the event of a major spill. No payment has ever been made by the IOPC Funds for an incident in Australian waters as no spill has ever exceeded the tanker owner's liability/ability to pay.

Levies are collected from all entities who receive more than 150 000 tonnes of crude or heavy fuel oil in a calendar year by sea, based on the expected costs of compensation and overheads of the funds in the coming year.

In 2004-05 contributions to the funds were made by six companies - Alcan Gove Pty Ltd, BHP Billiton, BP Australia Ltd, Caltex Australia Pty Ltd, Mobil Oil Australia Ltd and the Shell Company of Australia Ltd.

In 2004-05 the department reported payments totalling $2.331 million in relation to the funds. This comprised:

• transfers to the IOPC Funds of levies received from oil companies ($1.394 million), as well as
• transfers from the IOPC Funds to oil companies refunding excess levies paid in previous years ($0.937 million).

The Maritime Industry Finance Company (MIFCo), a wholly owned Australian Government company, was established in 1998 to make redundancy-related payments in support of waterfront reforms. It:

• provided funding for 1487 redundancies, finalising all redundancy claims in 2000-01, and
• funded its obligations through a government guaranteed loan of $220 million.

In 2004-05 MIFCo continued to repay the loan, with repayments for the year totalling $21.750 million.

The department collects levies from industry to cover the cost of MIFCo loan repayments under the Stevedoring Levy (Collection) Act 1998. In 2004-05 levy revenue totalling $39.7 million was passed on to MIFCo.

Under this programme MIFCo also received $8.8 million for its administrative expenses ($0.240 million) and interest charges associated with its loan facility ($8.535 million).

Around 10 per cent of the transport and logistics workforce will retire over the next decade, at the same time as demand for freight transport is forecast to increase dramatically.

In response, the Australian and NSW governments agreed to co‑sponsor the establishment of a new national Transport and Logistics Centre of Excellence.

While the centre will be located in Sydney NSW, online training and education programmes being developed by the centre will be accessible to students across Australia.

This model builds on the success of two other industry-focused educational institutions, the Australasian-Pacific Aeronautical College (page 107) and the Australian Maritime College.

Both these colleges received seed funding and are now highly regarded, self-reliant institutions-the Australian Maritime College was recently ranked the number two university for teaching performance in Australia.

We administer payments to and represent the Australian Government at meetings of three key international bodies of which Australia is a member:

• the International Civil Aviation Organization (ICAO)-an agency of the United Nations (UN) that promotes the safety, regularity and efficiency of international civil aviation¹⁰
• the International Maritime Organization (IMO)-an agency of the UN that promotes 'safe, secure and efficient shipping on clean oceans', and
• the OECD Transport Research programme-this focuses on road, rail and intermodal transport research.

In 2004-05 we:

• on civil aviation

• maintained a presence at ICAO headquarters at Montreal as required given Australia's status as a Category One member¹¹
• represented Australia on the ICAO Council and ICAO air transport and unlawful interference committees
• asked ICAO to audit our aviation safety investigation regime (page 32)

• on maritime transport

• contributed to the development of a number of IMO instruments that will promote the aims of IMO and advance Australia's interests including:
  • preparation of guidelines on the control and management of ships' ballast water and sediments
  • revision of the Convention on the Supression of Unlawful Acts Against the Safety of Maritime Navigation
  • preparation of a new international convention on wreck removal, and

• on road, rail and intermodal transport

• represented the Australian Government at international forums on road, rail and intermodal transport issues, such as pricing, safety and asset management.

Significant regulatory workload in 2004-05

The Australian aviation industry employs more than 50 000 people and carries more than 50 million passengers and 10 million tonnes of freight around, into and out of Australia each year.

It has undergone significant changes in recent years as a result of the Asian economic crisis of 1998-99, the events of 11 September 2001, the collapse of Ansett on 12 September 2001, the 2002 Bali bombing, the SARS pandemic of 2002-03, the Iraq War, and changing oil prices.

Both industry and government are continuing to adapt to an environment of rapid change. In 2004-05 the department:

• undertook reviews to examine governance in CASA and Airservices Australia in response to the Uhrig report (see case study page 13)
• began planning for a new regulatory system for aviation information, meteorological and tower, fire-fighting and rescue services
  consulted with airlines and airports on price monitoring arrangements for seven major airports
• completed a review of the Airports Act 1996 taking into account submissions from more than 60 stakeholders, and
• administered leases for 22 federal airports in line with the Act (page 97).

Also in 2004-05 works at Melbourne Airport to enable customs and quarantine staff to screen and inspect much larger amounts of passenger luggage were completed at a cost of $6.3 million.

While this work brings to an end the Airports Quarantine Infrastructure Programme announced in 2001, the department continued to work with border control agencies on security and facilitation arrangements at international airports. Our current focus is on ensuring airport infrastructure can handle:

• the current and expected growth in tourist numbers over the next ten years, and
• the introduction of the Airbus A380 in late 2006, which can carry over 555 passengers per flight (almost 40 per cent more than other aircraft operating in Australia at present).

International air services

Today, 47 airlines operate services into and out of Australia. They carry 99 per cent of the 18.1 million people who come into or out of Australia and around 600 000 tonnes of freight each year.

In 2004-05 we continued to support the Australian Government to improve Australia's access to key international markets, including the important European and Asian markets. The government:

• signed a bilateral aviation safety agreement with the US which will facilitate access by Australian manufacturers to the massive US market
• gained European Commission agreement to seek a mandate to negotiate a single, liberalised Australia-Europe air services agreement
• negotiated new air services arrangements with Mexico, Ireland and the Czech Republic and improved existing arrangements with India, Russia, Taiwan and Egypt.

In addition, the department:

• drafted legislation to allow mutual recognition with New Zealand of air operators certificates for larger aircraft, reducing regulatory red tape for airlines
• continued to provide secretariat services to the International Air Services Commission www.iasc.gov.au, which allocates access to international markets for Australian airlines, and
• was tasked by government to review Australia's international aviation policies, including the implications of the Singapore Government's request to assess the Australia-US route-the review is due to be completed by the end of 2005.

The department also continued to support the government's efforts to pursue cooperative international approaches through the ICAO (page 90), the World Trade Organization, Asia Pacific Economic Cooperation (APEC), Papua New Guinea Enhanced Cooperation Program and the Pacific Islands Forum.

To facilitate discussions, Australia is preparing to host meeetings including the 42nd annual conference of senior officials of all government and aviation regulation authorities in the Asia-Pacific in September 2005.

Regional aviation services expanding

Despite the collapse of Ansett in 2001, domestic and regional air services have continued to grow with the number of scheduled passenger flights increasing 11 per cent over the decade to 2003-04. Recent developments have included:

• Virgin Blue steadily expanding its route network, and
• Qantas' low cost domestic airline Jetstar adding new routes and capacity across the country.

In 2004-05 the department implemented a number of government initiatives. We:

• met in full the Australian Government's obligations to help set up the Australasian-Pacific Aeronautical College (page 107)
• wound up the scheme to subsidise the cost of air-traffic control charges at smaller regional and general aviation airports as planned (page 106), and
• continued to reimburse eligible air operators for en-route navigation charges incurred in the provision of regular public transport and aeromedical services to regional communities (page 105).

• parking fines (page 103)

• sale of airport land (page 103)

• land acquisition (page 103)

Continued support for airspace reform

Australia's national airspace system (NAS) is modelled on the US system which has operated for the past 40 years and which handles 20 times the volume of air traffic that exists in Australia. It is simple, compliant with airspace practices endorsed by ICAO, and involves different arrangements for different parts of airspace based on risk.

Implementing the system has been a long process. NAS Stage 1 was rolled out in November 2002 and Stages 1a, 2a and 2b were introduced in March 2003, July 2003 and November 2003, respectively.

In 2004-05 new procedures were developed for non-towered aerodromes to improve overall safety and efficiency-these will be introduced in November 2005 and supported with industry forums and a training package (NAS Stage 2c).

In 2005-06 work will proceed on the final major NAS reforms-Stage 3a-allowing more freedom of movement for civilian aircraft in airspace used by the Australian Defence Forces.

We also expect that Airservices Australia's remaining airspace regulatory functions, which have been consolidated into the Airspace Environment Regulatory Unit within Airservices Australia, will be reviewed and transferred to a new Office of Airspace Management within the department. This will:

• free Airservices Australia up to focus on its role as an air navigation services provider, and
• provide the government with a focus for airspace policy and regulation.

Leased federal airports managed responsibly

Between 1997 and 2003 a total of 22 airports owned 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. Rights to operate these airports were leased out for an initial period of 50 years with an option to renew for another 49 years taking the potential lease period up to 2102¹².

The department is responsible for administering the Australian Government's interests in the ongoing operation and management of the privatised airports under the Airports Act 1996.

Under the Act, airport lessees must produce a master plan with a 20-year planning horizon-these are mainly focused on the development of the airport site itself but must have regard to the surrounding area-and an environmental management strategy for the airport. Both must be submitted to the minister for approval and be reviewed every five years. In 2004-05 the department advised the minister on:

• 13 airport master plans
• seven major development plans, and
• 18 environment strategies.

In addition, during the course of 2004-05, the Federal Court handed down a major ruling on the Act in the Australian Government's favour (page 164).

The department is also responsible for oversighting contractual obligations outlined in airport sale and lease agreements and conducts annual reviews to ensure compliance with lease conditions. In 2004-05:

• 17 reviews were completed by 30 June 2005 and another four reviews in
  July 2005
• the remainder are to be completed by October 2005, and
• no significant issues affecting lease compliance were identified.

Building controllers and environmental officers at lessee airports also helped the department to monitor and ensure compliance with environmental and building standards.

Investment in aeronautical infrastructure tops $380 million

Lessees for 10 airports-Adelaide, Brisbane, Melbourne, Perth, Alice Springs, Darwin, Canberra, Coolangatta, Hobart and Launceston-have also committed to invest a total of $700 million over the first 10 years of the leases in aeronautical infrastructure¹³. In 2004-05 the department continued to monitor this type of investment at these airports.

As at 30 June 2004, more than $380 million had been invested by the ten airports in aeronautical infrastructure. Eight lessees had met or exceeded their period one obligations (see table 3.10). Of the two remaining lessees:

• Hobart is expected to exceed its period one obligation to invest $3.8 million following the opening of its new domestic terminal building in April 2005, and
• Alice Springs is expected to have met its period one obligation to invest $1.2 million in 2004-05.

Overall indications are that most airports will exceed their ten year development obligations in 2004-05:

• two lessees-Melbourne and Adelaide-have proceeded to exceed their total ten-year obligations and are no longer required to submit plans or reports to the department
• Adelaide's new $260 million passenger terminal is to open in October 2005, and
• Melbourne has started taxiway, runway and terminal upgrades to facilitate the new 555 seat Airbus A380.

While all airports continued to submit their expenditure plans and audited reports to us as required, timeliness continued to be an issue (see table 3.11). We are working to address this in 2005-06.

In 2004-05 the department also:

• made significant progress in implementing the nine recommendations contained in the ANAO Report 50 of 2003-04
• worked with the Department of Environment and Heritage on the approval process for the proposed development of the new parallel runway at Brisbane airport
• acquired land at Sydney Airport to facilitate further on-airport development (page 103), and
• continued to make sure government-owned rental properties at Badgerys Creek were appropriately maintained (page 104).

Aircraft noise measures maintained

In order to minimise aircraft noise exposure, all civil aircraft in Australia are required to comply with aircraft noise regulations under the Air Navigation Act 1920.

In order to manage night-time aircraft noise, curfews apply from 11pm to 6am at four major airports-Sydney, Adelaide, Coolangatta and Essendon¹⁴. Under the curfews strict controls apply to what types and numbers of aircraft can operate and what runways can be used.

In 2004-05 the department continued to manage the curfew system. We:

• assessed 161 applications for curfew dispensation (112 for Sydney, 36 for Adelaide and 13 for Coolangatta), and
• approved 81 curfew dispensations (50 for Sydney, 22 for Adelaide and 9 for Coolangatta), and
• provided secretariat support for the Sydney Airport Community Forum, www.sacf.dotars.gov.au, which advises the government on noise and related environmental issues at Sydney Airport.

The department also continued to administer programmes to insulate homes and public buildings near Sydney and Adelaide airports assessed as being exposed to unacceptable levels of aircraft noise (see below).

Airport noise amelioration programmes were introduced to Sydney and Adelaide in 1994 and 2000 respectively. Under both programmes, the Australian Government pays for noise insulation to be installed in eligible homes and public buildings such as schools, colleges, preschools, health and aged care facilities and churches.

Eligibility for insulation is based on aircraft noise exposure as assessed under the Australian Noise Exposure Forecast (ANEF) system. This system takes into account the relative noise and numbers of aircraft overflights.

To be eligible, a public building must fall within the 25 noise exposure contour under the ANEF system and a residence within the 30 noise exposure contour. To avoid neighbouring houses being treated differently the boundaries of contours are extended out to the nearest break in continuity of housing - normally the next street.

For details of the properties that have been insulated, visit www.dotars.gov.au/transport/programs/

For information on noise and flight path monitoring at major airports, visit www.airservicesaustralia.com/reports/nfpms

This programme reimburses seven airport lessees a proportion of parking fines collected for parking offences in airport precincts.

In 2004-05 we continued to make payments to airport lessees based on a formula set by the Minister for Finance and Administration, namely 80 per cent of the revenue collected from parking fines after administrative costs.

• for the acquisition of airport land to improve access within Sydney airport ($3.4m)

• for the sale of small portions of airport land not essential for airport operation ($0.003m)

We executed a land transfer agreement on 13 July 2005 to enable road widening and other traffic improvements off the Hobart airport site, and are working on amendments to Airport Regulations 1997 to reflect the change in the leased area.

Negotiations are continuing over:

• the sale of land from the south-west corner of Essendon Airport to facilitate the upgrade of the Tullamarine/Calder Freeway interchange (cost to be determined), and
• the sale of land from Coolangatta Airport to facilitate the Tugun Bypass project.

This programme helps operators provide services to regional communities by reimbursing them for Airservices Australia's en route air traffic control charges.

A review is to be conducted into the ongoing need for en-route subsidies for regional aviation services, which are due to cease at the end of 2005-06.

The turnaround time for invoices is a maximum of seven days from receipt of all information required to process the claim. Payment runs for the department occur weekly.

Over 2004-05 no complaints were received from recipient operators on the accuracy or timeliness of processed claims.

In mid-1998, Airservices Australia introduced a new pricing regime to remove cross-subsidisation of some part of the aviation industry by other parts. As some smaller airport users faced large fee rises, the government introduced a subsidy for a transitional period.

The subsidy was due to have ceased in 2003-04 but was extended for one year only, to enable Airservices Australia to review its pricing arrangements. The subsidy continued to be paid directly to Airservices Australia on a monthly basis.

A licensed aircraft maintenance engineer (LAME) is the only person who can certify that work is completed to regulatory requirements and standards or supervise other people doing maintenance work on an aircraft.

The Australasian-Pacific Aeronautical College was set up in 2001 to address the shortage of aircraft engineers in regional Australia. It offers a Certificate IV in Aeroskills-one of several prerequisites for people wanting to become a LAME-and vocational education to schools in the Tamworth area and to TAFE students.

In 2004, 134 students were enrolled at the college and 44 people graduated with a Certificate IV in Aeroskills. The number of graduates in 2005 will not be known until later in the year.