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Mark Gosche Address To Aviation Industry Assoc.

21 July 2000 Speech Notes
Mark Gosche, Minister Of Civil Aviation
Aviation Industry Association Conference

Kia ora koutou, talofa lava and greetings to you all.

Thank you for the opportunity to speak to you today. During my time as Minister of Transport and my past involvement with the Transport Select Committee I am well aware of the important perspective that the Aviation Industry Association brings to any discussion on aviation issues. Your Association is unique in its make-up of eight varied divisions that range from the one-man or one-woman operation to the large air transport organisations and major airports. Your Association has developed impressively since its inception in 1949 to become the organisation representing commercial aviation in New Zealand today. I value the opportunity to be here today. In particular I would like to acknowledge your Association’s President, John McCall, Vice President John Funnell and distinguished guests.
Aviation environment

A lot of my time as Minister to date has been spent meeting with individuals, industry sector groups and community organisations about the way forward for transport. One of the recurring issues in these discussions has been the aviation environment in which you operate. This afternoon I would like to share with you my vision for the type of aviation environment New Zealand should have, and particularly, the type of working relationships that are pertinent to achieving this environment.

I believe there needs to be improvement in the aviation environment I have inherited. I believe it needs to be more open and consultative. We need an environment that encourages information sharing and a culture that enables us to learn from the small mistakes before they become accidents. That requires openness and mutual confidence amongst the participants. I think we have some way to go in achieving this.

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AIA relationship with CAA

I know that some of you have had concerns about the performance of the CAA. I also know that both your Association’s president and the CAA chairman have been working together to reach a constructive solution to the problems. The re-structuring of the CAA, which is intended to bring a sharper industry client focus to that organisation’s management team, was in part a response to your Association’s concerns.

I understand that some good progress has been made at the two recent summit meetings held between the AIA and the CAA. The CAA is keen for more representatives from your Association to be present at future summit meetings. I know that the Chairman has encouraged the Divisional Chairs of the AIA to participate in the meetings. I endorse his request. I believe it is important that representation at the summit meetings reflects all the membership of the Association.

Review of CAA

Notwithstanding the good progress recently made between your Association and the CAA, I have already announced that I will be conducting a review of the CAA.

The review will pick up on some of the concerns your representatives raised with me when I took up office as Minister and consider some broader concerns about aviation safety. It will also look at whether the CAA is doing an effective job, especially with the smaller general aviation operators.

Generally speaking, the review will assess the effectiveness of the CAA in carrying out its statutory functions within the present regulatory framework and institutional arrangements. It will also examine CAA’s systems and processes for monitoring General Aviation aircraft operations, and the CAA’s selection and application of the different regulatory tools available to it, including education, enforcement and administrative actions.

In addition, the review will look at whether management systems are operating effectively, and whether the way in which the principle of “safety at reasonable cost” is being applied by the CAA is delivering the appropriate safety outcomes.

Finally the review will look at the nature of the relationship between the CAA and the aviation community, and the effectiveness of the CAA in managing these relationships in order to promote a safe aviation environment.

I recently completed the draft terms of reference for the review and I am now consulting on these with industry. Your Association is currently in the process of providing feedback to me on the terms of reference and I welcome the opportunity to consider views before the draft terms will be finalised. I hope to get the review underway in October, once the CAA’s new organisational arrangements have had time to settle down.

Rule Making Process

I know that some of you in this room have had concerns with the rule making process. Some of you may believe that not enough consideration is given to the financial implications of rules on small operators.

I understand the importance of cost issues, especially for small operators. You will understand that they have to be weighed against the community’s safety concerns.

As I just mentioned, the principle of “safety at reasonable cost” is one of the issues being canvassed in the review of the CAA. I want reassurance that the way in which the CAA is applying this principle is delivering appropriate outcomes.

You may also be aware that some changes have recently been made to the rule making process. These changes provide for greater participation by the Minister of Transport and Cabinet in determining the rules programme up front. I shall also want to make sure that there is greater analysis of rulemaking priorities at an early stage in the process.

Consultation with industry and other stakeholders will continue to be an integral part of the rules development process. In addition the process will continue to require that I, as Minister, am made aware of issues that have not been able to be resolved.

Before I leave the subject of rules, you will be interested to know that Cabinet has recently approved the aviation rules programme for 2000/01. The programme includes:
 development of rules on pilot licences and ratings;
 aerodromes certification, operation and use;
 special aerodrome operating rules and noise abatement;
 agricultural aircraft operations; and
 aviation training organisations’ certification.
The CAA will soon be consulting on these topics.

Airways Corporation Charges

I am aware that there has been a lot of criticism of Airways Corporation as a result of that organisation’s charges. I believe it is essential that the necessary requirements for safety at reasonable cost are clearly spelt out so that everyone is aware of exactly what is needed. I am keen to ensure that the general aviation industry – represented by the AIA – retains the ability to access services crucial to civil aviation safety. But the services do have to be paid for, and it is hard to argue for cross-subsidies from the airlines.

I understand that there have been on-going talks between CAA and the AIA to work through these issues.

Certification Costs

I am also aware of this Association’s concerns with certification costs. New rules require operators to have safety management systems which detail their operational practices. I acknowledge that larger operators are generally comfortable with the need for documented manuals and procedures, but many smaller operators can have difficulty meeting the costs of new standards. The CAA argues, however, that improved safety management is essential if this sector of the industry is to lift its performance. I look forward to hearing the CAA review’s findings on this.

I am bound to say however that a particular focus of concern at the moment is the accident/incident rate for smaller commercial aircraft. I am interested in the AIA’s views on where it sees the priorities for safety measures and how CAA and industry together might bring about the improvements in the safety performance of this sector. Your views will be important in supplementing the findings of the review of the CAA in telling me if we have our priorities right for achieving the type of safety outcomes we require.

Setting Safety Goals

You may be interested to know that the Government is presently engaged in a major exercise in the land transport sector called “Road Safety Strategy to the Year 2010”. This project involves developing road safety targets for the decade to 2010 and strategies for achieving these targets. This is proving to be a complex task and will involve some tough decisions about where best to direct road safety resources.

I believe that the work being done on this exercise has implications across all of the transport sectors. Once the consultation and process has been finalised in the land transport sector, I want to turn my attention to the best way to set our safety goals in the aviation sector. We will need to do some fundamental thinking and have a considered debate on the issues. I hope that this Association’s branches and members will participate in that debate.

Review of safety investigations

I would also like to take this opportunity to discuss any concerns you have regarding our current institutional arrangements and processes for the investigation of accidents and serious incidents. This financial year I am asking officials to have a look at safety investigations. They will look in part at overlaps by agencies in the investigation of accidents and incidents. To what extent are they necessary? Can the process be improved?

I am sure that branches and members of this Association have their own views on our arrangements for accident investigations, including the process for handling accident and incident notifications. I am keen to hear those views and consider these issues as part of the proposed review of accident investigations.

Proposed amendments to the Civil Aviation Act

As most of you will be aware, the government has proposed a number of amendments to the safety provisions of the Civil Aviation Act. The more significant of these relate to the exercise of the Director Of Civil Aviation’s powers to suspend and revoke aviation documents and the destruction of bogus parts.

Your Association, amongst others, has already been consulted on these proposals. I know your comments are due to be with me shortly so I look forward to reading your views.

There will of course be plenty of opportunity for you to make your views known on the proposals when they go before the Transport Committee, probably around late November – early December.

Air rage

I recently met representatives of the Flight Attendants’ Association who raised my awareness of a growing problem that has been dubbed “air rage”. The association is supporting the civil aviation trade union organisations in Britain and Australia, which are campaigning for greater protection for airline staff against violent passengers.

The issue is attracting significant attention from the international aviation community with, predictably, demands for stronger enforcement measures from some quarters but assurances from others that this is not a problem for us. Having heard the evidence at my meeting with the Flight Attendants’ Association, I believe that we do need to give consideration to this issue. Are longer flights, no smoking bans and more alcohol consumption by passengers behind rising violence in the air? There is some substantive work to be done on this issue.

We need to consider what type of measures are needed to combat this increasing problem and what legislative changes are needed.

International Air Transport

There is a lot of dynamic and challenging work happening at the moment in the aviation industry. We are now enjoying a time of historic change. Air New Zealand has just completed its purchase of Ansett Australia, and Ansett New Zealand will shortly be trading as Qantas New Zealand. Increasingly the aviation industry is taking on what might be described as an Australasian flavour.

It is an important objective of this government to ensure that there are opportunities for our carriers – and indeed for carriers in our market – to provide the services that we need to grow our trade and tourism.

Air Services Agreements

As part of Labour’s tourism policy we agreed to continue to negotiate “open skies” air services agreements. In the Party’s transport policy we promised to broadening bilateral reciprocity agreements for New Zealand airline access to overseas markets.

We are delivering on those commitments. Since taking office this Government has signed two new “open skies” air services agreements in the South Pacific – with the Cook Islands and with Samoa. The latter creates important new opportunities, not only for Air New Zealand but also for Polynesian Airlines, which is in the process of re-equipping and expanding.

I am optimistic about progress in our air services relationship with Australia. With the completion of the Air New Zealand purchase of Ansett Australia, and a change in Australian policy announced last year, I hope that it should soon be possible to negotiate an “open skies” agreement between New Zealand and Australia. This would remove the restriction that has for some years prevented our airlines operating more than a limited number of flights beyond each other’s territory.

New Zealand and Australian officials have been exchanging draft texts and I plan shortly to be taking a negotiating mandate for the New Zealand delegation to Cabinet for decision.

Other priorities for the coming year include removing restrictions in our air services arrangements with China, Japan, Korea, France, Canada, the United Kingdom and South Africa.

I would like to be able to add Fiji to that list but the sad recent events in that country make that unlikely in the near future at least.

In the cases of Italy, Brazil, Switzerland and Spain we would like to be able to make provision for the airlines of our countries to offer code shared flights.

Air Services with Italy

With many of the countries I have just listed we are now enjoying spectacular growth in passenger numbers. You won’t be surprised to hear that, following the Americas Cup, Italian interest in New Zealand was significantly heightened. In the year ended May 2000 visitor numbers from Italy grew by 39%.

Ministry of Transport officials plan to be negotiating with their Italian counterparts later this year with a view to my subsequently hosting the Italian Minister to finalise a new air services agreement. An agreement with Italy would mean that New Zealand would have air services agreements with all of its top 25 markets in terms of passenger numbers.


The work that the Government has to do in the aviation sector can only be done in partnership with industry, sector groups and the community at large. I said at the start of my speech that I spent the first few months of my time as Minister talking to a wide variety of groups about their views on the aviation environment I inherited.

The policy directions that I have outlined this afternoon should enable us to start to change that environment and move forward to tackle the key problems that face us.

I still want to hear your views and feedback as we progress through the issues. I want us to forge a positive working relationship with open agendas and good channels of communication. My being here today is part of that process and I thank you for the opportunity to give you my views.


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