ANALYSIS: What is delaying the reform of European ATC?

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Delays in implementing the Single European Sky have prompted airlines to call for a new push to speed the process. Former CANSO director general Graham Lake considers the challenges in breaking the deadlock on reforming European ATC

Frustration with the slow progress of the implementation of Single European Sky (SES) is nothing new. As IATA director general Tony Tyler recently observed: "People have been talking about Single European Sky for 20 years now and I fear in 20 years they will be talking about it."

This frustration has prompted IATA, together with the Association of European Airlines and European Regions Airline Association, to publish a blueprint for the SES. If airline dissatisfaction with delays to the planned benefits of SES is a familiar refrain, these new proposals for delivering progress mark a change in tack. It is a pragmatism that is likely to be noticed by lawmakers at the EU, which itself is critical of member states and air navigation service providers for poor progress with SES deliverables

The EU is itself developing its own proposals for the next tranche of SES legislation, dubbed the SES II+, to further strengthen the legislative SES packages already introduced in 2004 (SES I) and 2009 (SES II).

The airlines' SES blueprint highlights the economic benefits of air transport, the economic consequences of inaction, both acknowledged by the EU, and proposes three key reforms:

  • The creation of a mature performance system;
  • The rationalisation of air traffic management institutional structures; and
  • The modernisation of the ATM system.
  • The blueprint proposals are clearly intended to inform and guide legislative development, and to improve the rate of progress towards achieving the objectives of the SES that were set out by politicians in 2004, namely:
  • A threefold increase in ATM capacity where needed;
  • An improvement in safety performance by a factor of 10;
  • A 10% reduction in the impact that flights have on the environment; and
  • Reducing the cost of ATM services to airspace users by at least 50%.

The airlines are calling for the establishment of an independent European economic regulator for air navigation charges, to define the targets to be achieved, oversee progress and to determine binding financial corrective action.

Meanwhile, Sylviane Lust, director general of the International Air Carrier Association (IACA), is clearly equally frustrated with SES progress. Speaking in Amsterdam in March, she noted that EU member states and ATM providers have simply ignored their obligations previously signed up and agreed on at the EU level. Binding agreements need teeth.

Slow start

The SES blueprint makes sensible points on technology implementation, where more than €2 billion ($2.6 billion) has been committed to research and development since 2004 - an estimated 3,000 people are currently employed on research and validation works. However, there is neither a clear plan nor adequately defined funding for the implementation of the new systems that will result in capacity and efficiency improvements.

It is in the area of rationalisation that airlines' demands are gaining most focus and detail, and the area of cost that is getting the most attention.

Progress by ATM providers in reducing operating costs has been much slower than that demanded by the users, and in some cases, slower than previously agreed by governments and their service providers. For example, the nine functional airspace blocks (FABs) designed by the EU to drive local consolidation of airspace and services, and agreed by EU states, seem unlikely to deliver the envisioned consolidation.

Progress is slow partially because the essentially fixed costs of the ATM provider have not been able to benefit from the reduced unit costs that historically increasing traffic volumes naturally deliver. According to both the US Federal Aviation Administration and Eurocontrol forecasts, the impact of traffic downturn will not improve in the foreseeable future.

The political targets for SES on cost and capacity, set in 2004, are looking increasingly remote from today's economic and business reality.

What has happened to traffic from the ATM perspective?

Both the FAA and Eurocontrol recently published their latest long-term traffic forecasts. Both note that while passenger traffic may be slowly recovering, the number of aircraft flying is not improving at the same rate.

According to the FAA figures, in 2012, air carrier operations were 5.3% below their 2000 activity levels. Operations for the general aviation and military user groups were 26% and 56% below their 2000 activity levels, respectively.

In the USA, the mainline carriers' passenger jet fleet now stands at 16% below (707 aircraft) the level it was in 2000. Total activity at FAA en route centres will not recover to 2000 activity levels until 2020.

In Europe, the traffic picture is not so bleak, but according to the latest Eurocontrol forecast, ATM traffic will not recover to 2008 levels until 2016, if forecasts on economic growth in the eurozone are achieved.

Eurocontrol also points to constrained airport capacity and the high-speed train network further reducing demand for ATM capacity in some states. This lack of growth places governments and air navigation service providers in a difficult position. They are being obliged to grow capacity, invest in new technology and simultaneously reduce unit costs. This cannot be resolved at a national level in Europe. It is not surprising that progress has been slow.

Tough road

In an industry where perhaps 70% of the costs are personnel, cost reduction initiatives inevitably lead to discussions with labour organisations. This challenge was recognised as a key element of the success of SES by regulators from the outset 10 years ago. The so-called social dialogue pillar of SES is intended to provide for a negotiated solution.

The European Economic and Social Committee (EESC) is an organisation tasked to inform the EU on social issues related to EU regulation. Jacek Krawczyk, vice-president of the EESC, noted that at the January EESC hearing on SES, the risk of deadlock with the trade unions was palpable, calling for a wider participation of social partners. In other words, it is very difficult to negotiate staff out of their jobs and real progress is still a long way off.

Meanwhile, the IATA blueprint for SES has proposed clear cuts and consolidation as a way forward in Europe, noting an EU report that the removal of ATM inefficiencies will drive €419 billion of GDP growth and the creation of 320,000 new jobs by 2030.

Three key changes are featured in the proposal - performance, rationalisation and modernisation.

The rationalisation proposals designed to reduce ATM costs are:

  • A regrouping of the en route air navigation service provision at FAB level;
  • Ensuring a reduction of the number of air traffic control centres from 63 to 40;
  • Ensuring a reduction in the number of support staff for each air traffic controller from the present ratio of 2.4, to 1.6;
  • An unbundling of the support infrastructure and services: Communications, Navigation and Surveillance (CNS), Meteorology (Met) and Aeronautical Information Management (AIM).

This will mean the realignment or elimination of thousands of jobs. The airline proposal also calls for supported development of career-path options for displaced ATC staff.

This does not mean that the solution is clear. Politicians rarely support proposals that lead to elimination of jobs in their constituencies. The political will to drive staffing reductions is likely to be hard to find.

Lord Soley of Hammersmith, a UK Labour party politician and supporter of the development of London Heathrow, suggested a way forward in March: "Is it sensible that the locations of jobs with the manufacturers of ATC systems, those at the research centres, those at the training centres, and the system planners, should be located in the same countries as the air traffic control centres that survive this cull of jobs demanded by airlines?

"Nations that lose ATC centres might win jobs in research, manufacturing, planning or training. Sharing the pain and the gain! I see no such effective plan in ATM. Surely this has to change."

Certainly there seems to be growing consensus that more needs to be done with these social issues. The airlines' blueprint is likely to sharpen focus on this issue and the viability of the original cost and capacity objectives of SES.

Graham Lake, is a principal at Aviation Management and spent his career in aviation services and ATC, most recently serving as director general of CANSO