Australia’s Civil Aviation Safety Authority (CASA) is seeking industry input on plans to move to full cost recovery for regulatory services, in line with government policy.

But the proposal is already coming under fire from the country’s aviation industry associations, which are concerned that the authority is not reducing its own costs and the plan will result in greater pressure on the already-struggling aviation sector.

The new funding guidelines imposed by the government will see a phased reduction in fuel tax from 2008 and no increase in funding from government appropriations. Revenue raised from regulatory services will rise from A$5 million ($3.8 million) a year today to A$20 million by 2008-9. The increase in cost recovery would mean fees for services would account for 16% of CASA’s revenue by 2008-9 – compared with just 4% today – with the remaining 84% coming from fuel excise and government funding.

The authority last week issued a discussion paper proposing three options for cost recovery. The first is similar to the current fee structure, but would see fees applied to more services and at higher rates; the second would involve the introduction of different fees for different services; and the third option proposes the introduction of a wider registration/licensing fee with annual renewals.

“CASA has not made any decisions on cost recovery at this point and before we do make decisions we want input from the aviation industry,” says Bruce Gemmell, chief operating officer.

But CASA should look at its own efficiency before trying to “gouge another A$20 million from industry”, says Phil Hurst, chief executive of the Aerial Agriculture Association of Australia. “CASA needs to ask how do we cut costs – we are bloated and inefficient.”

Hurst says 63 cents in every dollar that goes to CASA is spent on support functions, while A$60 million of its A$100 million budget goes on staff costs.


Source: Flight International