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Archives for October 2013

What’s SMS really about? CAA Director Graeme Harris discusses…

CAA Director Graeme Harris

CAA Director Graeme Harris

Although the submission period on the implementation of SMS has ended and the summary of submissions is published, there were a number of crucial questions that had apparently not been addressed. We asked CAA Director Graeme Harris to discuss them.

First, Des Lines noted that there were only 48 written submissions and, of those, only 23 were from General Aviation maintenance organisations and operators.

From the Summary of Submissions, it is recorded that although feedback was also received verbally from many of the more than 300 attendees at the SMS Forums, no feedback whatsoever was counted in the responses on any particular subject.

With reference to the choices given to industry over SMS, page 5 of the SMS Consultation document – in a bold, framed paragraph – discloses that the CAA recommends Option 4: mandatory implementation of risk management systems across the spectrum of New Zealand aviation.

Des told Graeme Harris: “From past experience of CAA consultations – for example, that used for the increased fees, levies and charges introduced in 2012 – it is widely believed that responses that do not accord with the desired CAA result are invariably brushed aside.

“To declare the CAA’s policy ‘recommendation’ right at the beginning of a ‘consultation’ gives a very strong impression of the likely result. It is seen as a fait accompli. This naturally stifles robust debate within an already far-too-brief submission period because the interested parties believe that it is virtually impossible to influence any policy changes the CAA wishes to introduce”.

Des asked Graeme Harris:

1) Who and what is the SMS roll-out targeted at? It appears to only be those operators currently required to presently have QA systems – i.e. the current certificate holders such as small airlines (Part135) and maintenance organisations (Part 145).

GH: Existing organisational certificate holders.

2) If the CAA is indeed indicating that SMS systems are required universally, then there is the need to require all institutional operators (i.e. everyone except purely private owner/flyers) to operate under an SMS – and therefore everyone must be certificated. Is this the CAA intention?

GH: No – Refer response to Q1 above.

3) Much of the cost of writing and implementing a SMS arises from interactions with the CAA. With the hourly rate due to rise to $284/hr in 2014, and the CAA “clipping the ticket” with each required amendment to an SMS, this is likely to be a considerable financial burden for small operators who have little or no ability to recover their costs.

Is it the CAA’s intention to provide assistance to these small operators by developing model SMS systems that can then be easily tailored to match a specific operator’s organisation?

GH: Irrespective of whether mandatory or voluntary implementation is required, the CAA will certainly work with sector-representative bodies to assist uptake of SMS. At the moment, the form of that co-operation has not been defined. Note also that the cost impact will vary according to the implementation arrangements. The costs will vary according to whether mandatory or voluntary implementation is adopted and if the former, the implementation timeline eventually decided upon.

4) Would the CAA be prepared to accept the Australian model of not charging operators for audits, thus reducing the financial pressure and making the adoption of a SMS easier?

GH: The CAA does not have the option of not charging for its audits.

5) ICAO does not require implementation of a “risk management system” which the CAA is proposing, but requires a “safety management system”. It is our understanding that there are subtle and very important differences between the two systems.

Would you please define the CAA view by comparing and contrasting these two distinct systems?

GH: The CAA is proposing a risk-based approach to regulation. Part of that risk-based approach is the adoption of Safety Management Systems by organisational certificate holders. With a couple of exceptions, the form of SMS proposed is the same as that adopted by ICAO.

6) With regard to voluntary occurrence reporting, the data and information supplied to the CAA has no legal protections for disclosure other than the Privacy Act (where that information applies to individuals) or within the Official Information Act under certain circumstances.

What protection will be available to individuals and organisations to safeguard them from the Regulator pursuing prosecutions under the relevant sections S.43, S43A, and S44 of the Civil Aviation Act?

GH: Note our Regulatory Operating Model document, particularly page 4, section “Promoting a Reporting Culture”. In addition, note that the CAA is promoting the adoption of increased legal protection for both voluntary and mandatory reporting in its input to the current review of the Civil Aviation Act.

7) Smaller, uncertified, training organisations have always been outside the scope of a SMS and we don’t believe this proposal is workable unless the CAA wishes to stifle growth of recreational aviation in NZ. Interestingly, when Part 115 came out, the CAA claimed that it did not require SMS for small operators. The size of the operations dictates whether they have “true SMS” or not. Hence there is no requirement for businesses having three or fewer aircraft to have an “organisational management system under 115.77c”.

Is it now the CAA’s intention to require all training organisations, including microlight clubs, to adopt a SMS?

GH: No – Refer response to Q1& Q2 above

8) It is our contention that the auditors will also act as the advisers. This would seem to be at odds with the current CAA policy, where auditors do not advise.

It would seem logical that those using a matrix to score the effectiveness of an operator’s systems should also have the expertise to interpret what they observe, including the professionalism of individuals, and the knowledge to impart in order to improve or correct things.

This raises the question as to whether the CAA has sufficient expertise to conduct audits of operational risk management systems across the range of sectors of the industry. Indeed, Part 115 certification entry audits use co-opted intra-industry experts.

In our opinion, a more valuable method would be to use a co-opted expertise for auditing and advisory purposes as normal practice. This means that CAA can be at arm’s length from it and purely provide oversight. Approved industry bodies or individuals should conduct the audits (as is the case with the new rules on adventure tourism operators).

Skilled auditors from within each sector of aviation would have the flexibility to interpret whatever systems are in place according to a defined list of requirements. It is envisaged that sufficiently qualified/experienced individuals from each particular sector would apply for registration as auditors. This would help circumvent another tier of CAA bureaucracy and foster recommendations, standards, and advances in best practice from within the industry.

We are very concerned that the CAA risks spending considerable resources and incurring large costs on ‘re-inventing the wheel’ when there are already excellent auditable standards for the implementation of safety management systems in all industries outside of aviation, including those with high hazards.

Is it envisaged that an industry-based peer group, appropriately registered, carries out the audit process?

GH: As a general rule, no. Safety audit and certification activities are core business for a government safety regulator. That said, where we lack specific expertise we will contract it in and will in all cases work with sector-representative bodies to achieve desired safety outcomes.

9) If the preferred option of introducing a mandatory SMS is followed, will the CAA delay implementation until EASA publishes its mandatory requirements?

GH: No.

10) Does the CAA have sufficient “operationally experienced and trained” staff to perform SMS audits on an industry-wide basis? How many are there?

GH: CAA will be building this capability as part of our SMS Implementation Strategy – Point 6 Training and Education

11) The backbone elements of SMS – hazard identification and a culture of self-reporting safety occurrences – will always be difficult unless the CAA is recognised to have adopted, and to actively practice “Just Culture”. This requires the Director to exercise his discretionary powers. It has always been incumbent upon the Director to fully convince the aviation community that the Director will always follow a “Just Culture” approach.

While wording of certain sections of the Civil Aviation Act (S.43, S.43A, and S.44) remain unchanged, this attempt will always be viewed with some cynicism, particularly in light of particular recent prosecutions.

Before a mandatory SMS is introduced, will the CAA seek to alter the wording of these sections of the Civil Aviation Act during the current review process of the Act that is being undertaken?

GH: The Ministry of Transport is considering amendments to the Civil Aviation Act, and matters pertaining to “just culture”, safety reporting, and sections 43-44 of the Act are included.

It’s time to bring Airways down to Earth

The circuit: It's simple, but now we have a towering problem

The circuit: It’s simple, but now – thanks to Airways – we have a towering problem

Everyone who flies within controlled airspace will have felt the effects of Airways’ increased charges. In many cases, it has doubled the cost of flying there. This is space that was created for the benefit of commercial operators and their passengers, and it is space that’s now far too generous for the 21st Century regional airliner.

Despite Airways’ protestations, it is clear that the arguments of every GA contributor to its “consultation process” were rejected. This only reinforced the widely held belief, following the CAA’s 2012 increases in fees and charges, that the consultation process is a charade and the conclusion is foregone. It is hardly surprising that Airways customers – already stunned by the CAA’s behaviour – sank back exhausted when Airways published its thick, glossy and costly review of charges earlier this year.

But the time has come to confront Airways and reveal the unfairness of its actions before the second of three planned annual price increases makes matters even worse.

The facts (and the recorded traffic) prove that an enormous volume of controlled airspace is visited by no one except low-level general aviators who inflict little expense on Airways. Controlled airspace in New Zealand is much too large. Yet, rather than undertaking (with CAA) a modernisation of controlled airspace – and drastically reducing it – Airways chose to exploit its territory and hammer a captive audience using the worn-out and palpably flawed principle of “user pays”, which has also been expertly manipulated by the CAA and the Minister of Transport, Gerry Brownlee.

There can be no better illustration of the damage Airways is causing than The Circuit.

I wrote an article about this, published in Aviation News, which was answered by Mr Ed Simms (CEO of Airways Corp) in that publication. He attempted to justify Airways’ dramatic price increases, using the usual and easily-spotted obfuspeak. I subsequently spoke to Scott Scrimgeour, who is the Manager of the Pricing and Service Section of Airways. He, naturally, also did his best to justify the increases (because he implemented them).

But those of us operating in the real world of general aviation know this:

♦ Airways said it received only 48 submissions from the thousands of Airways users and customers. To any reasonable observer, this indicates that there was either a lack of information provided to the GA community (which shows a faulty process of notification) or a resigned acceptance that “Airways will do what it wants, regardless of what I say”. Most pilots were unable to attend the advisory Airways workshops, because they were held only in the main centres. What Airways did with the 48 responses from those motivated to respond (which is to say, nothing at all) supports the belief that opposition may be pointless.

♦ Clause B on page 41 of the Airways Pricing Consultation Document confirms that every GA pilot and aircraft owner in New Zealand is now being penalised due to the claimed workload at only three airports: Hamilton, Tauranga and Christchurch.

♦ The SOE Act 1986 states that every SOE must demonstrate a sense of social responsibility and have regard to the interests of the community. To quote:

Part 1 of State-Owned Enterprises Act 1986


4 Principal objective to be successful business

(1) The principal objective of every State enterprise shall be to operate as a successful business and, to this end, to be —

(a) as profitable and efficient as comparable businesses that are not owned by the Crown; and

(b) a good employer; and

(c) an organisation that exhibits a sense of social responsibility by having regard to the interests of the community in which it operates and by endeavouring to accommodate or encourage these when able to do so.

♦ These new charges are socially unjust, penalising the entire New Zealand GA community to pay for increased services at only two airports. They are also unjust because they create an imbalance of costs for pilots/owners operating from airports or airfields in controlled airspace versus those operating in uncontrolled airspace. It is hard to see (and Airways has failed to explain) how increased Airways charges demonstrate social responsibility to either the wider supporting community of GA suppliers or the general public.

♦ GA pilots cannot understand how “flying the circuit” can be termed by Airways as a “complex high risk service” or be invoiced as an “intensive GA charge”. There is nothing more basic or simple than flying a circuit, and this exercise is an essential element of flight training. I mentioned to Scott Scrimgeour that Ardmore (which has the highest number of GA movements and circuits in the country) is uncontrolled and has the lowest accident rate. “Isn’t this proof that Airways’ statement is unfounded?” According to my notes, he agreed.

♦ Airways’ new prices have led to a large flight training operation in Hamilton (CTC) setting up bases at uncontrolled airfields such as Matamata and Whakatane. But this organisation’s activities at Hamilton are alleged to be one of the main reasons why the new charges were implemented in the first place. This is a classic case of Airways chasing the elusive dollar, while its clients more sensibly chase the most cost-effective solution.

♦ Airways states that the increase will be 15.7% over three years. So how has this resulted in my aerodrome service charges at Rotorua increasing by 88% since July 1, while my monthly Airways charges increased by 269% in the same period?

As a result of the new circuit and Airport Service Charge, which increased by 88% in Airways charges alone, it will cost an additional $1750 for a student at Rotorua just to reach solo status.

This is one irrefutable effect of Airways’ new charges. The net result is not a 15.7% increase but an almost 100% increase in circuit flight training costs.

Under the Airways charter, this SOE must demonstrate social responsibility. I believe that these new charges indicate a lack of social responsibility towards people who have no option but to operate from an airfield within controlled airspace.

In my discussion with Scott Scrimgeour, he quoted some surprising statistics. For example:

a. 60% of all activity at an aerodrome is due to GA operators

b. GA contributes only 5% of Airways revenue

c. 30% of aerodrome activities are circuits

I believe those claims were based on only three airports and are not nationally valid.

For pilots lucky enough to be operating at an airfield outside controlled airspace, these new charges will have a minimal effect. Not so for many others.

It is amazing that GA owners and pilots are not up in arms to get these charges opposed or reversed. Are there any others who feel as strongly as I do, or we all going to just lie down and take it again?

Isn’t it time for us to put pressure on the Government, our MPs – and especially on Airways? If we do not, New Zealand may become like Europe, where GA activity has been all-but destroyed by bureaucracy and absurd costs.

Steve Walker

♦ We will seek your views on this issue in the next GAA user survey.