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John Anderson and Ted Anson

John Anderson

No doubt you have all been interested in what's going to happen to CASA and to aviation safety in Australia. So, I'm going to tell you. Let me begin with the current chairman, Paul Scully-Power. He's asked not to be reappointed as a chairman of CASA due to his other business commitments, including his appointment by the Government to the Australian Trade Commission and the International Space Station Advisory Group.

I want to acknowledge that he has led CASA through a period of substantial change under his chairmanship. CASA has started to look outward; it's left behind the sort of timid and inward-looking nature that characterised the organisation when we inherited it from a previous government. He's done a good job and I thank him very much for it. The Government has appointed Ted Anson as chairman of CASA for three years from 1 July 2001.

He is currently, of course, the chairman of AMSA, the Australian Maritime Safety Authority, CASA's sister organisation. I mention in passing Ken Moss will take over as the chairman of AMSA. I want to say that Ted is ably qualified for this position. I appointed him to AMSA and I'm appointing him to this board for the same reason. I see him as a tough, independent minded and no nonsense chairman who embodies the qualities that I want to see in the chairmanship of CASA. Our aim over the last couple of years with CASA has been to create a period of stability. The past record with this organisation of endless changes in management and in oversighting arrangements I think was a hopeless impediment, and you know that has been my view for a very long time, to enabling the long-term reforms and so forth that we need in that organisation.

Cultural change, for example, takes a very long time to oversight. You have to be there long enough to get a feeling for the organisation, at least at management level, and you have to be there long enough to be able to drive the change based on a serious understanding of what's happened. So my policy, the Government's policy has been in stark contrast to the approach of the previous government where we had almost continual conflict. It is worth putting on the record that in less than seven years there were four chairmen, four chief executives and six heads of safety regulation. Quite a few different ministers as well.

I want to say this: Notwithstanding what I said about my commitment to long-term stability, one of Ted's briefs will be to review whether the existing board structure is appropriate for a safety regulator with enormous enforcement power. So he will report back to the Government in the middle of next year or thereabouts, the final date to be established, on whether the governance arrangements for CASA are indeed the most appropriate, and I reiterate that I have not seen that as the primary issue. There have been endless reviews into CASA, endless reviews. We know where the strengths are, we know where the weaknesses are, we know what needs to be done. The issue here is whether the governance arrangements really are the most appropriate now for ensuring that what we know needs to be done is well and truly taken forward.

So, in short, Ted will report to the Government on whether CASA should remain a statutory authority with its own board or whether it ought to have new reporting arrangements along the lines of the Australian Federal Police or the Australian Customs Service. The Government has reappointed Mick Toller for another three years as Director of Aviation Safety. Over the last three years we really have seen substantial improvements in compliance, in surveillance. We have seen the successful oversighting under Mr Toller of Australia's Y2K compliance program for the aviation industry.

We have seen, for example, in difficult issues CASA's response to the Avgas contamination issue in December 1999, January 2000, where Mr Toller's decision to ground all of the affected aircraft was admittedly not popular but ensured that no lives were lost. We saw, of course, and we have seen, the tough action in relation to both Qantas and Ansett reflecting a regulator willing to do what is necessary. It is my belief that Mr Anson and Mr Toller can and will work together very effectively. Ted has confirmed his view that he feels strongly that this is an appropriate course of action for continuing the reform of CASA.

The next bit that I want to cover is very important. It is something I have had extensive conversations with Ted about. I will be issuing the Board with a new charter letter, an updated charter letter, after the Board, under Ted, has undertaken a round of consultation with the industry and in particular with the GA sector. I want to say that I hear the concerns from the GA sector. They want better consultation on regulatory reform, they want to ensure that the regulations when they are rewritten really are workable for them; they want an increased emphasis on industry training and education.

So, Ted and I have agreed that he will coordinate a series of field visits with those people who are concerned in the GA sector, including in the north of Australia. I see that as very important. It is an area where we need to work to ensure that the regulator, and let me restate this point, which has very substantial powers indeed. I hear a bit of speculation around about why it does not prosecute, for example. Well, we do not let our organisations prosecute directly but they can recommend to the DPP that prosecutions be undertaken, and they do. So, with all of those powers I want to say that yes, they have a very important role to play and should exercise those powers when necessary but they should also be seeking to develop the most important thing of all which is a culture of safety.

John Forsyth made an interesting observation to me the other day. He said, "If a culture of safety is working properly, the aviation industry will report its problems." And ironically, one of the things that is often misunderstood is that it can be the very airline operator that doesn't report problems that's not particularly safe because they are not coming clean. We want to develop a culture of cooperation and a commitment to improving safety, remembering that, as no other sector in transport, aviation is a transport sector that has a very great interest, commercial interest, in maintaining its reputation and standing for safety.

On that note can I say there will be the charter letter to come, there will be some further developments in relation to the ATSB and also to air services in due course. I look forward, very much, to Ted's stewardship of this very important role. Over to you for questions. Aviation first please.

Question

Just to start with, the Toller reappointment: Where is Mr Toller today and why was it left so relatively late in his contract? Is it a sense in which he had to stew on his reappointment until three weeks?

Mr Anderson

No, not really. I'd been carefully considering the matter, but no, there's nothing to be read into that. It just takes a while to get these processes, all the ducks lined up. I wanted to make certain that I was hearing the broader issues from each of the sectors as well, particularly GA. I really do want to emphasise that I want to build a more cooperate and productive culture with GA. They have got to understand that the community really does expect a tough regulator but on the other hand they have the right to be heard and to enjoy a civil relationship with their police, if you like. That's an area where I wanted to make certain that I'd really heard what they were saying and certainly I've had plenty of input on it. Then it had to go through due process with the government. Part of that, of course, is I wanted to talk to Ted about how he felt about it and where he wanted to go.

Question

The general aviation sector is wanting better consultation, Mr Anderson. Can that be viewed in any way as criticism of CASA in the past?

Mr Anderson

I have never said that CASA is perfect. Never said that at all, but I do believe that it's headed in the right direction. We're getting compliance and surveillance levels up and, we've seen the successful execution of a number of difficult tasks. I mean, the Olympics went without a hitch. Aviation safety is a little like eyesight. While it works it's easy to overlook how well it works. When something goes wrong, we often have a very emotive reaction. Can I say to you in some ways the easiest thing of all for a transport minister to do when a body like CASA is under attack, is to say, "We'll have a review". That stalls everybody for quite a while. Then you say, "We'll have a restructure" and that stalls them for longer while you say, "We're letting the restructure work".

For better or for worse, I've always taken the view that I wasn't going to be that knee-jerk sort of minister. I was going to give people the time to work it through, I was going to put the acid on them to make it happen but I have wanted to take careful stock of where we've got to and we've made good progress in a lot of areas. I've indicated the areas that I think need improvement, and you will remember that not long ago I announced that we would be having an independent review as well, of how we handle service bulletins from the manufacturers in this country, given that in 1991 after a review of resources it was decided that we would not mandate service bulletins in this country unless the certifying safety agency in the country of manufacture of the aeroplane did so and that has proved, I think, to have been a little unsatisfactory.

A classic example of that being the way in which 767s are used in this country, particularly by Ansett, which is a little unique and so we have got a review of that going on. I have already said that the regulatory review program has been held up until we have worked out how to get better and more sincere consultation with industry. Let me make this point about industry. Whilst the regulator's primary task is obviously safety, we want to make sure that the regulation of the industry is done in such a way as to ensure that we maximise the chances of growth of the industry.

Question

How seriously did you treat the fact that Mr Toller has been counselled for three breaches of air safety regulations in your considerations of the appointment?

Mr Anderson

Very seriously. Obviously I took them seriously but I do remind you that we had Tom Sherwood, you know the former chairman of the NCA, have a close look at this and determine that in his view, if there were any erring here it was that Mr Toller was treated in a tougher way than anyone else would have been.

Question

How confident are you that Mr Toller and Mr Anson can restore confidence to Australia's skies?

Mr Anderson

Very confident as long as we get rational reporting and coverage of what happens. You have only got to look at the statistics. Look, I compliment most of you, all of you here, of course, on your coverage of these things, but you've got to look long and hard at our actual safety record in this country. It is very easy to make emotional claims about a decline in safety record rates. It is not true.

Question

But that's the important thing to look at, isn't it, the last year?

Mr Anderson

No. Confidence (inaudible)

Question

Whyalla, Ansett, regardless of (inaudible)

Mr Anderson

Well, the ATSB report on Whyalla is not out but you've got to contrast what's happening here with, say, America. We're right up there with the best. Our accident rates have generally speaking been coming down. Now, one of the things that I have carefully considered is the need not only for safety standards to be maintained and improved but for public confidence in safety to be maximised. That is why I believe that Ted who is, as you can see, is calm, deliberative, focussed and absolutely no nonsense, will bring just the right demeanour to this very important task.

Question

Mr Anderson, haven't you got a couple of other vacancies on the board?

Mr Anderson

Yes, we have.

Question

When are they going to be filled?

Mr Anderson

Well, to be quite frank, I mean I have some ideas, but I felt, given that I knew there was a change in chair coming up, I should consult with the new chair first.

Question

It's been quite a while, hasn't it?

Mr Anderson

It has but I wanted to ensure - I mean, I think it's appropriate for the chair, whether it was to have been a reappointed chair or a new chair, to be consulted on that matter.

Question

Mr Anson, can I ask you from your perspective at AMSA during the Ansett 767 crisis how do you think CASA handled that issue? Particularly how do you think CASA handled the treatment of Ansett in the public, in the media? We have had Dr Scully-Power already say that maybe they could have treated Ansett a little more sensitively. What was your opinion as an outsider at that stage?

Mr Anson

Far be it for me to criticise the previous chairmen, I see myself not qualified to do that. In AMSA maybe we would have done things a little differently. We will be studying the way that the board in particular, that is my focus, the board in particular handled this and what support they gave to management, including the director. I have a lot of confidence in the director and that's why I guess basically I took the job. I didn't apply for it. I was quite happy in my current life. I am a safety orientated person. I came out with BHP and I believe BHP in their workforce are quite leaders in safety. As I say, the board will be studying, the new board.

I would just like to pick this young lady up here on vacancies on the CASA board. Under the Act the CASA Act, there is a minimum of four directors and a maximum of seven so we comply currently with the Act and that will be studied to see - you don't put people on boards, or I don't put people on boards just to fill up the maximum commitment. We will study it and see if there's any person that can bring further stability and health leadership to the organisation. That's what we will be looking at. I will confer with the minister at the appropriate time.

Question

Mr Anson, you say you've got a lot of faith in the director. What do you make, though, of his personal style? He does seem to have offended people and people have left the organisation on less than happy terms at times. Is that par for the course?

Mr Anson

No, it is not par for the course. I'm taking you on face value saying that.

Question

Well, there's the Foley case.

Mr Anderson

Well look I'll intervene at that point and say that I don't think that is a reasonable line of questioning. There's a lot of background that Ted might reasonably be given time in that particular case to look at but if you really want to know the period when a lot of good people left CASA, look elsewhere.

Question

Mr Anderson, on general aviation you are obviously wanting to get out and start talking to people in GA.

Mr Anderson

Which I have been doing, I might add.

Question

Yes, yes.

Mr Anderson

Not only in general aviation, but everybody.

Question

But the relationship with general aviation and CASA is something that seems to get a lot of discussion amongst the GA community. How bad do you think that relationship is and where do you think that you can improve matters?

Mr Anderson

Are you addressing that to me?

Question

No, Mr Anson.

Mr Anson

Well, let me say I've been on board for about six hours now. Give me time and I'll come back and answer that question to you. Leave your name, rank and serial number with me and I'll make sure I get back to you.

Question

And what about your review of board structure?

Mr Anson

Yes. Not of board structure. Whether the most appropriate government arrangement is board. That should revert to, as has been the past practice, something that's under the purview of the department directory. That's specifically an issue, not whether the board structure is right but whether you have a board or whether you don't.

Question

And what sort of - have you got any thoughts at the outset of that?

Mr Anson

Well again boards of government authorities work not only by their Act but also under the CAC Act and under the CAC Act, if you would care to read it some time, and you may have already read it, it is spelt out pretty clearly there about governance and what boards are and expected to do. I will be introducing - I do not know if it is there or not - as I say, six hours on the job, not even officially on the job - that doesn't take place until I think in the press statement at the end of June. That will be one of my main focuses to make sure that board is operating like my current board, which is nothing marvellous, there's no secrets or mirrors or things. It's just complying to the Act, that we have to do, or we can be fined big time.

Question

Mr Anderson, when were you informed of Dr Scully-Power's decision not to seek a new term as the chairman? How long?

Mr Anderson

This whole thing started last week.

Mr Anson

And in fact it was - I thought I drove my minister mad, actually, because I was in transit from Tasmania. I'd been down there on AMSA business with my board and I was driving back. I live in Queensland and I was driving from Sydney to Queensland when I got the call and I lost him about four times and I thought this is not the right thing to do with your minister. I mean he's a pretty busy sort of boy. So, what I did was pull off the road and we spoke for three quarters of an hour. I think it was a pretty clever trick of his to a ruse because I had to return his call and that meant I was paying for the phone call and my phone expenses are split between the Australian National Line that I still am running and AMSA. So I think the Minister saved CASA quite a deal of money.

Mr Anderson

I had spoken to Paul Scully-Power before that. We spoke regularly and I gained the feeling over time as to how I was to play things and so did he. He's actually had some recent appointments which keep him very busy and I don't want to detail the nature of those conversations. I just thank him very much for a great job and look forward to the new era of driving things forward as he helped CASA through a very difficult and traumatic period. You all know how traumatic it's been and in the interests of aviation safety and the travelling public we've got to settle that down and make sure - I mean the point you raise is entirely legitimate - I want the travelling public to have confidence in aviation safety. Now, there are a number of players who will have to pull their weight in that. They are not only in CASA and I look to other people that are involved in aviation safety bodies in this country to ensure that their comments are reasonable and balanced and fair and actually have regard to the facts.

Question

Minister, can you say which incidents in particular have caused you to question whether a board structure is appropriate?

Mr Anderson

As you know, and I really want to be quite clear about this, I've always been of the view that it is not the primary matter. I think I've actually used the language before. I don't think it's the architecture that's the real issue. It's the players within that architecture and the way they fulfil their role. I've long had the view that almost any structure will work if you've got the right people driving it but I do think it is now appropriate because quite a few people say to me, "Does the board add enough value?" You know it was put there originally of course to put some distance between the Government and the regulator. That's why it was done by a previous minister many years ago.

It's appropriate to have a look at that. I mean in a sense I still end up wearing it anyway so maybe that reason is not terribly relevant any more. I just want to make it plain that's what I'm looking for; we know what needs to be done with CASA, we know where it needs to go, where the problems are and all of those sorts of things. It's whether the Government's arrangements are most appropriate for driving that furtherest and fastest. That's really what I meant.

Question

In reappointing Mr Toller, did you have certain conversations with him where you thought he could pick up his game or needed to keep his head in to avoid controversy, which seems to follow him around?

Mr Anderson

Look, I have confidence, as I've made very plain, in Mick Toller. I would not have recommended him for reappointment and taken it forward otherwise. Just as all of us occasionally have moments when we think, "Was that handled as well as it might have been in the public arena" or what have you. Of course we talk about those things. I'm not going to deny that and by virtue of what I said today, I said for example, I think we do need to improve consultation with the GA sector.

I think whilst, of course, the role of the board is governance, not day to day management - we have had troubles with that in the past, too. The general sort of culture and trend setting of the organisation depends very heavily on the chair and one of the things I was looking for was a chair that I believe would have a great capacity to go and relate to real Australians who love flying their aeroplanes as charter operators or GA or whatever they are, scattered around this vast country of ours.

Question

Mr Anderson, you touched briefly earlier on the Whyalla crash. Are you aware of these leaked documents that suggest that CASA did give approval to the airline to extend its engine life? That's a claim that Dick Smith is backing.

Mr Anderson

Yes it is, isn't it? Another one of those claims didn't apply to this aeroplane. Both the engines on that plane were well within their service life, in fact one had been overhauled only a matter of a couple of hundred hours beforehand, the other one was well short of its 1800 hours. I just say this is a matter that, as you know, is the subject of a draft ATSB report. You know, and this talk about blood on hands and all this sort of stuff ought to be treated with the disregard that it deserves.

We have a professional independent safety investigator in this country. They too, I respect their independence, but I do make the point that they, too, need to think about how they instil public confidence in aviation safety as well. We all have a role to play in this. The minister has role, the board has a role, CASA has a role, CASA operatives have a role, the ATSB has a role and its operatives have a role.

Question

Do you have any aviation experience and do you think your background might make you vulnerable in the industry as vindictive sometimes as aviation can be, particularly over the last few years? What's been your direct aviation experience?

Mr Anson

I was waiting for this question. When the minister first approached me about it my first comment to him was that "I don't know about this. I have nil experience in the aviation sector. In fact I wouldn't even know what tyre pressure you put on a jumbo." He said to me that you'll hardly be called on to look into that but if so; to answer your question bluntly, no, I have no aviation experience. As the minister said, I'm not there to run the day-to-day business of CASA.

We have a very strong management team that will do that under direction and guidance from the board who has aviation-type members sitting around the table and should there be, and in fact this lady's question about opportunities for new directors to come on that will be looked at and if we find we need to stiffen it up in that area I'd be coming back to the minister for guidance. Aviation experience, no, but it's amazing a guy called Don Argus from BHP, he's never dug a ton of coal in his life, much less dug a ton of iron ore, but by gee he knows what to do with it when he's got it. So, that's the sort of thing I'm bringing to this board. I don't know much about aviation. I'm not a Don Argus but I believe he's on the right tram and I hope to do exactly the same.

Mr Anderson

I just make a general comment that one area where my thinking has evolved is that there was a time when the government talked a lot about a board of aviation experts. I started to move away from that quite early on in my tenure as a minister. I see the board as responsible for governance and the setting of directions and culture. Those are management and government issues and, as I say, I go back to the words I used earlier, I was looking for somebody tough, independent minded, calm and no nonsense.

Question

Mr Anderson you said that you were planning some developments in regards to the ATSB and the air services. Can you indicate what they might involve?

Mr Anderson

Just in very general terms, there are certain matters to ensure that the proper independence of the ATSB is preserved, that its interaction with other bodies is managed appropriately because that has an impact on confidence, you see, as well. In the minds of the travelling public in relation to Airservices, which I have to say - it's easy to concentrate on the negatives in aviation. Airservices, you know, has really gone incredibly well. Its board is strong, the management is strong and what have you. They're very keen to move ahead with the government's broad policy of corporatisation.

As you know, there have been some obstacles there in relation to contestable services for the outsourcing of things like fire fighting services and tower services and I want to bring forward some positive policy development so that we can move that organisation more effectively down the road to corporatisation and I'll be saying a bit more about that some time, along with the charter, in due course.

I do not want to revise that charter until the chairman has had a chance to get into the seat and communicate, not only with Mick Toller, as I say, and his management team, but also with those who have to interact with that management team and their operatives out in the field.

Question

Any reason why Mick Toller couldn't be here today?

Mr Anderson

No, not at all. I mean you all know Mick. It's as simple as that. You know Mick but I wanted you to meet Ted. I wanted you to have that opportunity to see why I've appointed Ted to the role.

Question

Have you heard anything yet from the ATSB about when we might see the final report on the Whyalla crash?

Mr Anderson

Look, it's not very far away but they are actually such an independent organisation and so independently minded that they neither have to tell me nor do tell me and occasionally, of course, I get the same surprise as everybody else does.

Question

(inaudible)

Mr Anson

Could I have your name please?

Question

Verona Burgess from The Canberra Times.

Mr Anson

Christian name?

Question

Verona Burgess.

Mr Anson

Verona? Verona, I don't want to keep saying this young lady all the time. Verona, talking about the board and vacancies etcetera, etcetera, you may know, or you may not know that the deputy chairman of CASA, a guy called Kimpton, James Kimpton, ex Ansett man, works for me on the AMSA board. He's a member on AMSA. We interact very, very well. He's brought quite a lot of skills out of CASA to my board and I think he has taken a few back to CASA and hopefully, I can't speak for my boss here but hopefully that will continue and we'll still be able to interact with both boards.

Question

I was going to ask you, with regard to the board I seem to recall when it - statutory authority was first formed that one of the major problems had been the industry feeling the lack of input, you know, and they were always complaining that they didn't have much input. If you were going to abolish this structure, what would you do to appease those concerned?

Mr Anderson

I think that's a real issue. It's one which Ted will have to look at as part of his review. That is going to be - I think it's an important issue, frankly, that has to be worked through. As I say, CASA has, contrary to some of the rhetoric you hear around the place, it has enormous enforcement powers. This idea of an organisation that can pull you out of the sky somehow or other lacks teeth is something I do not understand for the life of me. If they can impose fines of up to $231,000 and what's more they can do them on a multiple basis, they can impose prison terms - sorry, seek prison terms of up to seven years. It's just that we don't normally allow our authorities to prosecute in their own right.

It normally goes through the DPP and I think that is appropriate, frankly. I wonder how many complaints I'd get direct on my desk if one of the authorities under my purview did not go through the DPP. I think would create more mayhem and difficulty. But, at the same time, one of the things that an organisation like this has to do is to ensure that it is dealing, you know, in a spirit of cooperation and courtesy with those who want to do the right thing. That's how you build a culture of safety. You've got that big walloping stick in the back pocket or several big sticks if you've got to use them. But, so far as possible, it's incumbent upon all of us to interact on the basis of respect for and assumption of innocence until proven guilty with those people that we have to interact with.

There is no less the case even for a regulator. One of the great divides in opinion is over those outside aviation who say CASA should be tougher and those inside aviation who say CASA is too damn tough. There is a very clear divide there. So, industry input I see as very important and that is one of the things that I wanted to work through Ted was a process of consultation. He's got some good ideas. I've outlined all that I want to say because I do want to send that message to GA. He'll be out circulating, organising some field trips, listening to those people.

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