Building the new CASA - a check of the scorecard
Building the new CASA – a check of the scorecard
Aviation Law Association of Australia and New Zealand
Avalon, March 2007
Two years ago you invited me to say a few words at your Avalon meeting. My topic then was ‘Australian Safety Regulatory Developments’. At that time I had been a bit over a year as CEO at CASA. Much of that initial period had been taken up in building an understanding of the organisation, talking to people both inside CASA and in the aviation industry, deciding what was good about the organisation and what needed to be changed, then developing a plan for that change. When I last spoke to you quite a few initiatives were underway, but most were just at the starting gate.
Since you have been kind enough to invite me back, it seems sensible to give you an update—where we have got to and what remains to be accomplished.
Given that my comments last time focussed on regulatory development, I should probably start this check on progress with that subject, although I may later cast the net a little wider.
First some background. To put it bluntly, CASA and its predecessors had a long and not so proud history of rule writing. There had been a number of regulatory re-write initiatives over the last decade or so, and each has failed to reach fruition, for a variety of reasons. There was another such re-write in train when I joined CASA at the end of 2003. In this case, after a few years of mixed progress a major effort had been made to fast-track the bulk of the program.
Unfortunately, the effort to get it done in the required time-frame had increased the risk that the quality of the rules that were emerging would be compromised, that the goal of ‘Safety Through Clarity’ would not be met and that the new rules were less to do with safety outcomes and more to do with control or prescription.
I also had doubts as to the quality of the consultation that had taken place. So, as some of you are aware, one of the first things I did after arriving at CASA was to issue a series of directives which effectively put ‘on hold’ the so-called ‘operational’ package of the new regulations, pending a review to be undertaken by the Standards Consultative Committee, a body whose members are drawn largely from industry to advise CASA on regulatory issues.
This was likely to be the last chance we had to get the rules right and I made no apology for slowing the process, and even suspending it, until we could get it right.
The new guiding principles were for regulations which were to be:
- Based on known or likely safety risks
- Drafted to specify the safety outcome required, rather than detailed requirements to achieve that outcome
- Within a two tier framework – the Civil Aviation Act, and the Civil Aviation Safety Regulations, supported by advisory and guidance material where needed.
In short, I wanted to get our regulations back to where they needed to be, and with a clear safety focus.
Also, I am interested in safety outcomes, not necessarily in the way those outcomes may be reached, which can be many and varied. This is the approach adopted by the European Aviation Safety Agency, and I will refer further to that in a moment. The prospect of having the flexibility to meet the requirements by a means of one’s own choice appealed to some, but the concept was not universally embraced, as many in our industry like to be told what to do, literally ‘doing it by the book’. Such people are catered for in that the new style regulations will be supported by an advisory method of compliance. In other words, if you adopt this method you will satisfy the regulatory requirement (and satisfy CASA). But if you have a better process, one that works better for your organisation and achieves the desired outcome, then we will be happy to check it out, and if we agree it works, approve it as an acceptable means of compliance.
Implementation of the new guiding principles was established through Directive 16 of 2004 and were given support by the establishment of a new set of review bodies, the Regulatory Advisory Panels or RAPs, in addition to existing consultative arrangements. Membership is a mix of CASA and industry representatives, plus a representative from the Department of Transport and Regional Services. The distinguished Chair of this meeting [James Kimpton] is also the chair of two RAPs.
The need for new regulations to meet the new guiding principles initially slowed the regulatory development process, but there is no question that better and more effective safety focussed rules have been the result.
Underpinning the Regulations
I mentioned earlier an ‘acceptable means of compliance’ which might be developed by an operator. Behind this is what I believe to be an important fundamental of aviation safety. CASA can make rules and regulations until it is blue in the face, and engage in comprehensive consultation and checking processes, but it is the operator that has to apply the rules, or not, on the day. CASA cannot be everywhere all the time. We do a lot of that, but ultimately it is the operator who has to take day-to-day responsibility for safe operations. That is the reality of aviation safety.
That is why it is so important for operators to be able to define for them-selves the risks involved in their particular operation and to have a safety system in place which is able to manage those risks.
This is not to suggest that a joint approach to aviation safety between CASA and the operator should mean a diminution of CASA’s independent role as a regulator and maker of the rules. There is no lessening in the need for members of the industry to comply with regulatory requirements—the industry must continue to comply with the Act and the Regulations as a minimum requirement, and we will continue to enforce that requirement.
A good example of the coming into effect of this new approach to rules development is in Civil Aviation Order 100.66 which took effect in February this year. These are the first of the rules with a regulatory style similar to that proven by the European Aviation Safety Agency (EASA). The new CAO offers the option for Australian aircraft maintenance personnel to obtain licences and ratings based on EASA categories. It also involves recognition of specifically approved maintenance training organisations operating under detailed, self-prepared, expositions setting out their training objectives, resources and capabilities. Eventually these licences and approvals will come under CASR Parts 66 and 147 respectively. This CAO is intended to provide access to the new licence categories in advance of that legislation.
There is no requirement to transfer to the new licence categories. These new licences are available in parallel with the current licence structure. They are simply being made available for those organisations or individuals who can benefit from them. The rule set arranges for organisational outcomes rather than approvals and the Approved Exposition is used for detailed oversight. In this regulatory style, an organisation gives an exposition to CASA which details how the organisation will conduct its operations and maintain the desired level of safety. Once the exposition is approved, CASA oversights the organisation to ensure it continues to operate in accordance with the approved exposition.
The Maintenance project proved to be a good test of the concept of a small CASA/industry team working in a focussed way to develop a rule set, while at all times wider industry consultative processes were followed. It is an approach we plan to maintain in other regulatory development programs.
Another really good example of our new approach to regulatory development is in the production of something that is not a regulation at all, although it will certainly be reflected in regulations. It is the Classification of Operations. There is a need to define broad operational categories, an apparently simple enough task, but one that tends to go off the rails when it comes to working out what specific activity goes into which category.
So we again took the ‘small team’ approach. A small industry/CASA panel was established along the lines of the Maintenance rules model. However, in this case the task was as broad as it could be, covering the entire range of aviation activity, so it was much more than a need to find subject matter technical specialists and locking them in a room to write draft rules.
There was still a broad industry consultation process that needed to occur, but the ‘small team’ approach minimised the bureaucratic processes and allowed a clear focus on the key issues. The result, I am pleased to say, has been excellent. I believe that in the new Classification of Operations we have a document which places Australia at the forefront of progressive thinking on defining aviation activity in a manner consistent with this country’s aviation safety priorities, and in the small team approach I believe we have a process that produces first class outcomes in reasonable timeframes and with a minimum of fuss.
New Enforcement Tools
While extolling the value I see encouraging industry to actively manage its own safety risks, I tried to emphasis that CASA will never walk away from its responsibility to ensure compliance with the regulations and to take appropriate enforcement action where that is required. Indeed, we have a clear requirement under the Civil Aviation Act in ‘developing enforcement strategies to secure compliance with relevant legislation’. I should therefore say something about the progress we are making in refining and improving the various enforcement tools we can make use of.
This is an array of tools that have only been fully available to us since February 2004 with the introduction of a number of legislative changes. Those changes included the demerit point scheme, Enforceable Voluntary Undertakings, the Automatic Stay process, and the procedure of requiring judicial confirmation of CASA’s decision to immediately suspend an authorisation on grounds of serious and imminent risk to safety.
Without removing ultimate responsibility from our senior operational and technical managers for decision-making involving the variation, suspension or cancellation of civil aviation authorisations, we now have an internal protocol that requires that, as soon as it becomes apparent that a breach may have occurred, and that enforcement action of some kind may be appropriate, the full range of enforcement responses will be canvassed, and a course of responsive action will be determined on the basis of achieving the optimal safety outcome consistent with the requirements of the law.
We are actively seeking better communications and more regular and formalised relations with other state and Commonwealth regulatory authorities with responsibilities that touch on aviation-related activities. This includes occupational health and safety agencies, environmental and agricultural authorities, fair trade and consumer protection agencies and, of course, state and federal law enforcement authorities. Where matters come to CASA’s attention that may more effectively be dealt with by such other agencies, efficient processes for referring these issues to those agencies are being developed and implemented.
With the cooperation of the Australian Federal Police and a growing number of air carriers, we have already introduced effective processes expediting enforcement action against intoxicated and disorderly passengers, passengers who smoke on aircraft, and passengers who fail to adhere to an air operator’s lawful directions. We have also arranged for a potential air safety issue to be investigated by a State Occupational Health and Safety body, in a situation where CASA’s authority to investigate was limited.
For the same reasons CASA’s approach to safety and safety-management is coming increasingly to be guided by modern scientific research and analysis, our approach to enforcement—what works, and what does not, when, where and with whom—needs to be similarly informed. In this connection, we will be developing analytical tools that will better enable us to identify and employ the most effective enforcement responses, and to target our enforcement activities more efficiently.
A number of other innovations have been or are in the process of being introduced, which are designed to enhance the effectiveness, efficiency, consistency and fairness of our enforcement-related activities.
One example, though hardly radical, is a step towards simplifying something that has presented difficulties in the past. Show Cause Notices, where we invite an alleged perpetrator to give us reasons why we should not take action against them, will now be accompanied by a brief ‘executive summary’, explaining in plain language the basis for the administrative action CASA is contemplating. We have found that an operational manager receiving one of our necessarily voluminous and legalistic show cause documents has difficulty in comprehending it (amazing though this may seem to this audience) and quickly passes it to their legal advisers, who then, quite reasonably, develop an equivalently voluminous and legalistic response, and the matter then commonly proceeds to barristers at 10 paces, with the attendant grief, delay and financial pain. We feel that the availability of a simple statement of what is at issue might allow, at least in some situations, a manager to make a better informed judgement on how best to respond, whether that be by way of the full legal defence route, or by a negotiated settlement, or some other course of action. We see this as a step towards offering greater clarity.
In another related initiative, where CASA takes a decision to vary, suspend or cancel an authorisation more than 6 months after the show cause process has been completed, affected persons will have an opportunity to bring to CASA’s attention—before a decision is taken—new and relevant matters that have arisen in the interim, and to raise again matters they can show were not fully or fairly considered in the first instance.
Where CASA has taken a ‘reviewable decision’ and that decision has been appealed to the Administrative Appeals Tribunal (AAT), CASA will be willing to immediately consider any legitimate submissions on a possible alternative decision, rather than wait out the AAT process. Such an alternative proposal, if agreed by CASA, could be put to the AAT, and if accepted could eliminate in many cases the need for lengthy and expensive proceedings.
Work on the development of Part 13 (Enforcement Procedures) of the CASRs, which has been on hold for a long time, will soon resume, with appropriate consultation with those in the industry with particular interest and expertise in legal and related regulatory procedural areas. The delay in getting Part 13 back on the rails has not been a major problem because most of CASA’s enforcement procedures are governed by wider Commonwealth policy, practice and law, which are reflected in current provisions of the Act and the Regulations. However, it is time to reactivate this important work.
We have been through signifigant organisational changes at CASA, and I should say that our Legal area has not been immune from such change. At the risk of introducing an element of controversy amongst this eminent group I can say that when I arrived at CASA I found the balance between the role and responsibilities of our legal people and our operational management was a little out of kilter. Although our legal headquarters was in Canberra we had legal people in a number of our field offices as well. It was of course operationally convenient to have legal expertise ‘on the spot’ rather than having to consult with head office. However, a tendency had built up for some of our operational people to say when a problem arose ‘this could end up in court, so I may as well get the legal options at the outset’. And doing that was easy, with a resident lawyer on the premises.
In the absence of instructions to the contrary, the legal response was often in terms of, for example, what might be the best option to secure a prosecution. So what we had was an institutionalised structure that in some cases took us down an adversarial track when other options may well have been available to achieve the desired safety outcome. I believe the best balance is struck when our operational people have responsibility and accountability for examining a situation, determining the desired safety outcome, coming up with a what they consider the optimal course of action to achieve that outcome, and then take legal advice, if necessary, on how to implement the action, or to establish whether the proposed action has legal problems. Of course, I do not expect our operational people to have detailed legal skills, but I do expect them to have sufficient understanding of legal principles to know when to seek legal advice. And I do expect them to have the ability and willingness to exercise their own professional judgements, drawing on legal support when they consider that to be required. If this sounds somehow a reduction in the standing of legal services in CASA, that is not so. We have a very professional team and they provide wise counsel and astute advice. What I am looking for is for our operational managers take responsibility for the operational issues, and then take a considered view on the level of legal involvement required, rather than automatically calling in legal people as a ‘knee-jerk’ reaction.
So, on one hand we have emphasised to our managers that they are there to manage, and should not be avoiding that responsibility by effectively passing it to others. On the other hand we have scaled back our field office legal representation. Legal advice is of course still available from Head Office to support our people in the field, but they need to first work out where they want to go in terms of the operational issues and outcomes, and then call in the legal cavalry if they are needed. The net result has been a modest reduction in the overall legal team, but a more standardised system.
We have also dropped the Legal Counsel position in place of the position of General Manager Legal Services Group. Again, this is intended to indicate that the legal function is there to support management, not to drive operational policy. Dr Jonathan Aleck, who many of you know, and who is with us today, has been acting in the position for some time and I am pleased to say that he was recently confirmed in that role on a permanent basis. He will do a terrific job.
So far I have focussed on our progress on regulatory development, and developments in our approach to enforcement issues, both topics of possible professional interest to many among you. But I said I would cast the net a bit wider.
There is no point in having a major change program in an organisation like CASA without having some clear goals. In our case the goals are to:
- Achieve safety effectiveness
- Improve efficiency
- Improve industry relations
- Improve accountability.
I won’t try to cover all the changes we are making to achieve these goals but it would be useful to touch on some.
Let me first say something about our people. CASA has always had good people, many of them highly professional, well qualified, with long experience in a wide range of aviation disciplines. But there was an issue as to how we used our people and the limited range of skills we had to conduct comprehensive surveillance.
So what changes to the workforce are we making?
Perhaps I should start at the top. Those of you that have regular dealings with us will have observed a progressive refreshment of the entire senior management team. In my view this is an essential component of an organisation that is required to change. A refreshed management team brings new talent and enthusiasm and broad based experience from the aviation industry as well as the wider private sector. And to strengthen that team even further, I recently appointed a new Deputy CEO Strategy and Support, with a key responsibility of getting CASA’s service delivery up there with the best.
We have recently been recruiting a new type of CASA inspector, the safety system specialist. Their role is to oversight the safety performance of operators, their safety management systems and the operator’s senior management responsible for those systems. These specialists compliment our technical inspectors and bring more of a focus on systems. I expect to recruit more of these system safety specialist over time. This is an example of the need for a regulator to adapt to a changing environment. If we are going to put emphasis on Safety Management Systems to better manage safety risks, we need people specialising in that field.
We believe we can give better support to some parts of the industry by the way we deliver safety education and training. This is very important because I believe safety education and training, in some industry sectors, is the best way to achieve safety outcomes. Our traditional approach to education has been to host large-scale safety seminars at various locations and invite people to attend to hear whatever message was current. If you ever went to these seminars you typically saw the same faces and I always used to wonder about those that never turned up – these were the ones that probably needed to hear the message the most.
Our approach now is to take our educational programs to where aviation people work. We have appointed 6 Field Safety Advisors who are assigned particular geographical areas initially on the east coast and their job is to conduct regular site visits with ‘their’ operators. This activity is clearly separated from surveillance.
These people are expected to spend their days out of the office, working hand-in-hand with industry to achieve positive safety outcomes by addressing real, not imagined risks which have been identified through objective research and analysis. Our hope is to be able to give industry, where they need it, the tools and knowledge to improve safety in their own organisations, as well as opening up and maintaining direct communications between CASA and industry outside the surveillance/audit structure.
We have established the Industry Complaints Commissioner to examine complaints against CASA that cannot be resolved through normal channels. The Commissioner does not replace other avenues of appeal, such as the AAT, the Commonwealth Ombudsman, or the courts, but offers the aviation industry an easily accessible, low cost, timely and open means of getting CASA decisions reviewed. The Commissioner operates as independently as anyone can and still be under the CASA umbrella, and the position reports directly to me. The process is working well, and I have already approved a number of the Commissioner’s recommendations which have come out in support of industry complaints. It is my hope that the Commissioner will have a declining role because our reform program will progressively reduce the number of unsatisfactory decisions we take and the complaints that follow such decisions, but that is an outcome that may be a little way off.
Changing Organisational Structure
In the operational area of greatest relevance to the smaller scale sector of the industry, the General Aviation Operations Group, we have abolished virtually all the Canberra based positions, and have established a range of new positions at the Group headquarters in Brisbane, and at a number of our field offices. The aim is to have our people in locations where they can make the best contribution to safety.
Similarly, in the Air Transport Operations Group, principally involved in larger passenger carrying operations, we have abolished most Canberra based positions, with new positions being established at operational centres, largely in Brisbane. The aim of these changes is to ensure CASA’s operational resources are allocated where they are needed, which is as close as possible to the aviation industry. These moves are not just symbolic. They will get our people closer to industry operations, and it will give us the opportunity to re-define roles and responsibilities, and move away from our traditional approach to surveillance.
I also recently announced that the Deputy CEO Operations position will move to Brisbane. This will give added management focus at the front line to our main front line function – surveillance of the aviation industry – particularly those involved in, or supporting, passenger carrying operations.
A number of other interesting things have happened since I last spoke to you. The Bilateral Aviation Safety Agreement with the United States came into effect in November 2006. The BASA allows for the import to the US of certain aeronautical products designed and manufactured in Australia, and Australian acceptance of certain FAA approvals.
The Trans Tasman mutual recognition arrangements were passed into law. This represented a significant step forward in meeting Australia’s joint commitment with New Zealand to foster closer economic ties. Under the legislation, eligible airline operators will be able to use aircraft in Australia and New Zealand without the need to be issued with Air Operator Certificates (AOCs) from both civil aviation authorities. This will cut down on red tape and will be achieved through a new type of certificate, known as an AOC with ANZA privileges. It is hoped that mutual recognition will deliver savings to operators through the removal of unnecessary regulatory hurdles.
Until now CASA has operated under governance and financial requirements set out in our own legislation and the Commonwealth Authorities and Companies Act. From 1 July this year governance, finance and some other functions will be directed by the Public Service Act and the Financial Management and Accountability Act. This means CASA will be subject to the same budget processes as all other mainstream government agencies and its staff will be employed under the Public Service Act—the same as all other mainstream government employees.
These changes do not alter CASA’s position as an independent air safety regulator. The same legislative head of power CASA operates under now for our safety functions will remain. CASA is not becoming a part of the Department of Transport and Regional Services. In many ways, CASA will continue to operate as it does now, subject to the reforms we are making to improve our safety effectiveness, efficiencies and relationships with industry.
The transfer to the Public Service Act will not lead to any change in current employment terms and conditions for staff.
What will change is the way we are financially accountable to the Government. There will be changes in other ways, such as in the processes for the delegation of powers. However, none are insurmountable.
I understand that in my case I will be a Chief Executive the purposes of the Financial Management and Accountability Act, a Head for the purposes of the Public Service Act and will continue as the Director of Aviation Safety for the purposes of the Civil Aviation. I suppose I will just have to live with the potential identity crisis.
In addition to changing the way we do things at CASA we have also had to take on some new responsibilities which might be of interest to you.
There is no doubt that the increased focus on transport security worldwide is here to stay and a layered approach to security in aviation will be with us for the foreseeable future. If you had told me 2 years ago that CASA would have to devote significant resources to security related activities, I would have been sceptical. But that is just what we did in 2006, when CASA had to issue thousands of aviation security identification cards (ASICs) to pilots. We now are in the business of issuing about 20,000 ASICs annually.
Drug and Alcohol Testing
The Minister for Transport announced last year that mandatory alcohol and drug testing for the aviation industry would be introduced. This will see people working in safety sensitive jobs, such as pilots, aircraft engineers, air traffic controllers, cabin crew, re-fuelers, and baggage handlers subject to a range of testing requirements. Towards the end of 2006 CASA completed a comprehensive series of workshops around the country, highlighting to industry the need for this testing regime and the basics on how it might work. Regulations have been developed which will set out how the alcohol and other drugs testing regime will operate. I believe the aviation industry has lagged behind other transport modes such as road and rail, who have had drug and alcohol monitoring regimes for some time. It’s about time we caught up, and it will be a challenge for CASA to ensure that whatever regime is introduced achieves its aim of protecting the travelling public.
Office of Airspace Regulation
The Federal Government announced that CASA would be the home for a new Office of Airspace Regulation. This Office will manage and implement the national Airspace plan. Like many countries, the management of Airspace has had political overtones, with various sectors of the industry lobbying from their own perspective. The challenge for CASA is to keep the discussion firmly centered on safety and to ensure that any changes address genuine needs. The Office will formally take over responsibility for airspace management on 1 July, subject to the relevant legislation getting final parliamentary approval.
I suppose this goes to confirm, if confirmation was needed, that aviation is a dynamic industry and that the regulator, like everyone else, cannot afford to stand still.
For the aviation regulator, I believe it is not just a matter of keeping up, it is a matter of taking initiatives and leading change, and that is what we have been doing.
CASA has a clear blueprint to change the way it operates to embrace the concepts of risk management and safety outcomes.
We cannot do this alone and the Australian aviation industry has to accept the challenges being thrown up by this new approach to safety. People in the industry need to accept they have the core responsibility for managing their own safety risks. Air operators, maintenance organisations, aerodromes and training organisations—large and small as well as individuals—must identify their own safety risks and develop systems to manage those risks.
CASA will continue to remove organisations or people from the industry who are unable or unwilling to accept their safety responsibilities.
This will be done promptly where organisations or people demonstrate they do not have the capability to deliver the safety outcomes CASA and the community expect.
The amount of industry surveillance has and will continue to increase, but focussed on organisations and infrastructure that conduct or support fare paying passenger operations, which includes charter.
CASA has started to look more closely at the risk management systems organisations have developed and implemented and assess whether they are adequate or suitable. Organisations and individuals must also be given the ability to accept more responsibility for safety by reducing the number of permissions CASA issues. If you are operating successfully and properly managing risks, you should not need to come to CASA for many of the permissions that are currently required.
This does not mean CASA will stop examining how you are operating. Audits and surveillance, for example, will still include observations of line-flying, maintenance work and training.
But this will be done as a way of measuring the practical outcomes of safety systems—not as an end in itself.
Failure by anyone in industry to accept and act on their safety responsibilities will continue to bring appropriate action from CASA, as the role of the safety policeman cannot and will not be abandoned.
It should be very clear the new approach to managing safety risks is certainly not about the regulator lowering standards or walking away from its role as the safety watchdog.
However, the watchdog will be taking a far more sophisticated approach to achieving safety outcomes: one that will reduce unnecessary burdens on the aviation industry, while working towards an even better air safety record in Australia.
Bruce Byron AM
Chief Executive Officer
31 January 2007