Civil Aviation Authority facing budget ‘problems’
August 6th, 2009
The CAA’s 2009-2010 budget amounts to a 20% reduction in forecast revenues and a 7% drop in spending versus 2008-09 and the body sees a further squeeze in coming years. According to a briefing to the newly appointed Associate Transport Minister, Nathan Guy, the shortfall reflects the impact of the economic downturn on passenger volumes. However, the arrival of Jetstar in place of Qantas’s domestic service will account for about $3.5m of the reduction in CAA’s revenues in the coming financial year, as it is classified as an Aust operator, not liable to pay passenger safety levies.
The CAA wants to make up some of the shortfall by imposing a new ANZA operator’s passenger safety levy to catch operators like Jetstar. The body is also freezing hiring and pay increases, reducing technical training and scrapping sponsorships. Even after these measures, the CAA “has identified a significant and potentially dangerous reduction” in cash reserves by mid 2010. This means any disruption to cash receipts, such as from an airline’s withdrawal from the market, would leave the CAA struggling to make basic payments for payroll and routine operations, the briefing to Guy says. It will also delay the introduction of safety management systems which are becoming the international norm.
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