2002-2003

THE PARLIAMENT OF THE COMMONWEALTH OF AUSTRALIA

HOUSE OF REPRESENTATIVES

CIVIL AVIATION AMENDMENT BILL 2003

EXPLANATORY MEMORANDUM

(Circulated by authority of the Minister for Transport and Regional Services,
the Honourable John Anderson, MP)

TABLE OF CONTENTS

outline	1
financial impact statement………………………………………..…………6
regulation impact statement……………………………………………….7
Introduction										7
1. Issues Identification									7
2. Problems										8
3. Objectives										10
4. Options Considered									11
5. Measures for achieving desired Objectives						11
6. Impact Analysis									14
7. Consultation										15
8. Implementation and review								16

NOTES ON CLAUSES	17
SChedule 1 – civil aviation act 1988	18

CIVIL AVIATION AMENDMENT BILL 2003

OUTLINE

The Civil Aviation Amendment Bill 2003 (the Bill) amends the Civil Aviation Act 1988 (the Act) to implement a range of reforms to the Civil Aviation Safety Authority’s (CASA) governance arrangements and enforcement regime.

The Bill abolishes the CASA Board and retains CASA as an independent statutory authority, thereby providing the Minister with stronger and more direct control over CASA’s governance and accountability in the areas of CASA’s policy directions and priorities, performance standards, reporting and consultation processes, and stakeholder and industry advisory machinery. 

The Director of Aviation Safety (‘the Director’) will become CASA’s Chief Executive Officer (CEO) and will be employed at the Minister’s pleasure.  As the CEO, the Director will have continued responsibility for CASA’s safety regulatory functions, and he will have new governance responsibilities for matters such as preparing CASA’s Corporate Plan and setting the terms and conditions for CASA staff.  The Director will be directly accountable to the Minister for CASA’s performance.

The Bill also provides for greater involvement in CASA’s oversight by the Portfolio Secretary (‘the Secretary’).

Finally, the Bill introduces the following changes to CASA’s enforcement regime.

Automatic stay of CASA’s decision in cases other than a serious and imminent air safety risk

The Bill puts in place an automatic stay of CASA’s decisions to suspend, vary or cancel a civil aviation authorisation such as an Air Operators Certificate (AOC), licence or certificate (‘authorisation’) in cases which do not involve a serious and imminent risk to air safety.  The Bill amends the Act so that such decisions are stayed by force of the Act.  If the authorisation holder applies for Administrative Appeals Tribunal (AAT) review of CASA’s decision within five business days of being notified of the decision, the stay will remain in force for a period of 90 days from the date of notification, or until the AAT’s decision on the matter comes into operation, whichever is the earlier.  The authorisation holder may, if necessary, seek a further stay under normal AAT procedures during this period.  

If the authorisation holder does not apply for an AAT review within five business days of CASA’s decision, the automatic stay will lapse at the end of the fifth business day.  However, the authorisation holder may apply for a stay under normal AAT procedures in order to extend the stay past the first five business days.

There will be no automatic stay of a decision by CASA to vary the conditions of an AOC as such decisions are not subject to a show cause notice obligation.

The automatic stay is intended to balance enhanced fairness with maintaining a high standard of aviation safety.

CASA’s decision to immediately suspend an authorisation in cases involving a serious and imminent risk to air safety

The Bill introduces revised arrangements relating to CASA’s power to immediately suspend an authorisation in cases where it has reasonable grounds to believe there is a serious and imminent risk to air safety.

The Bill introduces a new provision, which prohibits an authorisation holder from engaging in conduct that constitutes, or contributes to, or results in a serious and imminent risk to air safety.  This will cover the immediate suspension of all authorisations under the Act and regulations, rather than the current situation where an AOC is suspended under the Act and all other authorisations are suspended under regulation 268 of the Civil Aviation Regulations 1988.  Regulation 268 will be repealed by regulation amendment.

Where CASA exercises its power to suspend an authorisation because of a perceived serious and imminent risk to air safety, CASA must seek an exclusion order from the Federal Court within five business days of the decision to suspend, otherwise the suspension lapses.  In such cases, CASA’s decision to suspend will not be subject to merits review by the AAT or to the new automatic stay provisions.  

If CASA applies for an exclusion order, the Court must issue the order if, after hearing evidence from both parties, it is satisfied that there are reasonable grounds to believe that the authorisation holder is breaching, or is likely to breach, the new legislative prohibition on engaging in conduct that constitutes, or contributes to, or results in a serious and imminent risk to air safety.

The effect of the exclusion order is to restrain the authorisation holder from engaging in conduct that, without the authorisation, would be unlawful.

The Court will determine the period for which the order is in force.  The maximum period will be 40 days and CASA’s suspension of the relevant authorisation will remain in force for the period of the order.  The Court may terminate or vary an order (including the period of the order) on application by CASA or the authorisation holder.

CASA can only apply for one extension of the order.  If CASA applies for an extension, and if an extension is granted, the exclusion order will continue for such period as the court determines but cannot be for more than  28 calendar days.  If the extension is not granted, or if CASA withdraws its application for an extension, the suspension will lapse on the day the Court decides not to grant the extension, or on the day the application is withdrawn.

During the period of the order, CASA must investigate the circumstances that gave rise to the decision to suspend the authorisation.  If at the conclusion of this investigation, CASA considers that the relevant authorisation should be suspended, cancelled or varied, CASA may, within five business days after the end of the exclusion order period, issue a show cause notice to the authorisation holder.  A show cause notice is a written notice to the authorisation holder setting out the reasons why CASA is considering making a decision, and stating the period during which the authorisation holder may show cause why CASA should not make the proposed decision.  If CASA issues a show cause notice, the suspension will continue for the period of the show cause notice.  If CASA does not issue a show cause notice, the suspension will lapse at the end of the fifth day after the period of the order, unless the suspension is revoked earlier.

Where CASA issues a show cause notice, it will be required to make a final decision on the matter within five business days of the end of the show cause notice period.  If CASA’s final decision is to suspend, vary or cancel an authorisation, the authorisation holder can seek merits review by the AAT, but with no automatic stay.  

If, however, CASA’s investigation does not produce sufficient evidence that the conduct of the authorisation holder constitutes a serious and imminent risk to air safety, CASA may decide to issue a show cause notice under the provisions relating to non-imminent safety risks.  In those situations, the suspension that resulted in the Court order will lapse on the day CASA gives the authorisation holder the show cause notice. 

The scheme will provide a greater degree of natural justice by giving an authorisation holder the opportunity to have their case heard in Court, thereby ensuring independent judicial scrutiny of whether there are reasonable grounds to believe that the authorisation holder is engaging in, or is likely to engage in, conduct that poses a serious and imminent risk to air safety.

Demerit Point Scheme

The Bill introduces a demerit point system based on the NSW demerit point system for motor vehicle drivers’ licences.  The scheme will apply generally to offences against the regulations (offences against the Act are excluded from the scheme).  The number of points that will attach to each offence will be prescribed in the regulations.  CASA will record demerit points against an authorisation holder’s name in a demerit point register.

An authorisation holder will incur demerit points for an offence if they are served with an infringement notice for the offence and pay (in whole or in part) the fine specified in the notice; or if they are convicted or found guilty of the offence as a result of challenging their liability for the infringement notice in court, or of CASA taking prosecution action outside the infringement notice scheme.

The period in which the maximum number of points can be accumulated or exceeded before CASA takes any action is three years.  The maximum number of points that can accrue in the first three-year period is 12 points.  When an authorisation holder accrues or exceeds that limit, CASA must issue a suspension notice to the authorisation holder.  The effect of this notice is that all the authorisations in the authorisation holder’s name of the same class are suspended by force of the Act.  Classes of authorisations will be prescribed in the regulations and will generally authorise a similar activity.  The issue of a suspension notice is not subject to merits review by the AAT, as CASA has no discretion in relation to the issue of a suspension notice.

If a person’s authorisation has been suspended once previously under the demerit points scheme then the person will only need to accrue six points to have their authorisation suspended again under the demerit points scheme which has the effect outlined in the previous paragraph.

If a person has more than two suspensions under the demerit points scheme the person will again be allowed a maximum of six points. However, in these circumstances, CASA must issue a cancellation notice to the authorisation holder.  The effect of a cancellation notice is that all the holder’s authorisations in the same class are cancelled by force of the Act for a period of three years.  The issue of a cancellation notice is not subject to merits review by the AAT, as CASA has no discretion in relation to the issue of a cancellation notice.

Where an authorisation holder has several authorisations relating to the same activity, and all the authorisations are suspended or cancelled, the authorisation holder will be able to apply to CASA to have a particular authorisation reinstated with special conditions if the suspension or cancellation of that authorisation will cause the authorisation holder severe financial hardship.  CASA’s decisions on such applications will be subject to merits review.

All demerit points accrued by the authorisation holder in relation to a particular activity will be deleted from the register when the authorisation holder accrues or exceeds the maximum number of points and the authorisation holder’s authorisations for that activity are suspended or cancelled.  In addition, demerit points accrued in respect of a particular contravention will also be deleted if the authorisation holder is prosecuted for that contravention and found not guilty.

This scheme will provide a largely non-discretionary, self-executing system of dealing with repeat offenders.

Protection from administrative action for voluntary reporting

The Bill introduces a protection from administrative action, based on the system administered by the National Aeronautical Space Administration in the United States on behalf of the Federal Aviation Administration.

Under the scheme, an authorisation holder will be protected from administrative action in respect of an authorisation (ie suspension, cancellation or variation of the authorisation, or the giving of an infringement notice) if the authorisation holder voluntarily discloses to a reporting body separate from CASA that they have committed a minor offence, within ten days of doing so, and before they receive any communication from CASA in relation to the contravention.  It is not the intention of the scheme to protect an authorisation holder from prosecution action.

Details about the reporting body and the operation of the scheme will be prescribed in the regulations.  This is not intended to be a whistleblowing scheme and the protection will only apply to the person who reports the contravention.

The protection will apply only in relation to ‘reportable contraventions’.  A ‘reportable contravention’ is a contravention that is eligible to be reported so as to receive the protection.  Reportable contraventions will be contraventions of the regulations and will not include deliberate contraventions of the regulations; contraventions of prescribed regulations (ie the regulations to which the protection will not apply in any circumstances will be prescribed); contraventions that cause or contribute to an accident or serious incident before or after the breach is reported; and contraventions involving fraudulent behaviour.

The reporting body will log each report in a confidential reporting system; and will issue a receipt to the authorisation holder which sets out the authorisation holder’s name, the date the report was made, and the date and nature of the contravention.  There will be no limit to the number of reports an authorisation holder is able to submit, but they can only be protected from administrative action for one reportable contravention every five years.  

Should CASA be alerted to the contravention reported, through an independent investigation of a safety matter, within 5 years after the contravention is reported, the authorisation holder will be protected  from administrative action in respect of the contravention, providing they can produce proof that they reported the contravention, and provided that the contravention was in fact reportable. 

Reports under this scheme will not relieve an authorisation holder of their mandatory reporting obligations under Division 2 of the Air Navigation Act 1920 (to be subsumed by the Transport Safety Investigation Bill 2002 when enacted).

CASA will not be able to use a report of a reportable contravention; the fact that the report has been made; or a receipt given to it by an authorisation holder, as evidence in criminal proceedings against the person who reported the contravention, if at the time the proceedings commence, the contravention is still reportable.

The Bill provides for regulations to be made dealing with the information reported to the prescribed person under the scheme.  Such regulations may not allow ‘personal information’ within the meaning of the Privacy Act 1988 (‘Privacy Act’) to be disclosed.  However, it is envisaged that the reporting body will publish de-identified information arising from reports, which will facilitate analysis of trends that may indicate a need for training etc.

The scheme is intended to encourage self-reporting of minor breaches without the fear of reprisal, and provide a means to identify general trends in matters of concern relating to air safety.

Enforceable Voluntary Undertakings

The Bill establishes a scheme of enforceable voluntary undertakings that will give CASA power to accept a written undertaking from an authorisation holder in relation to compliance with civil aviation safety legislation.  Such undertakings will be completely voluntary – CASA will not have the power to compel an authorisation holder to give an undertaking.  An undertaking may run for no more than six months.  However, once an authorisation holder has given an undertaking, if CASA considers that the holder has breached a term of that undertaking, CASA will be able to seek an order from the Federal Court requiring the authorisation holder to abide by the undertaking.  The provision is modelled on section 87B of the Trade Practices Act 1974.

Financial impact statement

The Bill is largely of a machinery nature, and aside from some savings from the abolition of the CASA Board, will have no financial impact on the Commonwealth.

REGULATION IMPACT STATEMENT

Introduction

This Regulation Impact Statement (RIS) deals with the proposed new enforcement measures for the Civil Aviation Safety Authority (CASA), excluding Enforceable Voluntary Undertakings (EVUs), which were agreed to by the Government on 18 November 2002.  

A RIS for the EVUs was previously prepared for the Aviation Legislation Amendment Bill (No.2) 2000, which subsequently became the Aviation Legislation Amendment Bill (No.1) 2001.  After passing the House of Representatives the Bill was referred by the Senate to the Rural and Regional Affairs and Transport Legislation Committee.  Although the Committee reported in April 2001 the Bill was not passed by the Senate and lapsed with the proroguing of Parliament before the last Federal election.

The Committee made a number of recommendations for amendments to the Bill and other requirements to meet industry’s concerns mainly about the unrestricted scope of the undertakings, and increasing the levels of accountability and transparency in their administration, as expressed at the Committee’s public hearings. These recommendations have been taken into account in this Bill.

The package of changes to CASA’s enforcement regime, which are proposed to take effect four months from the date of Royal Assent, will provide CASA with a broader range of tools so that the regulatory action can more appropriately be matched with the seriousness of the breach.  They also strike the appropriate balance between enhancing fairness and maintaining CASA’s powers to take action on safety breaches.

Issues Identification

CASA’s enforcement powers are set out in the Civil Aviation Act 1988 and Civil Aviation Regulations and provide for action to be taken against the holder of a civil aviation authorisation (eg licence, certificate or authority) who does not meet the relevant safety standards.

CASA’s regulatory response to a detected inadequacy in the manner in which an operator conducts its operations, or a licence holder exercises the privileges of his or her licence, varies according to whether the inadequacy creates a serious and immediate safety threat or whether it merely increases the overall safety risk in a less direct and immediate way.  This response can vary from a simple request to observe the standards to suspension, cancellation or variation of a licence or certificate to operate, and in major breaches of the rules to prosecution under the criminal code.
The current tools available to CASA in taking enforcement action are:
•	counselling/warning;
•	remedial training;
•	requiring a person to undergo an examination;

•	variation, suspension or cancellation of Air Operator’s certificates and civil aviation authorisations;
•	issue of infringement notices; and 
•	prosecution action.

CASA’s primary focus is on the safety of fare paying passengers.  In almost all cases, CASA considers that the appropriate response to inadequacies that create a serious and immediate threat to fare paying passengers must be immediate licence or certificate cancellation or suspension action.  In other cases, other regulatory responses may be more appropriate.  It is important that any detected inadequacy that increases the safety risk must be addressed in some way and must not be permitted to continue.

The public has an expectation that air safety is regulated effectively, and that all participants in the aviation industry comply with CASA’s safety rules.  It is therefore imperative that CASA has the appropriate enforcement powers to ensure that only persons and entities that can demonstrate that they can, and will, meet safety requirements are to be allowed to participate.

However, an enforcement regime needs to encourage a culture of compliance without unduly impacting on individual rights.  CASA’s enforcement policy determines the way CASA uses its powers to regulate the industry.  The Government must ensure that CASA uses its powers in a way that inspires the confidence of the travelling public, and is seen to be, fair, transparent, consistent and appropriate. 

The Problems

Overview

There are a number of reasons why changes are necessary and a new approach to enforcement is needed in order to enable CASA to more properly discharge its responsibility to the Australian public.

First, aviation safety depends upon there being a high level of trust between CASA and the industry.  Some parts of the industry believe that CASA’s current enforcement processes are arbitrary, inconsistent and unfair.

Secondly, the Government believes that CASA should give proper emphasis to its safety education and promotion functions.  However, CASA can only do this efficiently if it has quality information available to it about contraventions of the safety rules.  Pragmatically, no matter how many resources are committed to the task, the very nature of aviation means that a significant number of contraventions will always remain undetected.  Accordingly, it is considered that effective safety education and promotion and a new approach to enforcement that encourages the voluntary reporting of honest contraventions go hand in hand.

Finally, the Government believes that the vast majority of the aviation industry is committed to working within the safety rules.  A new approach to enforcement will ensure that scarce and expensive investigation and enforcement resources are not wasted on pursuing this segment for minor, inadvertent or technical contraventions that do not significantly affect safety.  CASA needs to have the capacity to vigorously pursue those who choose to operate outside the rules and those who put the lives of fare-paying passengers at risk.

The basic philosophy underpinning the proposed new approach is that:
•	a person who reports making an honest mistake of a minor nature generally should not have their licence, certificate or authority suspended or cancelled;
•	there should be a measured response to less serious contraventions of the safety rules which should involve counselling, warnings, training or administrative fines, rather than either criminal prosecution or the suspension or cancellation of licences, certificates or authorities;
•	the right to seek a merits review from an impartial decision maker should be a primary consideration in the enforcement process, except in those rare cases where there is an immediate, serious threat to the safety of fare-paying passengers; and
•	people who consciously and repeatedly choose to operate outside the rules or who put the lives of fare-paying passengers at risk should be prosecuted and removed from the industry.

Need for prompt and independent review

CASA’s enforcement powers continue to receive criticism from some sectors of industry which advocate that CASA should not be a regulator and enforcer.  Central to this criticism is CASA’s power to immediately suspend an aviation authorisation in the case of an imminent risk to air safety; or to vary, suspend or cancel an aviation authorisation in situations where there is no imminent risk to air safety.

Presently, if a person in the aviation community disagrees with an exercise of a suspension, variation or cancellation power by CASA, the person can lodge an application for review of the relevant decision with the Administrative Appeals Tribunal (AAT).  In reviewing the decision, the AAT considers the merits of the original decision; that is whether the decision was the correct or preferable decision on the basis of the facts and applicable law.  

In addition, the Federal Court has jurisdiction to review the exercise of CASA’s suspension, variation or cancellation powers on legal grounds under the Administrative Decisions (Judicial Review) Act 1977.  The Federal Court does not look at the merits of CASA’s decision.  It does, however, review CASA’s exercise of the discretion to determine whether the exercise of the discretion breached a principle of law. 

However, reviews of suspension and cancellation action have inherent time delays and may take some months to finalise and in the meantime the operator is unable to continue his/her business leading to financial problems.  There have also been general claims that the current processes are unfair and do not allow for due process. 

To improve procedural fairness for industry in suspension and cancellation action taken by CASA there is a need for measures to be introduced which will provide methods of prompt and independent review and redress.  Such measures would address any perceived or actual actions of improper motive or lack of objectivity on the part of CASA in the exercise of its suspension and cancellation powers.  A process needs to be found that strikes the correct balance between the interests of safety on one hand, and the individual and commercial interests of aviation participants on the other.

Need for Infringement Notices to be linked to Demerit Point System
CASA currently has a system of infringement notices for breaches of the regulations not involving serious safety matters where neither prosecution nor suspension action is warranted but some formal enforcement action is justified. 

In most cases, payment of an administrative fine by a person will dispose of the matter and no further action is to be taken.  However, in more serious circumstances, for example, multiple or repeated contraventions of the regulations which evidence not only a poor safety record, but also an apparent unwillingness by a person to comply, infringement notices can be used in conjunction with licence variation, suspension or cancellation action.  The use of infringement notices is an administratively simple scheme and allows for a greater focus to be given to more serious offences involving the safety of fare paying passenger operations.

However, the imposition of administrative fines may not always deter the individual or organisation from breaching the law in a similar way in the future, particularly if it is seen as just a cost of operating.  Furthermore, it is desirable to have a mechanism that essentially removes the scope for discretion and predetermines the point at which a person’s aviation authorisation would become suspended or cancelled so that the process is transparent, consistent and fair.  The linking of demerit points to the infringement notice will provide a self-executing scheme.

Objectives of Government Action

The primary objective of Government action is to provide CASA with a more effective range of enforcement measures (both ‘light touch’ and ‘heavy-handed’) to encourage a culture of compliance and reduce incidences of unsafe behaviour and therefore improve both the safety environment and record in Australia.

The sub-objectives include that the proposed new regulatory responses will allow CASA to: 
•	effectively and efficiently utilise CASA and industry resources; 
•	deter recurrences or continuations of more minor breaches; 
•	assist industry to comply with, and CASA to enforce, laws that are open to interpretation, for example, because they are drafted in a non-prescriptive, outcome-based style; 
•	deal appropriately and not overly severely with individuals or organisations who commit a minor or technical breach of the law and who demonstrate a willingness to take steps to prevent further similar breaches in the future; 
•	utilise appropriate regulatory responses in particular situations without significant delay and without unduly impacting on individual rights;
•	reduce the scope for criticism of the exercise of the suspension and cancellation powers by CASA by providing methods for prompt and independent review and redress; and
•	improve the level of procedural fairness.

Heavier regulatory responses, such as immediate suspensions which continue only if the Federal Court makes an appropriate exclusion order, will empower CASA to specifically require or restrain particular conduct in a way that must be shown to constitute a serious and imminent risk to safety.  The interpolation of an impartial judicial process, in the form of the decision on CASA’s application for an exclusion order, will have the effect of separating CASA to some extent from the action taken.

Identification of Options

A review of CASA’s governance arrangements, rule making processes and enforcement procedures was completed by the Chairman of CASA, Mr Ted Anson, in June 2002, and formed the basis for the Government’s consideration of reforms to CASA.

On 18 November 2002 the Government agreed to a number of reforms to CASA, including that CASA’s enforcement processes be enhanced by the following package of changes:

(a)	a scheme for the automatic ‘stay’ of CASA’s decision to vary, suspend or cancel an aviation licence, certificate or authority (aviation permission) where there is no imminent risk where the permission holder seeks a review within a specified time frame;
(b)	the use of injunctions for immediate suspensions where there is a serious and imminent risk;
(c)	the introduction of a demerit point system to provide an enforcement tool for CASA to deal with minor breaches;
(d)	a protection from administrative action for voluntary disclosure to assist CASA in gathering information on contraventions; and
(e)	enforceable voluntary undertakings to redress infringements for which prosecution or licence action would be disproportionate or unwarranted.

The Government also agreed that the reform measures take effect from 1 July 2003.

Against this background, the choice of alternative policy options is restricted.  The only other feasible policy option would be not to undertake reform and maintain the status quo.  

Measures for achieving the desired objectives

The Government has decided that CASA’s enforcement processes be enhanced by the following measures.

Automatic ‘stay’ of decisions

The Government has decided that there should be an automatic stay of normal decisions to vary, suspend or cancel aviation authorisations, allowing the authorisation holder to continue to exercise the privileges of the authorisation.  Automatic stays of this type are presently used in the USA.  This would not apply to immediate suspensions to ameliorate a serious and imminent risk to air safety, or to CASA’s decision to vary the conditions of an Air Operator’s Certificate.

Under the proposed scheme, a final decision by CASA to vary, suspend or cancel an aviation authorisation would automatically be ‘stayed’ for a period of 90 days where the holder of the authorisation lodges an appeal to the AAT against the decision within 5 days of being notified of the decision.  At the end of the 90 day period the stay will lapse and the authorisation holder will need to apply to the AAT for a further stay at that time.

If the authorisation holder lodges an appeal to the AAT outside the 5 day period, they can seek a stay of CASA’s decision but will not have an automatic stay, as is currently the case.

Such a scheme is unlikely to have an adverse safety impact because, in the ordinary course of events, final decisions to vary, cancel or suspend an aviation authorisation are not linked to an immediate risk to aviation safety and often taken many months to finalise. 

Immediate Suspensions – Federal Court Orders

As mentioned above, the automatic stay procedure would not be able to be used by persons whose actions are considered to pose a serious and imminent risk to air safety. 

Accordingly, this is a separate mechanism which is needed to deal with such urgent safety risks.  The exercise of an immediate suspension power not only protects passengers and property on board aircraft that may be unsafe, it also protects the crew of the relevant aircraft, the families of passengers, persons on the ground and public confidence in aviation safety as a whole.  It will be able to be exercised in short time frames, at any time.  It will also strike the correct balance between the interests of safety on the one hand, and individual and commercial interests of aviation participants on the other.

As is currently the case, CASA will, under this mechanism have the power to immediately suspend an authorisation upon receiving adequate evidence.

However, CASA must within 5 days of its decision to suspend seek an exclusion order from the Federal Court, otherwise the suspension lapses.  In such cases, CASA’s decision to suspend will not be subject to merits review by the AAT or to the new automatic stay provisions. 

The Court’s decision will be based on appropriate argument and evidence from both parties.

The effect of the exclusion order will be to restrain the authorisation holder from engaging in conduct that, without the authorisation, would be unlawful.

The maximum period of the Court order will be 40 days and CASA’s suspension will continue to remain in force for the period of the order.  CASA may apply for one extension of the order.  In such cases the order will continue for 28 days unless the Court decides otherwise.

At the end of the order period, CASA will have 5 days in which to issue a show cause notice and the suspension will continue for the period of the notice (a reasonable period not to exceed 28 days).  If CASA does not issue a show cause notice the suspension will lapse at the end of the 5th day.

CASA must make a final decision on the matter within 5 days of the end of the show cause period.  It may do nothing further, in which case the suspension lapses, or it may decide to vary, suspend or cancel the authorisation.  If CASA’s final decision is to suspend, vary or cancel an authorisation, the authorisation holder can seek merits review by the AAT, but with no automatic stay.

This would only allow CASA to unilaterally revoke an authorisation, allowing it to protect immediately what it perceives to be the safety interest, but only for 5 days during which time any commercial detriment would be relatively minor. 

It should be noted that the AAT currently has jurisdiction to stay a decision pending the hearing of review on the merits of a decision, including a decision to immediately suspend an authorisation.  However, under the proposed scheme CASA’s initial decision to suspend an authorisation because of a perceived serious and imminent risk to air safety will not be subject to merits review by the AAT or to the new automatic stay provisions.  The benefit of the proposed scheme is that unlike the present system where the authorisation holder is required to seek a review of the decision to suspend, the new system will require CASA to apply for a judicial order preventing the authorisation holder from conducting activities pursuant to their licence, and only if the court grants such an order can CASA’s suspension continue. 

Demerit point scheme

As an additional enforcement tool, the Government has decided to introduce a demerit point system for minor infringements of the regulations, similar to the system in place for motor vehicle drivers’ licences.  Under this system, the point at which a person’s aviation authorisation would become suspended or cancelled would be predetermined, thus largely removing the scope for discretion.

The points system will be linked to the issue of infringement notices and prosecution action.  An infringement notice will, depending upon the particular alleged offence, carry a specified number of points. There will be a maximum number of points that can be incurred every three years.  Once the statutory number of points has been reached, the law would operate to automatically suspend a person’s licence or certificate.  CASA would simply administer that law, in the same way as the Roads and Traffic Authority administers the demerit point scheme for road traffic infringements in New South Wales.  The suspension period will depend on the points incurred.  

In order to deal appropriately with individuals suspended for a second and third time the maximum number of points that can be incurred in the second and third three year periods will be halved with cancellation action being taken in the third three year period rather than suspension action. 

Where an authorisation holder has several authorisations relating to the same activity, and all the authorisations are suspended or cancelled, the authorisation holder will be able to apply to CASA to have an authorisation reinstated with special conditions if the suspension or cancellation of that authorisation will affect their livelihood.  CASA’s decisions on such applications will be subject to merits review.

It would be inappropriate for infringements that involved a serious and imminent risk to the safety of air navigation to be covered by the demerit point scheme.

Protection from administrative action for voluntary self reporting

This scheme will assist CASA in the gathering of information about contraventions of the regulations.  It will provide a statutory protection from administrative action (eg licence suspension) to authorisation holders who voluntarily disclose minor breaches to an independent body through a confidential reporting system within ten days of the breach.  The proposed confidential reporting system is based on the proven system used in the United States known as the Aviation Safety Reporting System.  Under that system there is no limit on the number of reports a person is able to submit but a person can only take advantage of the protection once every 5 years.  

However, a protection will not be available for:
•	deliberate breaches of the regulations;
•	breaches of the Civil Aviation Act 1988;
•	breaches that seriously endanger the safety of fare-paying passengers, other aircraft or people on the ground; 
•	contraventions involving fraudulent behaviour; or
•	contraventions that cause or contribute to an accident or serious incident before or after the report is lodged.

This scheme will encourage a culture of reporting safety breaches and will assist CASA in identifying patterns that may indicate a need for training.

Impact Analysis 

Automatic Stay

A main priority of commercial operators is to resolve disputes quickly.  A delay in resolving matters almost always negatively affects income.  The automatic stay procedure will allow the individual or organisation to continue to earn income. 

As is currently the case, individuals and organisations are likely to obtain legal advice before lodging an appeal against CASA’s decision, and this will involve expense. However, the right of appeal is voluntary.  

Consequently there is minimal change to the current arrangements other than that the individual or organisation can continue to operate.

Overall, the automatic stay procedure is likely to reduce industry costs.

Immediate Suspensions – Federal Court Orders

The exercise of CASA’s suspension and cancellation powers has been challenged in the Federal Court in only a relatively small number of occasions.

In the more serious or complex cases, the individuals or organisations involved would normally engage lawyers no matter what regulatory response CASA chose to make, so the proposed scheme would not add to costs. 

Demerit Point Scheme

The demerit point scheme is likely to have a positive deterrent effect on licence holders and as a consequence there is likely to be less of a need for matters to be prosecuted by the Director of Public Prosecutions (DPP) or for CASA to suspend or cancel licences, certificates and approvals.  

There will be some minor additional costs to CASA in administering the scheme but these are not expected to be significant. 

Protection for voluntary disclosure

This scheme is purely voluntary.  An individual or operator can decide not to disclose the information if, in their assessment of the particular circumstances, it is not in their interests to do so.  In these circumstances, so far as the individual or operator is concerned, the changes would have no effect.  The purpose of the scheme is in fact to provide an incentive to licence holders to voluntarily report unintentional contraventions of the safety rules.

There would be some additional costs to the agency responsible for administering the scheme.  However, the actual resources involved are expected to be minimal and no additional funding has been sought. 

Consultation

CASA’s enforcement powers and procedures have been the subject of consultation with industry for many years.  The new measures outlined above are responsive to the representations received from industry. 

The Minister issued a press release on 18 November 2002 announcing a number of reforms to CASA, including the introduction of a package of measures to reform CASA’s enforcement processes.

The Minister also hosted an industry function on 12 December 2002 to advise key stakeholders of the reform measures.

Conclusion 

The Government has decided that CASA’s enforcement processes should be enhanced by all of the above measures.

The new measures will strengthen CASA’s enforcement regime by introducing all of the above new courses of action for CASA and at the same time will provide safeguards for the industry through automatic stays and court involvement.

The vast majority of the industry is committed to working within the safety rules.  The introduction of a demerit point scheme will provide CASA with an important new regulatory response to enable it to better deal with minor breaches of the safety regulations.  It should also generate a proper deterrent effect on aviation participants.

In addition, and in the interests of promoting CASA’s reputation, the aviation community will be offered some comfort from the reduction of the unilateral nature of the exercise of the cancellation powers through: causing immediate suspensions to lapse unless the Federal Court grants an appropriate exclusion order; and automatically staying for a period of ninety days other exercises of the suspension and cancellation powers.

The proposed new enforcement regime will reduce incidences of unsafe behaviour and therefore improve both the safety environment and record in Australia.  This encourages greater confidence by the public in air travel, provides additional business opportunities for the aviation industry, and offers safe skies for all.

Implementation and review

The recommendations will be implemented through amendments to existing legislation (ie Civil Aviation Act 1988 and associated regulations). 

The usage/uptake of the new measures will be monitored jointly by the Department and CASA.

NOTES ON CLAUSES

Clause 1 - Short Title

Clause 1 is a formal provision specifying the short title of the Bill.

Clause 2 - Commencement

Clause 2 provides that Sections 1 to 4 commence on Royal Assent; Items 1, 3, 6, 7, 8, 10, 11, 12, 13 and 18 to 48 of Schedule 1 of the Bill will commence on 1 July 2003; and Items 2, 4, 5, 9, 14, 15, 16 and 17 of Schedule 1 will commence four months after Royal Assent.

Clause 3 - Schedule

The Civil Aviation Act 1988 is amended as set out in Schedule 1 to the Bill.

Clause 4 - Application and savings 

Clause 4 sets out the savings provisions for the preparation of a corporate plan, annual report, the Director of Aviation Safety’s position, the terms and conditions for CASA staff previously determined by the Board, and defines the terms ‘CASA’ and ‘Director’.

SCHEDULE 1 – CIVIL AVIATION ACT 1988

Items 1, 3, 7 and 8 - Subsection 3(1)

Items 1, 3, 7 and 8 amend subsection 3(1) of the Act by repealing the definitions of Board, Chairperson, Deputy Chairperson and member, as they are superfluous following the abolition of the Board. 

Items 2 and 9 – Subsection 3(1)

Items 2 and 9 amend subsection 3(1) of the Act to insert new definitions of ‘business day’ and ‘show cause notice’ for the purposes of the new enforcement schemes.

Items 4 and 5 - Subsection 3(1)

Items 4 and 5 amend subsection 3(1) of the Act to expand the existing definition of ‘civil aviation authorisation’ to include authorisations under the Act and the regulations, and Air Operators Certificates and Part III permissions.

Item 6 – Subsection 3(1)

Item 6 amends the definition of ‘corporate plan’ in subsection 3(1) of the Act to replace the reference to the Board with a reference to the Director.  This is a consequence of the abolition of the Board. 

Item 10 – Section 12(1)

Item 10 amends s.12(1) of the Act to add a new provision providing the Minister with a new explicit power to direct CASA to consult in a particular manner, about particular matters with specific bodies, individuals or organisations.

Items 11 and 12 – Section 12A

The Minister has the power under s.12A(1) to notify CASA of his views on the appropriate strategic direction for CASA, and the manner in which CASA should perform its functions. Item 11 will amend subsection 12A(1) to insert a new provision preventing the Minister from notifying his views in relation to how a particular case or particular individual authorisation holder should be dealt with.  Section 12A(2) currently requires that CASA only take account of those views.  Item 12 will amend s.12A(2) to require CASA to act in accordance with the Minister’s views. 

Item 13 – New sections 12C and 12D

Item 13 inserts new ss.12C and 12D.  Section 12C will provide the Minister a new power to enter into a binding agreement with the Director in relation to the performance of CASA’s powers and the execution of CASA’s functions.  Such an agreement is likely to cover CASA’s policy direction, priorities and performance standards.  The Director will be required to advise the Minister of any matter that may prevent him from complying with the terms of the agreement.  The provisions at Item 13 ensure that an agreement   cannot impose a requirement that CASA perform a function or exercise a power in relation to a particular case or an individual authorisation holder in a particular way.  Such agreements will be required to be tabled.

The new s.12D will provide the Minister with a new explicit power to direct CASA to report to the Minister or to the Departmental Secretary under specific arrangements and about specific matters.  

Item 14 – Section 28BA

Item 14amends s.28BA of the Act by inserting a new provision  requiring CASA to issue a  show cause notice  before suspending or cancelling an AOC.  Under the amendment, where CASA decides to suspend or cancel an AOC, CASA will also be required to include in the notice of its decision details about the holder’s rights to obtain an automatic stay under the new s.31AA being inserted under Item 17.

Item 15 – Part III

Item 15 creates five new Divisions in Part III of the Act to establish five new schemes under CASA’s enforcement regime.

Division 3A

Item 15 introduces Division 3A to deal with revised arrangements for the immediate suspension of an authorisation in cases of a serious and imminent risk to air safety.  Currently, CASA may immediately suspend a licence or  certificate (other than an AOC)  under regulation 268 of the Civil Aviation Regulations 1988, and an AOC under s.28 of the Act.  The new Division 3A amends these arrangements by encompassing the immediate suspension of all authorisations under the Act and the regulations.  Regulation 268 will be repealed by regulation amendment. 

Division 3A encompasses:

–	new s.30DA which defines the term ‘engage in conduct’ as an act or omission;

–	new s.30DB which creates a legislative prohibition preventing an authorisation holder from engaging in conduct that constitutes, contributes to or results in a serious and imminent risk to air safety.  This provision is required to ensure the Federal Court has judicial power to hear matters related to this scheme;

–	new s.30DC which allows CASA to suspend an authorisation by written notice to an authorisation holder where it has reason to believe they have contravened the new s.30DB prohibition, and provides that the suspension will lapse at the end of the fifth business day after the day they were notified of the suspension, unless CASA seeks a Federal Court order under the new s.30DE within that period;

–	new s.30DD allows CASA to make a decision under s.30DC even if it has issued a show cause notice to an authorisation holder under another provision of the Act or the regulations.  s.30DC also provides that a suspension under s.30DC will have effect despite a stay (automatic or not) of an earlier decision to vary, suspend or cancel the authorisation;

–	new s.30DE requires the Federal Court to grant an exclusion order of not longer than 40 days, if it satisfied upon hearing evidence from both parties, that there are reasonable grounds to believe the authorisation holder is engaging in or is likely to engage in conduct that contravenes s.30DB;

–	new s.30DF provides that either party may seek a variation of the order.  However, the Court may only vary the order period once, by either extending the original period by no more than 28 days, or shortening it.  s.30DF provides that an application for variation must be made before the end of the order period, and that CASA may only seek one extension.  The table in s.30DF summarises the scenarios that will end the original suspension;

–	new s.30DG requires CASA to complete its investigation of the circumstances that gave rise to the suspension by the end of the order period;

–	new s.30DH provides that where CASA decides to issue a show cause notice at the end of its investigation, CASA must issue the show cause notice by the end of the fifth business day after the last day of the order in order for the suspension to continue; and

–	new s.30DI requires that where CASA has issued a show cause notice, that it notify the authorisation holder of a final decision to suspend, vary or cancel their authorisation, within five business days after the end of the show cause period for the suspension to continue.

Where CASA’s investigation reveals evidence that indicates a risk other than a serious and imminent risk, CASA may issue a show cause notice under the new automatic stay provisions at Item 17 that deal with cases other than a serious and imminent risk.  In that regard, an automatic stay would take effect and the suspension that gave rise to the exclusion order would lapse.

–	new s.30DJ provides a table detailing when the suspension ends.

This scheme is designed to enhance fairness by introducing court adjudication of CASA’s decisions to immediately suspend an authorisation.

Division 3B

Item 15 introduces a scheme for enforceable voluntary undertakings (EVUs) under new Division 3B, s.30DK, modelled on s.87B of the Trade Practices Act 1974.  s.30DK will allow CASA to accept a written undertaking from an authorisation holder in connection with a matter arising under the Act or the regulations in relation to which CASA has function or power under the Act or the regulations.  

The proposal for EVUs was introduced previously under the Aviation Legislation Amendment Bill (No. 2) 2000, which subsequently became the Aviation Legislation Amendment Bill (No. 1) 2001, and has been revised to take into account recommendations made by the Senate Rural and Regional Affairs and Transport Legislation Committee which examined that Bill.  The changes made are as follows:

•	CASA must publish details of an EVU on the Internet; 

•	the period for which an EVU applies must not exceed 6 months; and 

•	where CASA considers a person has breached any terms of an EVU and applies to the Federal Court for an order, any order by the Court which requires payment of money to the Commonwealth will be limited in that the Court can only order an amount up to the amount of any financial benefit that the person has obtained directly or indirectly from, and that is reasonably attributable to, the breach of the undertaking.

s.30DK further provides that an EVU must not require payment to CASA as the air safety regulator.

EVUs are an important component of CASA’s published enforcement policy, which was approved by the CASA Board in 1998 and subsequently circulated for consultation.  CASA officers often detect regulatory inadequacies in the operation of an authorisation.  Such inadequacies may involve a breach of the Act, the regulations or the Civil Aviation Orders, but in many instances prosecution action for that breach would be disproportionate and unwarranted – either by nature of the breach, or the diversion of resources that would be involved in conducting that prosecution, or in terms of the net benefit to aviation safety.  In those circumstances the use of an EVU to address the inadequacy is seen as an efficient and effective way in which aviation safety can be enhanced without the use of unwieldy or inappropriate criminal or administrative sanctions.

Division 3C

Item 15 establishes a new scheme under Division 3C whereby an authorisation holder will be protected from administrative action (suspension, variation or cancellation of their authorisation, or the giving of an infringement notice) if they voluntarily report a contravention of the regulations within 10 days of the contravention to an independent reporting body.  Division 3C does not confer any immunity from prosecution.

Division 3C encompasses:

–	–	new s.30DL provides definitions for ‘accident’, ‘serious incident’, ‘prescribed person’ and ‘reportable contravention’. This definition of ‘reportable contravention’ details the contraventions that will not be covered by the protection;

–	new s.30DM provides that the regulations will prescribe a person for the purposes of the scheme and ensures that the prescribed person may be a statutory authority or statutory office holder;

–	new s.30DN provides that details of the reporting scheme, including the operation of the scheme, will be prescribed under the regulations.  s.30DN also prevents the disclosure of personal information within the meaning of the Privacy Act;

– 	new s.30DO prevents CASA from taking administrative action in respect of a reportable contravention if the authorisation holder can prove they have reported the contravention in the required timeframe, and before the issue of an infringement or show cause notice;

–	new s.30DP details the nature of the proof CASA requires for the protection to apply;

–	new s.30DQ provides that an authorisation holder can only be protected from administrative action from one reportable contravention every five years; and

–	new s.30DR provides that a report of a reportable contravention; the fact that the report has been made; or a receipt produced as proof that a reportable contravention was reported in the required timeframe, cannot be used as evidence in any criminal proceedings against the authorisation holder, if at the time the proceedings commence, the contravention is still reportable.

Division 3D

Item 15 establishes a new demerit point scheme along the lines of the NSW system of demerit points for motor vehicle drivers’ licences, whereby demerit points will be recorded against an authorisation holder’s name in relation to the class of authorisations to which the offence relates, and when the specified maximum number of points is reached or exceeded for that class, all the authorisations in that class will be suspended or cancelled.  For example, where an authorisation holder accrues several points against their commercial pilot licence, and several points against their private pilot licence, all their pilot licences will be subject to suspension or cancellation.  However, if the person also holds maintenance authorisations, for example, those authorisations are not suspended or cancelled.  

The scheme is intended to be non-discretionary in that an authorisation will be suspended or cancelled upon the maximum number of demerit points being reached or exceeded.  CASA will retain the discretion to take a particular course of action in respect of an offence.  Whenever it uses an infringement notice (and the authorisation holder pays the penalty arising from the infringement notice), or successful prosecution action to address a contravention, demerit points will apply and the number of points that will accrue will depend on the offence.

Division 3D encompasses the following new sections:

– 	new s.30DS defines a cancellation notice and suspension notice, prescribed offence, and register;

–	new ss.30DT and 30DU provides for the regulations to prescribe the offences to which the scheme will apply, the number of points per offence, and the classes to which particular authorisations belong according to the activities to which they relate;

–	new s.30DV provides a regulation-making power;

–	new s.30DW details when demerit points will be incurred;

–	new s.30DX provides for demerit points to attach in relation to a class of authorisations;

–	new s.30DY deals with the first-time suspension of an authorisation under this scheme, requiring CASA to issue a suspension notice in respect of all authorisations in the relevant class of authorisations, where the authorisation holder has incurred 12 or more demerit points in relation to the same class of authorisations in the three years prior to the day the offence that took him to, or over, the limit was committed.  s.30DY sets out the suspension periods for the first three-year period:

•	12-15 points		90 days   (3 months)
•	16-19 points		120 days (4 months)
•	Otherwise		150 days (5 months)

–	new s.30DZ deals with the second-time suspension, requiring CASA to issue a suspension notice in respect of all authorisations in the relevant class of authorisations, where the authorisation holder has incurred 6 or more demerit points in relation to the same class of authorisations in the three years prior to the day the offence that took him to, or over, the limit was committed.  s30.DZ sets out the suspension periods for the second three-year period:

•	6 – 9 points		90 days   (3 months)
•	10-13 points		120 days (4 months)
•	Otherwise 		150 days (5 months)

–	new s.30EA provides for the details that must be included in a suspension notice;

–	new s.30EB provides that where the suspension of an authorisation in a particular class of authorisations has effect under another provision of the Act or the regulations, the time of that suspension does not count towards a suspension period invoked under this scheme.  For example, if at the time a 90-day suspension under this scheme comes into force, another suspension of one of the authorisations affected by the demerit point suspension has been stayed under s.31A and the AAT upholds the other suspension for a period of 30 days, the 30 days do not count towards the demerit point suspension.  The intention is that both suspensions must run their course and must be served in full;

–	new s.30EC requires CASA to issue a cancellation notice in respect of all authorisations in the relevant class of authorisations, where the authorisation holder has incurred 6 or more demerit points in relation to the same class of authorisations in the three years prior to the day the offence that took him to, or over, the limit was committed, and the authorisation holder has been given a suspension notice twice before.  The cancellation will be in effect for three years from the date of the notice and the authorisation holder will not be entitled to apply for, or be granted, an authorisation of the same class during that time (although there is scope for cancelled/suspended authorisations to be reinstated under s.30EF);

–	new s.30ED provides for the details that must be included in a cancellation notice, including that the commencement of the cancellation period must not be earlier than 28 days after the date of the notice;

–	new s.30EE provides that all demerit points that contribute to a suspension or cancellation are to be disregarded for the purposes of subsequent calculations of demerit points;

–	new s.30EF allows CASA to reinstate a particular authorisation that has been suspended or cancelled under this scheme, with special conditions, if it satisfied that the suspension or cancellation of that authorisation will cause the authorisation holder severe financial hardship;

–	new s.30EG requires CASA to maintain a register in which to record demerit points in line with the Privacy Principle 11 of the Privacy Act, and to amend the register as necessary.  s.30EG also provides that other matters relating to the register will be dealt with under the regulations;

–	new s.30EH allows CASA to keep a record of information obtained and action taken under this scheme.  This is essential for assisting CASA to determine where a suspension notice or a
cancellation notice is required;

–	new s.30EI sets out the information to be recorded in the demerit point register; and

–	new s.30EJ requires CASA to remove demerit points that are no longer relevant from the demerit point register.

Item 16 – Subsection 31(1)

Item 16 amends subsection 31(1) of the Act by providing that a decision by CASA in regard to an application for reinstatement of an authorisation under s.30EF will be reviewable by the AAT.  Item 16 also excludes a decision by CASA to immediately suspend an authorisation under new Division 3A from AAT review as the current scheme does not permit such a decision to be reviewed due to the seriousness of the situations that warrant such action.  A suspension or cancellation under Division 3D is also excluded from AAT review as the scheme is a self-executing, non-discretionary scheme.  

Item 17 – Section 31

Item 17 amends s.31 of the Act by inserting new provisions that provide an automatic stay of CASA’s decision to suspend, vary or cancel an authorisation in cases other than a serious and imminent air safety risk.

New s.31A provides that the operation of a decision made following a show cause notice will be automatically stayed and will continue in force until the end of the fifth business day after CASA notifies its decision unless the authorisation holder applies for an AAT review before the end of the fifth day.  Where an authorisation holder applies for a review the stay will continue in force until the AAT makes its decision, or until the end of the 90th day after CASA notified its decision, whichever occurs first.  s.31A also requires the authorisation holder to provide CASA with a copy of their AAT application, and provides that the authorisation holder can seek a further stay under normal AAT procedures during the automatic stay period for a further stay in case the AAT does not making its decision within the 90-day automatic stay period.

New s.31B provides that an automatic stay will lapse if the authorisation holder withdraws their review application, and it requires an authorisation holder to advise CASA of such a withdrawal.

New s.31C clarifies that s.31A will not effect the powers of the AAT to grant a stay under its normal procedures.

New s.31D provides that the automatic stay provisions in s.31A will not prevent CASA from taking immediate suspension action under the new s.30DC against an authorisation holder who has an automatic stay.  This is intended to ensure that CASA’s powers to deal with cases involving a serious and imminent safety risk are not diluted by virtue of the automatic stay provisions.

Item 18 – Section 32

Item 18 omits the reference to the Board in s.32 of the Act and substitutes it with a reference to the Director.  This is a consequence of the abolition of the Board.

Item 19 – Part IV

Item 19 repeals Part IV of the Act so as to give effect to the abolition of the Board.

Items 20, 21, 22 and 23 – Sections 44 and 45

Items 20, 21 and 22 amend subsections 44(1), 44(3), 44(6), 45(2) and 45(5) of the Act to replace the Board’s responsibility for preparing CASA’s corporate plan, and transfers that responsibility to the Director.  Items 20 and 23 also amend subsections 44(1) and 45(5) to formalise the Minister’s power to approve the corporate plan.

Item 24 – Paragraph 49(2)(a)

Item 24 amends paragraph 49(2)(a) of the Act to add a reference to the new s.12D.

Item 25 – Section 49

Item 25 makes consequential amendments to s.49 of the Act as a result of the abolition of the Board, to replace references to the Board with references to the Director throughout the section.

Item 26 – Subsection 84(1)

Currently, s.84(1) of the Act requires the Minister to obtain a recommendation from the Board prior to appointing a Director.  As the Board is being abolished, Item 26 will substitute this requirement with a requirement that the Minister receive a report from the Secretary prior to appointing the Director.  This provision is intended to provide procedural fairness in line with the appointment of Portfolio Secretaries under s.58 of the Public Service Act 1999.

Item 27 – Subsection 84(2)

It is current practice that the position of Director is a full-time position.  Item 27 inserts a new provision to subsection 84(2) of the Act to explicitly provide that the position is full-time.  The provision is considered necessary so as to clarify that the position cannot be anything other than a full-time position.

Items 28, 29, 30 and 35 – Subsections 84(3) and 84(4), Section 86

The Board is currently the employing body of the Director for the purposes of the Remuneration Tribunal Act 1975.  With the abolition of the Board, the Minister will become the employing body.  Items 28, 29, 30 and 35 amend subsections 84(3), 84(4) and s.86 of the Act to provide for this change, to provide that the Minister will set the terms and conditions of the Director’s employment, and to clarify that s.86 will have no effect when a determination under s.12C of the Remuneration Tribunal Act is in force.

Item 31 – Subsection 84A(1)

With the abolition of the Board, Item 31 amends subsection 84A(1) of the Act to provide that the Director will responsible to the Minister for managing CASA.

Item 32 – Section 84A

Item 32 provides that the Director is the Chief Executive Officer of CASA. 

Item 33 – New Section 84B

Item 33 creates a new subsection 84B setting out the Director’s new responsibilities for deciding CASA’s objectives, strategies and policies; ensuring CASA complies with Ministerial directions; and ensuring CASA acts in accordance with the Minister’s views under s.12A.  Item 33 also creates a new subsection 84C that deals with the Director’s disclosure responsibilities.

Item 34 – Section 85

Item 34 amends s.85 of the Act to provide that the Director must seek the Minister’s consent to engage in external employment.

Item 35 – Section 86

Item 35 adds a drafting note explaining that s.86 has no effect if a determination is in force under the Remuneration Tribunal Act 1973.

Item 36 – Section 87

Item 36 amends s.87 of the Act to provide that the Minister, in place of the Board, will be responsible for approving leave of absence for the Director. 

Item 37 – Section 88

With the abolition of the Board, Item 37 provides that the Director may resign by written notice to the Minister.

Items 38 and 39– Section 89

With the abolition of the Board, Item 38 amends s.89 of the Act to provide that the Minister must receive a report from the Secretary prior to terminating the Director.  This provision is intended to provide procedural fairness in line with the dismissal of Portfolio Secretaries under s.59 of the Public Service Act 1999, while preserving the position that the Director holds office at the employing authority’s pleasure.

Items 40 and 41 – Subsections 90(1) and 90(2)

Items 40 and 41 amend subsections 90(1) and 90(2) of the Act to remove the references to the Board and provide that the Minister may appoint an acting Director.

Item 42 – Section 91

Item 42 amends s.91 of the Act to provide that the Director will be responsible for setting the terms and conditions of CASA staff as a consequence of the abolition of the Board.

Item 43 – Section 94

Item 43 repeals the Board’s existing power of delegation under s.94 and substitutes it with the Director’s new power to delegate all or any of CASA’s powers to an officer.

Item 44 – Section 94A

Item 44 amends s.94A of the Act to provide that the Minister may delegate minor and administrative powers under ss.85, 87 and 90 to the Secretary, and to require the Secretary to comply with the Minister’s directions. 

Items 45 and 46 – Section 96

Items 45 and 46 will amend s.96 of the Act by amending the heading and requiring that the Minister’s directions regarding reporting arrangements under the new s.12D and any agreement between the Minister and the Director under the new s.12C, must be tabled in Parliament. 

Item 47 – Subsection 97AB(5)

Item 47 will repeal the definition of an external service provider under s.97AB(5)(a) of the Act as a consequence of the abolition of the Board.

Item 48 – Subsection 98(3B)

Item 48 removes a reference to ‘member’ in subsection 98(3B) of the Act as a consequence of the abolition of the Board.