CEO Direct — Service interruptions
Wednesday, 30 July 2008

The environment we are operating in

Over the next few days there will be further media on the issue of service interruptions, current and future staffing levels and associated issues. It is very important for the management team and I to provide you with a clear position on the central issues that are involved.

Our revenue — the money that pays our salaries, our operating costs and enables investment in new technology, equipment and facilities — is largely received from the aviation industry and in particular our airline customers. This industry is suffering unprecedented upheaval due to huge rises in fuel costs, both internationally and here in Australia.

For our top two customers, that means reductions in their capacity by between 5 and 10%. Our major customer, Qantas, is meeting the cost increases head on by reducing its workforce by 1,500 people and not hiring a further 1,200. At the same time, Qantas recently signed new collective agreements containing a pay increase of around 3% per annum for five years. Based on these factors, it is almost certain that we will receive less revenue from our airline customers in the coming year.

In this environment I restate our intention to provide a reasonable pay rise to our staff in recognition of cost of living increases, productivity improvements and bearing in mind the current Australian labour market. We are currently holding discussions with our various unions to try and achieve an early settlement of three Collective Agreements — for our fire fighters, air traffic controllers, engineers, technicians and specialists, and our corporate staff.

I have proposed, unlike earlier years, that there be tightly focussed negotiations in August and September. This means if we can successfully conclude negotiations, obtain approval from staff and get the necessary sign offs by Government and the Workplace Authority by the end of September; we could bring the first of the salary increases to staff in October pay packets. Current situation Unfortunately, however, in recent months service interruptions are diverting attention from trying to achieve this outcome.

For months I have resisted getting into a public slanging match, but I have become increasingly concerned by the number of service interruptions, and in particular Traffic Information Broadcast by Aircraft (TIBA) situations and the reputational damage this is causing to the air traffic control profession and our organisation as well as inconvenience to our customers and the Australian travelling public. It is now clear that a small number of Air Traffic Controllers are deliberately imposing these service interruptions on the aviation industry as part of an unsanctioned campaign associated with the current Collective Agreement negotiations.

I would like to stress that I do not believe this campaign is endorsed by Civil Air or supported by a majority of our dedicated and professional ATC staff — the silent majority who continue to run our world-class air navigation service. I want to thank them for maintaining the system during the recent spike in TIBAs. I simply do not accept that the current spate of service interruptions is solely related to short staffing as has been claimed. Only six of the 20 sector groups that have experienced TIBA since October last year are below their required complement and we are addressing, as a matter of urgency, those sectors below their required number. The current shortfall of 17 operational ATCs is being addressed through our comprehensive recruitment and training program.

At this stage, we anticipate this will achieve a full staffing complement by the end of August, with new controllers flowing into the system over the coming months. This is just the beginning of our increased recruitment activities with a further 80-100 ATCs to be recruited per year over the next five years. This is a central plank in the reform of the ATC core business.

My primary objective is to resolve the Collective Agreements which are now under negotiation in a timely and constructive manner, with due regard to the Federal Government’s position on inflationary pressures and the framework it has set down for enterprise bargaining.

I ask that unnecessary distractions such as the service interruption campaign cease and ask that those involved abandon their tactics and work cooperatively with their union. Airservices will not be pressured into an irresponsible outcome that does not balance the needs of our owner, our staff and the aviation industry.

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Peter Fray
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