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Inquiry Into the Economic and Security Challenges Facing Papua New

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Inquiry Into the Economic and Security Challenges Facing Papua New INQUIRY INTO THE MAIN ECONOMIC AND SECURITY CHALLENGES FACING PAPUA NEW GUINEA AND THE ISLANDS STATES OF THE SOUTHWEST PACIFIC SENATE STANDING COMMITTEE ON FOREIGN AFFAIRS, DEFENCE AND TRADE SUBMISSION BY THE DEPARTMENT OF INFRASTRUCTURE, TRANSPORT, REGIONAL DEVELOPMENT AND LOCAL GOVERNMENT October 2008 INQUIRY INTO THE MAIN ECONOMIC AND SECURITY CHALLENGES FACING PAPUA NEW GUINEA AND THE ISLANDS STATES OF THE SOUTHWEST PACIFIC SUBMISSION BY THE DEPARTMENT OF INFRASTRUCTURE, TRANSPORT, REGIONAL DEVELOPMENT AND LOCAL GOVERNMENT Comments addressing term of reference a(i): the implication for Australia of the major economic and security challenges facing Papua New Guinea and the island states of the southwest Pacific. Overview: aviation safety and security 1 Safe and secure aviation services are crucial to Papua New Guinea (PNG) and the island states of the southwest Pacific, which depend on them for their economic wellbeing and growth. In much of PNG and the Pacific, air services are the primary means of connectivity. Without them both economic development and normal social interaction would be impossible. 2 The safety and security of these services are also important to Australia. Many Australians travel through the Pacific region and PNG and Pacific airspace is contiguous to Australia’s (which itself covers 11 per cent of global airspace). 3 The Pacific aviation sector faces numerous challenges. The sector is struggling with rising fuel costs and is vulnerable to economic downturns. The recent entry of low- cost carriers has led to some reduction in airfares and significant increases in passenger traffic. But the sector continues to face challenges typical of remote and regional services, including servicing a number of non-commercially viable routes to smaller states. It is becoming increasingly difficult for small and government-owned regional carriers to remain viable in the current market conditions. 4 Australia views the international aviation security network as an interconnected system – any weaknesses in the system, especially at airports from which direct flights depart to Australia, can affect the security of Australia’s aviation sector. Accordingly, strengthening Pacific aviation security is a matter of national interest. 5 Challenges for aviation security in PNG and the Pacific include a lack of funding, infrastructure and equipment, and a paucity of appropriately trained people at all levels. 6 The Department of Infrastructure provides aviation security support in PNG and the Pacific through: • support of regional organisations, such as the Pacific Aviation Safety Office (PASO) and ICAO’s Cooperative Aviation Security Programme (Asia/Pacific); • staff exchanges of aviation security regulator personnel; • aviation security training and, in some circumstances, the provision of equipment, in partnership with the New Zealand Aviation Security Service. 2 Papua New Guinea (PNG) 7 PNG is Australia’s closest neighbour. As a last port of call, and with a high number of transiting Australians, aviation safety and security in PNG continues to be of significant national importance to Australia. 8 PNG’s capacity to manage its civil aviation regulatory functions has been a longstanding source of concern. A decade ago the Australian Civil Aviation Safety Authority (CASA) began issuing short term Air Operator’s Certificates (AOC) to PNG airlines flying into Australia due to a lack of confidence in PNG’s safety oversight. Under this approach, before being authorised to operate into Australia PNG airlines had to be independently audited every three to six months. The PNG regulatory authority, the Civil Aviation Authority (CAA), had considerable debts and was depending on PNG Government subsidies to pay salaries, and on donor funds for airport maintenance. 9 A 2004 review of security arrangements at PNG’s Jackson’s International Airport identified a significant number of deficiencies in meeting minimum international security standards. Australia’s placements under the AusAID funded Enhanced Cooperation Program (ECP) have brought about significant improvements to aviation security management and systems. But engagement under the successor Strongim Gavman Program (SGP) will be essential to maintaining and building on these achievements. Enhanced Cooperation Program (ECP) 10 In 2004 the then Department of Transport and Regional Services (DOTARS) placed Australian officials in the positions of Deputy Chief Executive Officer and Aviation Security Adviser in the CAA under the ECP. This support has helped to stabilise the situation and, in particular, led to organisational reform, improved delivery of services and better compliance with international safety and security standards. Some specific achievements include: • an improvement in the CAA’s application of aviation safety standards leading to CASA granting PNG airlines AOCs for periods of 12 months; • improvements in fiscal processes and management leading to the CAA recording a profit and retiring K$17 million in debt; • a 50 per cent reduction in non-core staff; • a memorandum of cooperation between Airservices Australia and the CAA (signed in January 2007) covering the provision of guidance and support on airspace safety; and • restructure of the CAA into three separate entities: PNG Air Services Limited, an aviation safety and security regulator (which will retain the CAA title), and an Airports Corporation. 11 There is, however, some distance to go before sustainable capability is realised – ongoing support from the Australian Government will be necessary for the medium to long-term. Recent media coverage of deficiencies in aviation accident investigation in PNG highlights the continuing need for such assistance. 3 Nauru 12 Nauru’s only aircraft, operated by ‘Our Airline’, is registered in Australia by CASA. ‘Our Airline’ operates under an Australian AOC renewed annually. The airline continues to face financial challenges and struggles to maintain operations without subsidisation. 13 Nauru was audited under the International Civil Aviation Organization (ICAO) Universal Safety Oversight Audit Program (USOAP) in March 2008. The audit results are not yet known. AusAID, with technical input from CASA, is funding the purchase of two vehicles that meet international (ICAO) aerodrome fire fighting standards. Overview: maritime security 14 The maritime sector in the Pacific has an important role in addressing poverty in the region. Many Pacific Islanders rely on the sea for employment. Regular remittances from seafarers working on vessels that trade internationally comprise more than 25 per cent of gross national product (GNP) in some countries. This income allows many families of seafarers to remain in their villages rather than seek employment in urban centres, thereby reducing migration pressure. 15 Maritime security is an essential enabler for international trade and economic development, as recognised in the Pacific Islands Forum Principles on Regional Transport Services. The Department of Infrastructure has sought to engage consistently with the region on maritime security issues, supporting regional countries and regional organisations to improve security. 16 The Pacific maritime security model of jointly building capacity, developing policy and auditing is unique and allows for strong cooperation among regional states. But despite the progress to date, there are still significant shortcomings in the region’s preventative security regimes. Future work will need to focus on strategic policy as well as operational capacity building. 17 The goal for Australian support is to see the establishment of maritime security regimes in the region that: • improve compliance with the International Ship and Port Facility Security (ISPS) Code; • increase maritime security governance capacity to implement ISPS Code preventative security arrangements; and • improve governance arrangements for the development of a regional maritime security agenda. 18 The contribution by the Department of Infrastructure is in two main areas: • providing maritime security expertise and support through ECP, its successor and other Australian aid programs in PNG; and • supporting regional partner organisations such as the Secretariat of the Pacific Community Regional Maritime Program, which seeks to achieve a coordinated and consistent approach to maritime security across the 22-member Pacific Community. 4 Comments addressing term of reference a(ii): how the Australian Government can, in practical and concrete ways, assist these countries to meet the challenges facing Papua New Guinea and the island states of the southwest Pacific. 19 The Department of Infrastructure will continue its practical assistance to PNG and the broader Pacific region to enhance aviation and maritime safety and security. This assistance will be through bilateral aid programs with key regional countries and broader assistance to regional organisations, including PASO and the Pacific Island Air Services Agreement (PIASA). 20 In the aviation area, our focus is on increasing the capacity of regional states to meet ICAO standards and recommended practices. ICAO will audit PNG and other regional states over the next couple of years as part of its audit program of national safety oversight systems. These audits will be useful in assisting to identify trends in safety oversight. Strongim Gavman Program (SGP) 21 The Australian and PNG Governments have agreed on a successor program to the ECP, the Strongim Gavman Program (SGP). The Department of
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