2019-2020 annual report — 2019 - 2020 AIRSERVICES ANNUAL REPORT PUBLICATION DETAILS DIGITAL ACCESS Published by Airservices Australia. Online access is available at: https://www.airservicesaustralia.com/ © Airservices Australia 2020 corporate-publications/ PUB 001 - Airservices Australia Annual Report 2019–20 ISSN 1325-2755 (hard copy/print) PUBLICATION CONTACT ISSN 2207-5925 (online) Enquiries concerning reproduction rights should be ABN 59 698 720 886 addressed to: This report was presented for tabling in both Houses of Enterprise Reporting and Content Manager Parliament of the Commonwealth of Australia. Airservices Australia This work is copyright. Apart from any use as permitted GPO Box 367 under the Copyright Act 1968, no part may be reproduced Canberra City ACT 2601 by any process without prior written permission from Telephone: (02) 6268 4374 Airservices Australia. Email: [email protected] Web: www.airservicesaustralia.com PUBLICATION ACKNOWLEDGMENTS We proudly support small businesses and thank them for their contributions to the publication of this report. Graphic design: Prodigy Plus Digital design: Lamb Agency Print publication: Instant Colour Press 2 CONTENTS contents 6 36 CHAIRMAN’S REPORT OUR FINANCIAL STATEMENTS 8 96 CHIEF EXECUTIVE OFFICER’S REPORT GOVERNANCE AND ACCOUNTABILITY OUR BOARD AND COMMITTEES 97 OUR BUSINESS ORGANISATIONAL STRUCTURE 107 10 OUR GOVERNANCE 108 OUR YEAR IN REVIEW OUR WORK HEALTH AND SAFETY PERFORMANCE 112 OUR EQUITY AND DIVERSITY APPROACH 117 ENVIRONMENTAL MANAGEMENT AND PERFORMANCE 123 14 OUR ROLE AND RESPONSIBILITIES 130 APPENDICES APPENDIX A: 18 MINISTERIAL EXPECTATIONS 132 OUR PERFORMANCE APPENDIX B: AIRSERVICES REMUNERATION REPORT 2019–20 135 ANNUAL PERFORMANCE STATEMENT 18 APPENDIX C: SAFETY PERFORMANCE 22 AIRCRAFT NOISE OMBUDSMAN ANNUAL REPORT 2019–20 143 INDUSTRY OUTCOMES 24 APPENDIX D: BUSINESS OPERATIONS EFFICIENCY 26 COMPLIANCE INDEX 166 ORGANISATIONAL CAPABILITY 28 FINANCIAL STEWARDSHIP 30 OUR CORPORATE PLAN INITIATIVES 32 3 2019 - 2020 AIRSERVICES ANNUAL REPORT Letter of transmittal 4 LETTER OF TRANSMITTAL Chairman GPO Box 367, Canberra ACT 2601 25 Constitution Avenue, Canberra ACT 2601 t 02 6268 4959 www.airservicesaustralia.com ABN 59 698 720 886 The Hon Michael McCormack MP Deputy Prime Minister and Minister for Infrastructure, Transport and Regional Development Parliament House CANBERRA ACT 2600 Dear Deputy Prime Minister Airservices Annual Report 2019–20 On behalf of the Board of Airservices Australia, I am pleased to submit to you the Airservices Australia Annual Report for the financial year 2019–20 as required under section 46 of the Public Governance, Performance and Accountability Act 2013 (PGPA Act). During 2019–20 we were accountable to the Australian Parliament and to the Australian Government through your portfolio as the Minister for Infrastructure, Transport and Regional Development. The Board, as the accountable authority of Airservices Australia, is responsible for preparing and submitting this report to you. It was endorsed at our meeting on 16 September 2020. The report has been prepared in accordance with the requirements of the Air Services Act 1995, the PGPA Act, the Public Governance, Performance and Accountability Rule 2014 (PGPA Rule), and other relevant legislation. This report outlines the achievements and milestones met by Airservices, and includes a review of operations and financial statements for the year ending 30 June 2020. The performance statement has been prepared to demonstrate our performance over the 2019–20 period against the Airservices 2019–20 Corporate Plan. It reports against our key performance measures and initiatives articulated within the Plan. The appropriateness of the performance statement was reviewed by Airservices Board Audit and Risk Committee at its meeting on 7 September 2020. In the Board’s opinion, the annual performance statements are based on properly maintained records, accurately reflect the performance of the entity, and comply with subsection 39(2) of the PGPA Act and section 16F of the PGPA Rule. Yours sincerely John Weber Chairman 16 September 2020 5 2019 - 2020 AIRSERVICES ANNUAL REPORT CHAIRMAN'S REPORT The 2019-20 reporting period has been both historical and unique, a true exemplar of the notion that every great challenge brings equal opportunity. Events such as a devastating bushfire season and Therefore, it is essential Airservices continues its the rapid spread of the COVID-19 pandemic across the preparations for the future, even as we manage the globe will ensure this year is long remembered as a immediate disruption. It is clear we have a leading role to watershed moment for our organisation, the aviation play in supporting the recovery of the commercial airline industry and the nation we serve. industry as well as facilitating safe and efficient growth over the longer term. Just 12 months ago, a significant focus of the Airservices strategy was preparing for steady long-term growth in the Delivery of OneSKY, Australia’s harmonised civil and commercial airline industry, with passenger movements military air traffic management system in partnership expected to double by 2040. with Defence, remains on track. This world-leading program is expected to unlock more than $1.2 billion in Of course, these forecasts have now fundamentally economic benefits for our customers and the aviation shifted. As part of a suite of measures to manage the industry over the next 20 years. COVID-19 pandemic, Australia’s international borders have been closed since March 2020, and at the time of Meanwhile, the very factors that have brought such writing were expected to remain shut until at least 2021. significant disruption to one part of the industry are The states and territories have also introduced various creating opportunity elsewhere. domestic border closures and restrictions on movement. The COVID-19 pandemic has only amplified demand For the most part, the people of Australia are staying for the services that could be provided by autonomous close to home. vehicles. One such forward-looking scenario is a drone The resulting 58.5 per cent decrease in traffic in delivering food and medical supplies to a person in Quarter 4 2019-20 compared to Quarter 4 2018-19, has mandated quarantine; another is where the risk of had an immediate and devastating impact on our airline transmission during an outbreak is high, an essential customers. Although an eventual return to the previous worker travels to and from their workplace via unmanned growth trajectory is expected, it may take some years aerial taxi rather than risk mass public transport. given reduced discretionary spending and demand for business travel. 6 CHAIRMAN’S REPORT Our work to integrate these new entrants into Australia’s airspace continues at pace and will grow in focus over the “ It is essential next 12 months and beyond. Airservices continues We also recognise the need to exercise exceptional financial stewardship as we work to deliver value to our its preparations for customers, particularly amidst the current challenges. We have been continually improving the efficiency of our the future, even as we operations since 2016, culminating in our announcement on July 1 2019 of a 2 per cent reduction in airways service manage the immediate charges. Early in the current reporting period we also returned disruption” a $200m capital repayment to our shareholder, the Australian Government, for the benefit of the wider Australian community. I am privileged to present the Airservices 2019-20 Annual Report. While the challenges of the past 12 months have been undeniable, we have risen to the occasion and stand ready to support the industry during its recovery from the impacts of the COVID-19 pandemic, and on the journey to the safe, efficient and prosperous future that lies beyond. John Weber Chairman 7 2019 - 2020 AIRSERVICES ANNUAL REPORT CHIEF EXECUTIVE OFFICER'S REPORT The Airservices mandate is a straightforward one. We are charged with ensuring the safe, reliable and efficient use of airspace for all users through the provision of services that are valued by the industry. In 2019-20, we delivered on that mandate to a standard of These cost reduction initiatives and other efficiency excellence, every day, without exception. For the fourth measures are ongoing as we continue to provide our year in a row we recorded zero significant attributable customers with value at a time when they need it the safety occurrences, further proving that Australia sets the most. global benchmark for aviation safety standards. Of course, our focus on financial sustainability is During a disruptive year, our air traffic management staff balanced with the work we need to prepare for the aviation safely handled more than 3.5 million aircraft movements ecosystem of the future. Our mandate is to facilitate safe and our fire fighters saved 11 lives. Our Lost Time Injury and efficient airspace access for all users, a responsibility Frequency Rate continued to trend downwards, returning that starts at ground level and has no upper limit. the strongest result for Airservices in the past five years. Demand for unmanned aerial vehicles (UAVs) and other We achieved these exceptional safety outcomes despite new technologies for access to our airspace has never the well-documented challenges in the external been higher, and we are working with government and environment. We were proud to support Australia’s co- industry partners to facilitate their safe and productive