Bills Digest no. 98 2007–08
Sydney Airport Demand Management Amendment Bill
This Digest was prepared for debate. It reflects the legislation as
introduced and does not canvass subsequent amendments. This Digest
does not have any official legal status. Other sources should be
consulted to determine the subsequent official status of the
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Sydney Airport Demand Management
Amendment Bill 2008
House: House of Representatives
Portfolio: Infrastructure, Transport, Regional
Development and Local Government
The substantive provisions
commence 6 months from the day of Royal Assent or earlier by
relevant links to the Bill, Explanatory Memorandum and
second reading speech can be accessed via BillsNet, which is at
When Bills have been passed they can be found at ComLaw, which is
The Bill amends the Sydney Airport Demand
Management Act 1997 removing technical inconsistencies in key
terminology, so as to clarify and strengthen the regulatory
arrangements relating to the demand management scheme.
Demand Management Act 1997
The Sydney Airport Demand Management Act
1997 (SADM Act) provides the framework for the long-term
management of aviation demand at Sydney Airport. The SADM Act is
intended to meet the commitment made by the Howard Government prior
to the March 1996 Federal election that aircraft movements at
Sydney Airport would be capped at 80 per hour. In this respect, the
requirements of the SADM Act take precedence over voluntary
coordination practices advocated by the International Air Transport
Association (IATA), and in place at other major Australian
The SADM Act requires Airservices Australia to monitor actual movements and to
report quarterly to the Minister for Transport and Regional
Services on the extent of infringements of the 80 per hour limit in
The SADM Act limits aircraft movements at Sydney Airport to a
maximum of 80 per hour. Each arm of the operational requirements
created by the SADM Act is put into effect by legislative
instruments made under the Act. The two most important are:
- The Slot Management Scheme, under which
aircraft operators are required to seek a slot (a permission to
undertake an aircraft movement) from the Slot Manager
- The Compliance Scheme, which requires
operators to carry out authorised aircraft movements within a
prescribed tolerance period before or after the scheduled slot
time. The Compliance Scheme also deals with certain matters
concerning the application of penalties to aircraft operators who
operate aircraft without a slot or outside of the prescribed
The combined action of these two instruments is intended to
implement the movement limit, by controlling the scheduling of
aircraft movements under the Slot Management Scheme and requiring
timely performance through the Compliance Scheme.
In 2006 the Australian National Audit Office (ANAO) undertook an
audit to assess the performance of the Demand Management Scheme
established under the existing legislation. The Report was
finalised on 7 March 2007.
Amongst other things, the ANAO analysis showed that:
- Elements of the legislative scheme are unclear, do not operate
in the way intended or are ineffective.
- There is evidence of a high number of unauthorised aircraft
movements (i.e. movements without a slot and movements outside the
slot tolerances) having occurred at Sydney Airport. However, since
the scheme commenced in 1998, no infringement notices have been
issued to operators or other penalties applied.
- There is evidence to suggest that record keeping has been
unreliable and consequently reporting and monitoring of breaches of
the aircraft movement limit to Parliament through the Minister have
therefore been inaccurate.
The Bill is aimed at addressing the first of
The concept of aircraft movement underpins the operation of the
demand management scheme. In this respect, valid and effective
definitions of aircraft movement are necessary to underpin:
- the allocation of slots
- the enforcement of compliance with the requirement to have a
slot and operate in accordance with the allocated slot time,
- incumbent aircraft operators retaining historical precedence to
slots they have previously operated.
The definition of aircraft movement in the SADM Act relates to
movements of aircraft on and off runways. Airservices
Australia s monitoring of the movement limit accords with this
However a different definition is used to administer the Slot
Management Scheme and the Compliance Scheme. This definition
relates to movements from gates, and was adopted for ease
of administration by the industry. During the course of the audit, ANAO drew
attention to this inconsistency in the definition/interpretation of
aircraft movement, which is fundamental to the effectiveness of the
demand management scheme.
Legal advice subsequently obtained by the Department of
Transport and Regional Services (DOTARS) was that:
In so far as the definitions in the Compliance
Scheme are inconsistent with the Act, they are invalid and of no
effect. However, while this invalidity has important consequences
for the administration of the SADM Act, the Slot Management Scheme
and the Compliance Scheme, I do not think that it necessarily makes
the Act unworkable or the Schemes as a whole invalid or otherwise
ANAO recommended that in view of the importance of valid and
effective aircraft movement definitions to the demand management
scheme, DOTARS take steps to ensure consistency between the
Compliance Scheme and the SADM Act.
DOTARS agreed with this recommendation stating:
The Department has initiated action to seek
agreement to the passage of legislative amendments to improve
consistency between the Act and the Compliance Scheme.
The key change proposed by the Bill is to introduce a
distinction between aircraft movements on the runway and aircraft
movements at the gate. The distinction is significant because the
slot management scheme as set out in the regulations is based on
gate movements and the movement limit (i.e. 80 per hour) applies to
The proposed amendments would overcome the flaw identified in
the ANAO audit that the day-to-day administration of slot
allocation and compliance do not technically comply with the
current SADM Act. More particularly, the term aircraft movement is
interchangeably used to describe the two separate but related
The Minister s second reading speech emphasises that the Bill
does not change any of the fundamental policy settings but rather
the amendments are essentially technical and will clarify,
strengthen and tighten the regulatory arrangements.
There will be no financial impact.
Existing section 4 provides a summary of the various Parts
contained in the SADM Act. Items 1-3 would amend
the section to reflect the changes proposed by the Bill.
Item 1 clarifies that the maximum movement limit
at Sydney Airport is specifically related to aircraft
movements. Item 2 specifies that penalties in
Part 3 relate to unauthorised gate movements and
not to unauthorised aircraft movements.
Item 3 adds that Part 5 (Compliance Scheme) will
also deal with the power of the Minister to determine modifications of the
Section 6 is the central provision of the Act. It restricts the
aircraft movements to a maximum of 80 in any regulated hour of
airport operation. Hourly movements are measured at 15 minute
intervals. A regulated hour is defined to exclude any curfew
period. Regulation within the curfew period is covered by a
separate statute, the Sydney Airport Curfew
Act 1995 (the Curfew Act). Items 4 and
5 amend section 6 clarifying
terminology relating to aircraft movement.
Item 6 corrects a drafting error in subsection
8(4). It replaces a reference to the Legislative Instruments
Act 1997 with Legislative Instruments Act 2003.
Item 38 makes an identical amendment to subsection
Items 7 24 propose amendments to Part
3, which is the Part setting out the penalty regime for
the Slot Management Scheme. The majority of these amendments would
replace the term aircraft movements with the concept of gate
movements . For example item 7 amends the title of
Part 3 so that it would read Part 3 Penalties for unauthorised gate
movements . Item 8 repeals and replaces section 10
setting out the gate movements (as opposed to the aircraft
movements) to which Part 3 would apply. With the exception of
certain movements that are exempt under the Act, Part 3 will apply
to all gate movements (as opposed to aircraft movements)
at Sydney Airport.
Existing part 4 (sections 33 to 47) sets out
the Slot Management Scheme. It is, essentially, a system for the
allocation of permission for an aircraft movement at Sydney Airport
within the maximum aircraft movement limit of 80 per regulated
hour. A slot is issued for a specified aircraft movement at a
specified time on a specified day. Again many of the amendments to
Part 4 relate to terminology and will replace the term aircraft
movement with gate movement .
For example, existing subsection 33(2) sets out that the basic
purpose of the Slot Management Scheme is to provide a system for
the allocation of permissions for aircraft movements at Sydney
Airport within the maximum movement limit (aircraft movements being
defined as runway movements). Item 25 amends
subsection 33(2) so that the basic purpose of the Scheme would be
to provide a system for the allocation of permissions for gate
movements. The system must be consistent with the maximum
movement limit of 80 aircraft movements.
Section 34 deals with the concept of a slot and is amended by
items 26 and 27 so that a slot
would be a permission for a scheduled gate movement
(rather than an aircraft movement). A slot allocated will
permit a specified gate movement at a specified time on a specified
day. Item 28 repeals and replaces subsection 34(3)
so that other laws will apply to gate movements as well as aircraft
movements. Section 35 deals with the contents of the Slot
Management Scheme. Items 29, 31 and
34 make similar amendments to this section,
replacing the term aircraft movements with gate movements .
Item 30 amends subsection 35(1) to remove the
reference to other than movements during the curfew period . The
rationale being that this is an unnecessary phrase as slots cannot
be allocated for movement during the curfew period. The curfew
period is dealt with under the Curfew Act.
New subsection 35(1B) is inserted by
item 32. It clarifies that the Scheme must not
allow slots to be allocated for times during curfew periods.
Part 5 of the Act (sections 48 59) deals with
the Compliance Scheme for the Slot Management Scheme. Item
40 would repeal subsection 49(6) to remove the requirement
that the Compliance Scheme must include definitions of when an
aircraft takes off or lands. The definitions are no longer
necessary as the Schemes are based on a concept of gate movements
rather than take offs and landings.
Item 41 proposes new section
59A giving the Minister a new power to make modifications
to the Compliance Scheme in exceptional circumstances. The
modifications would be made via a determination which must be given
to the Compliance Committee as soon as practicable. The
determination must set out the Minister s reasons for the
modifications. The determination would be a legislative instrument
but not subject to disallowance by the Parliament. New
subsection 59A(4) clarifies that modifications made by the
Minister under this section do not have to comply with the
Compliance Scheme. The Explanatory Memorandum states that
exceptional circumstances will be events, such as major changes to
the operations of all airlines for reasons beyond the airlines
control, that impact on airline on-time performance for a period of
time. It cites as examples the collapse of Ansett in 2001 and the
events immediately following September 11, 2001.
Part 8 of the Act deals with miscellaneous
matters including Ministerial delegations. Section 71 allows the
Minister to delegate certain powers to the Secretary and Senior
Executive Service officers in the Department. Item
44 amends section 71 so that the Minister may also
delegate the power to make appointments to the Compliance
According to the Explanatory Memorandum the seven members of the
Compliance Committee are representatives of domestic, regional and
international airlines, Airservices Australia and Sydney Airport
Corporation Limited. In addition, it states that members of the Committee
are nominated by their respective organisations although as a matter of law
these nominees are appointed to the Committee by the Minister (or
under proposed item 44, the Minister s delegate)
under existing subsection 66(3).
Items 43 and 45 are savings
provisions. Their effect is that delegations in force under section
70 made prior to commencement of the Bill and evidentiary
certificates made under section 71 prior to commencement would
continue to have effect.
Item 46 amends paragraph 74(2)(b). It would
allow the regulations to prescribe penalties of up to 50 penalty
units for offences against the regulations. The current limit is 10 penalty
units. In the second reading speech the Minister outlined his
commitment to producing regulations to penalise both no-slot and
off-slot gate movements. A regulation to enable the Slot Manager to
require operators to provide information and impose penalties for
failure to comply is proposed. However the regulation had not been publicly
released at the time of preparing this bills digest. The increased
amounts in item 46 relate to that proposed regulation.
Schedule 1 of the Act contains definitions relevant to the Act.
Items 47 54 make amendments to these definitions
to reflect the changes proposed in the Bill. For example
item 51 inserts a new definition of gate movement
to reflect that a gate movement is the first movement of an
aircraft in preparation for an aircraft movement that is a take-off
and the last movement after a landing when the aircraft comes to a
standstill and the engines are turned off. This new definition is related to the
numerous amendments that replace aircraft movement with the concept
of a gate movement .
Items 52 and 54 would remove
the definitions of land and take off. This is consequential to the
fact that the Compliance Scheme would no longer define when an
aircraft takes off or lands.
The 2007 ANAO audit highlighted the need for some improvement in
administration of the slot management scheme at Sydney Airport. It
the SADM Act requires Airservices Australia to
monitor and report breaches of the movement limit to the Parliament
through its Minister. However, reliable and accurate records do not
exist to evidence past monitoring of compliance with the movement
limit, and support the reports made to the Parliament. The
available data indicates that some of the 61 reported breaches may
not, in fact, have occurred. This data also indicates that there
may have been many other, unreported, breaches of the movement
The possibility that these Ministerial reports made to
Parliament may have been inaccurate is a matter of serious concern.
Whilst this Bill and the previously mentioned proposed regulations
should improve the scheme s compliance framework, it would useful
if the Government provided more information on the specifics on how
it will ensure the accuracy of all future reporting.
Accessed on 24 April 2008
This section of the Digest draws heavily on the ANAO report.
advised ANAO in February 2007 that the Slot Management Scheme and
the Compliance scheme are premised on definitions of take off and
land consistent with worldwide practice. ibid., p. 22.
Minister for Infrastructure, Transport, Regional Development and
Mary Anne Neilsen
6 May 2008
Bills Digest Service
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