5.1
Skills shortages and workforce retention are key problems facing the aviation sector. The sector is experiencing acute staff shortages, with skilled workers having left to find more secure work. The pandemic has also exacerbated pre‑existing problems in the aviation sector, including outsourcing in crucial safety and regulatory roles.
5.2
In response to the COVID-19 crisis, the Australian Government introduced a range of support measures designed to maintain aviation workforce capability. This included:
the Retaining Domestic Airline Capability (RDAC) program;
the Aviation Services Accreditation Support (ASAS) program;
the International Aviation Support (IAS) program; and
the Tourism Aviation Network Support (TANS) program.
5.3
Inquiry participants largely welcomed this assistance. However, several highlighted poor program design, insufficient support, and concerns about eligibility criteria. Throughout the inquiry, the committee received a number of recommendations aimed at improving job security, supporting attraction and retention of employees, and safeguarding the future of the aviation workforce.
5.4
The International Transport Workers’ Federation (ITF) noted in their submission to the inquiry that relative to international standards, the quantum of support provided by the Australian Government is “modest”, ranking at 18th out of 28 OECD countries as of August 2020.
5.5
This chapter is focussed on the adequacy of Australian Government support and initiatives in maintaining Australia's aviation workforce. After presenting evidence on these payments and programs, the chapter considers proposals for future measures, concluding with the committee's view and recommendations.
Australian Government support and initiatives
JobKeeper payment scheme
5.6
The JobKeeper scheme concluded on 28 March 2021. Prior to this, the committee received extensive evidence in favour of extending JobKeeper to preserve aviation capacity, foster consumer confidence and sustain aviation workers. The committee discussed this evidence in its interim report and recommended the continuation of the payment.
5.7
Since the interim report, inquiry participants have criticised the decision to end JobKeeper and maintained that there is a continuing need for support in the form of a wage subsidy. For instance, Mr Ken Dougherty from the New South Wales (NSW) and ACT Branch of the Australian Services Union (ASU), spoke to his experience as ground handler. He advised that, without support, many workers 'have had to resign, as there have been no redundancies and there don't look to be any in the future for the ground handlers, and they just can't survive with no income'.
5.8
Ms Margy Osmond, Chief Executive Officer (CEO) of the Tourism and Transport Forum, explained that, 2021 is 'much worse' than 2020 because 'we no longer have JobKeeper to support the industry, which has been a critical prop to the industry'. Ms Osmond argued that the sector 'has most definitely not moved on, and, for our industry, [the need for support] is both appropriate and urgent'. She repeated calls for JobKeeper to be extended to the wider sector.
5.9
Mr Tom Manwaring, Chair of the Australian Federation of Travel Agents, highlighted the impacts of the withdrawal of JobKeeper on the travel sector. He explained that 'without the ongoing support and without confidence returning and definitive open borders, international and domestic, we will lose a lot of people'. The solution, he argued, was payroll support.
Retaining Domestic Airline Capability (RDAC) program
5.10
The RDAC program provided funding to eligible airlines to maintain domestic airline capabilities. Airlines could use the funds for eligible costs which, depending on operational needs, may include replacing wages ($750 per week per eligible employee), aircraft storage costs and other plant and machinery maintenance, and training, licensing and accreditation costs necessary to maintain key staff and equipment in a flight-ready state.
5.11
When it appeared before the committee for a second time in March 2022, the Department of Infrastructure, Transport, Regional Development and Communications (the Department, Department of Infrastructure) was asked to provide metrics around the program; specifically to demonstrate how the committee could 'have confidence that taxpayer money has been well spent'. First Assistant Secretary of Domestic Aviation and Reform, Ms Janet Quigley, said the program has supported 'more than 13 000 workers … ensuring that they could maintain their connection with their organisation'. The RDAC was paid to Qantas, Virgin, Rex, Link Airways and King Island Airlines, which used the funding to 'support training' and supplement income, as well as for things like 'aircraft maintenance, so that they were flight ready'.
Funding conditions
5.12
Inquiry participants raised a number of concerns regarding the RDAC program. In particular, the committee heard that, in the absence of appropriate funding conditions, 'the money goes to the employer to do whatever they like with'. Ms Emeline Gaske, from the ASU highlighted the lack of clarity on 'how much of that money they need to pass on to the workers and under what circumstances'.
5.13
Qantas said the program provided 'a lifeline' for people affected by standdowns, and enabled 'Qantas to keep in contact with those people and provide training'. Group Executive of Corporate Affairs, Mr Andrew McGinnes, said:
That's been happening, and there's been a lot of training, whether it's cabin crew, engineering or pilots, to keep their skills up to speed. What I would also say is that a lot of the minimum networks that we were running, both internationally and domestically, also had that benefit because people were still on the job. It kept the aircraft moving, it kept people flying, it kept people current. That was really important as well.
5.14
In response to these concerns, Ms Diane Brown, Acting Deputy Secretary of the Department of Infrastructure, stated that the programs 'are about retaining capability. It's a matter for airlines how they retain capability'.
Exclusion of ground handlers
5.15
Participants remarked with concern that only airline employees were eligible for support under the RDAC. Mr Stuart Richardson from the Australian Aviation Ground Handers Industry Alliance (AAGHIA) noted that of the 9800 aviation workers employed as specialist aviation ground handler workers, all had been excluded from this funding, and up to 4000 were receiving no funding at all.
5.16
Ms Gaske was 'gravely concerned' by the exclusion of thousands of aviation workers not employed by airlines, saying:
If we do want to genuinely retain a domestic airline capacity, we have to support the critical workforces that will deliver that airline capacity going forward, and that includes ground handlers. The fact that they have been excluded from this scheme is just another kick in the guts for those workers.
5.17
Participants highlighted a number of unintended consequences that flowed from the decision to exclude ground handlers from the RDAC, including the loss of skilled workers who have left the sector in search of more secure work.
5.18
Spokesperson for the AAGHIA, Ms Ann Marie Jackson said, '[w]ithout aviation ground operations workers, planes cannot fly'. According to the AAGHIA, it would take six months to recruit, train and accredit new staff before ground operations can resume, at an estimated cost of $15 000 per person. Ms Jackson explained:
For safety reasons, we wouldn't expect just to employ new staff off the street and have them in front of aircraft within a four- to six-week period. There's a lot of training and a lot of compliance. For safety, we just wouldn't do that.
5.19
The committee heard that this labour shortage had the potential to artificially cap the number of flights that could occur, despite increasing consumer demand for air travel. Ms Jackson contended 'the likelihood of aircraft being grounded because we simply don't have the staff is very real'.
5.20
Ms Quigley emphasised that the 'RDAC is essentially about maintaining a domestic aviation capability' and, on that basis, 'it was determined that it was about the airlines' direct frontline employees'. It is unclear to the committee why outsourced ground handlers, performing the same work as ground handlers who are employed directly by airlines, were not considered to be ‘frontline employees.’
5.21
Ms Quigley added that the programs were designed to get 'airlines ready to pivot and ramp up as soon as those border closures and hotspots can be eased', which the Department assumes would 'flow through the ecosystem of the sector'.
5.22
The committee pressed the Department of Infrastructure on why these workers were excluded from the RDAC program. Ms Brown acknowledged it was 'true that, where the ground support staff are not directly employed by airlines, they are not receiving the same support as the airlines'; but said this 'was a decision of the government', and she was 'not aware exactly of all the facts that they considered'.
5.23
In addition to the RDAC, the committee heard that none of the funding from the Domestic Aviation Network Support (DANS) and Regional Airline Network Support (RANS) reached aviation ground handling providers or workers. Many thousands of ground handers were also excluded from JobKeeper due to the Australian Government's decision to exclude casual workers, or in the case of dnata, the exclusion of companies owned by foreign states.
Lack of consultation
5.24
The committee heard that, as part of the development of the RDAC, the Department of Infrastructure consulted the major airlines—Qantas, Virgin and Rex. However, unions were not consulted.
5.25
Ms Gaske argued that there were 'flaws in the package' that were 'clearly the consequence of [the Department] not having spoken with the frontline workers'. For example, a failure to coordinate policies: in particular, 'a lack of cohesion with the COVID disaster relief payments'. Ms Gaske explained that there is a risk workers will not get paid under either the COVID-19 disaster relief payment or the RDAC scheme:
Simply because of the timing differences and the way in which an airline might stand you down on a particular day—which doesn't align with the seven days set by Centrelink to be the relevant time in which you have to have lost 20 hours—workers will lose out on money even though they're being stood down for two weeks at a time and losing two full weeks of work.
5.26
Ms Gaske also noted that, despite seeking to provide input on multiple occasions, the ASU was only offered a meeting with the Department of Infrastructure after the program guidelines were finalised.
5.27
The Department of Infrastructure commented that it would 'continue to review' the programs in place, and 'support government in making any future decisions', based on 'the data'.
Aviation Services Accreditation Support (ASAS) program
5.28
On 29 March 2021, the Australian Government commenced a new ASAS program to 'help ground-handling companies meet the costs of mandatory training, certification and accreditation to ensure they maintain their workforces so they can stand them back up when the market expands again'.
5.29
The program ran over nine months from 29 March 2021 to 30 December 2021. According to the Department of Infrastructure, its aim was to support training and accreditation for about 5000 employees, or around 30 per cent of the pre‑COVID workforce. During the Department's March 2022 appearance, Ms Quigley said the program, which closed on 31 December 20 'was able to support training certification and accreditation for around 70 per cent of the total workforce'.
5.30
Ms Quigley explained that the ASAS was a grants program designed to provide $52 million in 'relief directly to ground handling providers' for the purposes of training and certifying new and existing workers:
It covers the costs of training of staff that require accreditation and skills to be maintained and to be current for them to be able to return as the aviation sector activity increases.
Failure to coordinate policies
5.31
Inquiry participants raised concern that, without corresponding support to retain skilled workers, the ASAS program was of little use. National Secretary of the Transport Workers' Union (TWU), Mr Michael Kaine, criticised what he called the Australian Government's 'blinkered set of policies'. He explained that because ground handling companies were not able to access the RDAC program—which would have assisted them in retaining workers—they 'are now having to let workers go and let those skills go with them'. Mr Kaine said, 'if you don't have the capacity to keep them on the books then that training is no good for you at all'.
5.32
Likewise, Ms Jackson said being able to provide ground handlers 'with $750 or some portion of payment to keep food on the table', would have enabled businesses to keep workers 'connected', and 'stop them from having to go and look for work in other industries'. This would have meant the industry would not 'have this really long pathway' for training and accreditation of new workers.
5.33
The Department of Infrastructure was asked to respond to concerns from the AAGHIA and others about the failure to coordinate the provision of ongoing wage subsidy support with the training and accreditation assistance. Ms Brown said the Department was 'interested in maintaining the capability of ground support workers', and that was why it extended the ASAS. However, the question of 'whether [ground services workers] need additional support similar to that provided in RDAC' was 'a further question' that the Department was still 'considering', before providing any advice to government.
5.34
Representatives from the Department of Infrastructure were asked if the AAGHIA had specifically raised this issue with the Department during consultations or communications. Ms Brown said the AAGHIA had not specifically brought up this issue with the Department, but had 'raised concerns about maintaining capability'.
5.35
On notice, the Department of Infrastructure confirmed that the AAGHIA had raised this concern more than once, writing to the Deputy Prime Minister and Minister for Infrastructure, Transport and Regional Development 'on a number of occasions throughout the pandemic'.
International Aviation Support (IAS) program
5.36
The International Aviation Support (IAS) is providing funding to Australia's two international airlines—Qantas and Virgin Australia—'to maintain a core international aviation workforce and operation capability'. Eligible costs include staffing ($500 per week per eligible employee) and aviation training, skills and certification, as well as aircraft storage and maintenance costs.
5.37
The initial grant agreements cover the period from 1 April to 31 October 2021 and provide for total funding of up to $200 million. However, the Australian Government agreed to extend the grant agreements from 1 November 2021 to 31 March 2022 with an additional funding commitment of up to $119.65 million.
5.38
While the payment was open to Qantas and Virgin, Mr Kaine argued that the IAS 'substantively supported only Qantas, because only Qantas is presently undertaking—or will undertake upon reopening—international operations'.
Funding conditions
5.39
Of particular concern was the discretion granted to airlines in the use of funding allocated under the IAS. The committee heard that 'the amount of funding that [airlines] provide to their staff is ultimately a matter for the airline schemes that they establish'. Indeed, representatives from the Department of Infrastructure confirmed that the program guidelines do not 'mandate … how much airlines actually pay to their staff'.
5.40
However, Ms Brown pointed out that there are program guidelines which set out eligible uses for IAS funding.
5.41
Mr Richard Wood, First Assistant Secretary, International Aviation, Technology and Services at the Department of Infrastructure, explained that:
The way the international aviation support program is structured is that we provide funding to Australian international passenger airlines for the retention of aviation capability. They determine how that funding is provided—so, the specific support arrangements for their employees. Airlines, of course, report on that so we can equip funding, but the amount of funding that they provide to their staff is ultimately a matter for the airline schemes that they establish. We do not mandate, in the international aviation support package, how much airlines actually pay to their staff.
5.42
While the airlines were able to determine how they used the funding, the program did mandate that airlines 'maintain a minimum capability … including keeping a minimum number of staff connected'. Mr Wood explained that Qantas was required to keep 'between 6000 and 7500 people', and Virgin was required to keep '1100 people'.
5.43
Ms Brown advised that funding recipients are subject to reporting on a regular basis—sometimes as often as weekly—to ensure that funds are being used only in accordance with the program guidelines. In addition, each airline required to provide monthly assurances it is maintaining the agreed level of international capability.
Employee payment amount
5.44
Concerns were raised that the payment of $500 per week per eligible employee was not sufficient. For Ms Jayne Lacey, a front-line aviation worker, 'it still was not enough for us to survive on'. She, along with Ms Gaske, called for the IAS payments to be permanently increased to $750 per week, following a temporary increase in September 2021, 'so people can survive, because we need our jobs retained'.
5.45
Furthermore, the committee heard that the discrepancy created angst amongst aviation workers about who was eligible to get which payment—IAS or RDAC—and why one group was getting more than the other.
Exclusion of former pilots
5.46
While the IAS program was largely welcomed by the Australian Federation of Air Pilots (AFAP), Federation President, Captain Louise Pole, pointed out that this assistance only captured international pilots that remained employed. She explained that there were 'hundreds of international pilots' who got made redundant early on in the pandemic, most of whom had 'lost connection with the industry'. Captain Pole was concerned that 'existing programs don't address the need for the many unemployed Australian pilots to regain and retain their skills and qualifications—skills which will be required when aviation service provision ramps back up'.
Tourism Aviation Network Support (TANS) program
5.47
In addition to programs that provided direct support to the aviation sector, the Australian Government initiated the Tourism Aviation Network Support (TANS) program. The TANS program opened on 26 March 2021 and provided a 50 per cent reduction on 800 000 economy tickets to and from 13 eligible locations. Under the program, discount tickets had to be booked between 1 April and 30 November 2021, for travel by 30 November 2021. This was later extended to 28 February 2022.
5.48
The program was designed to help retain capacity in domestic aviation and tourism by stimulating sector demand—particularly in regional areas:
Australia's airlines, hotels and caravan parks, restaurants and bars, travel agents and tourism operators are set for a rush of hundreds of thousands of tourists as part of a new $1.2 billion support package from the Morrison Government. … The Prime Minister said the package's mix of half-price airline tickets, cheap loans for businesses and direct support to keep planes in the air, and airline workers in their jobs, would be a bridge to a more normal way of life for Australians.
5.49
Another key goal of the program was to incentivise travel to key domestic tourism areas. The Prime Minister said:
This is our ticket to recovery—800,000 half-price airfares to get Australians travelling and supporting tourism operators, businesses, travel agents and airlines who continue to do it tough through COVID-19, while our international borders remain closed.
5.50
However, the committee heard in September 2021 that uptake had been affected by domestic travel restrictions. Ms Quigley noted that, despite 'significant uptake in the beginning of the program … travel has slowed', as a result of 'limited movement and restrictions across states'.
5.51
On notice, the Department revealed that airlines estimated 'around 800 241 TANS tickets had been sold as of 20 June 2021'. However, the total dropped to 'approximately 623 618' tickets by 29 August 2021, due to cancellations.
5.52
It remains unclear to the committee and the general public how the destinations within the TANS programs were selected, other than that many destinations coincidentally were located within marginal federal electorates. It also remains unclear why additional destinations were unexpectedly tacked onto the TANS program just days after the initial announcement. Austrade, the agency responsible for advising the Australian Government on the choice of destinations, has declined to release its data and analysis informing the Government’s decision.
5.53
During its March 2022 appearance, the Department was unable to provide any estimates as to what the reopening of the international border may mean for tourism-associated aviation, including to regional areas. However, Ms Quigley said that the Department is working closely with Austrade on a tourism promotion program called THRIVE 2030, 'trying to reignite interest in coming back into Australia'.
Proposals for future measures
5.54
As discussed in the committee's interim report, and in Chapter 3, the COVID‑19 pandemic has, and continues to, alter the aviation employment landscape.
5.55
Inquiry participants widely agreed that, while short-term initiatives such as the ASAS, IAS and RDAC programs have gone some way to preserving workforce capability, ongoing support for the aviation workforce is essential for a strong and sustainable recovery. Inquiry participants identified further actions that they believed should be prioritised to meet the current and future needs of the sector. These proposals are discussed below.
Strategic workforce planning
5.56
The committee received strong evidence of the need for an industry‑wide approach to aviation workforce planning and development, supported by streamlined policy and regulation.
5.57
Inquiry participants called for greater investment in the aviation workforce, both current and future, though public and private funding mechanisms. The Australian and International Pilots Association (AIPA) noted that, while industry 'needs to step up even more in developing their airline training programs', it will take years to train and develop pilots. For this reason, long‑term workforce planning is needed.
5.58
Mr McGinnes said Qantas has 'restarted' its engineering apprentice program, and that around 91 pilots have graduated from the Qantas pilot academy 'thus far of 127 that are coming through'. He said he hopes to 'see more' of these positive developments in future.
5.59
The AIPA noted that Australia's national aviation policy 'appears to lack the most critical element—a strategic approach', and there is a need to better plan for an increase in demand for key aviation personnel.
5.60
The Government's 'five-year plan for aviation', the Aviation Recovery Framework, was released in December 2021 and is discussed in the final chapter of this report, Chapter 6.
Make further funding support conditional
5.61
A number of inquiry participants, such as the AIPA, called on the Australian Government to better target current and future support measures to ensure that aviation workers benefit directly. The committee received strong evidence that, in some cases, employers in receipt of government funding, such as Qantas, have sought 'to maximise cash flow and fee-syphoning rather than maximising efficient training and capacity maintenance'.
5.62
Inquiry participants were critical, for example, of the fact that millions in government assistance had been provided to Qantas, which then, on 30 November 2020, chose to outsource around 2000 jobs. Outsourced worker, Mr Brett Langford, said:
Qantas is all about saving money. First off, they were the largest recipient of JobKeeper. You remember that—the no-strings-attached handout that kept workers connected with their employer. And how did that work out for them again? I'm not quite sure. On top of that, the government, time after time, has handed millions in no-strings-attached money to Qantas to keep it afloat.
5.63
In response, Mr Kaine argued in favour of attaching strict conditions to government support, saying:
… we need strict conditions to apply to government funding to make sure that the funding is used for the intended purpose so that we don't have a situation where a company like Qantas can take hundreds of millions of dollars worth so that we don't have a situation where a company like Qantas can take hundreds of millions of dollars worth of JobKeeper, designed to keep workers connected with their task, and then illegally outsource thousands of them as a kind of community reward. That's outrageous.
5.64
The AIPA argued that, despite evidence of misuse, there seems to be 'a disingenuous presumption in government that the aircraft operators have some higher purpose beyond maximising profit'.
5.65
Despite being asked repeatedly, the Department of Infrastructure did not confirm whether advice had been given to, or sought by, the Australian Government in relation to the choice by Qantas to outsource its ground handling operations. Specifically, the Department did not confirm if there had been any advice on potential impacts of Qantas' actions on programs designed to provide funds intended to retain aviation capacity. Ms Brown advised that '[i]ndustrial relations matters would be considered, probably, by a different department'.
5.66
In March 2022, the Department of Infrastructure confirmed that Qantas had received just over $684 million in financial support from the Commonwealth during the pandemic, as at 31 January 2022. This breaks down as:
$145.7 million under the DANS program;
$103.7 million under the IAS program;
$5.6 million for 'facilitated repatriation flights';
$34.1 million under the RANS package;
$132.9 million under the airline relief package, of which $112 million is domestic aviation security charges and $21 million is 'the waiver of fuel excise';
$3.8 million under the domestic aviation support costs package (DASC);
$171.9 million in international aviation support;
$47.1 million for the TANS program; and
$39.2 million under the RDAC program.
5.67
This figure does not include the $856 million in JobKeeper payments claimed by Qantas over the course of 2020 and 2021, making Qantas 'by far the biggest JobKeeper recipient'.
5.68
Qantas maintained that the substantial level of support it received 'reflected' the fact that Qantas is 'probably the company most impacted by COVID in this country'. Mr McGinnes said the support gave Qantas employees 'basic income support' when there was no work for them, and 'made sure that we were ready to get back in the sky when borders finally opened'. He added that 'much of the funding' Qantas received 'was actually fee for service', rather than 'support':
By that I mean the flying we did to maintain basic connections between regional cities and towns, to keep Australia's exports moving, to take aid to our neighbours, and, importantly, to fly Australians home from overseas as part of a repatriation mission.
5.69
Mr Kaine argued that handing out this assistance 'no strings attached' was a failure of leadership on the part of government:
The market was destroyed during COVID. What we needed was leadership. We needed a government that would step in. The government put in place the JobKeeper system, which was untied to any requirement. We had a situation where the largest recipient of JobKeeper payments, which was Qantas, received those payments and then, while receiving them, slashed and burned its workforce. We have a CEO who, when times are good, will tell governments to get their hands off the market; to leave us alone and let the profits come as they may. This resulted in a 2018–19 pay packet in total of around $24 million for that CEO. And when times get tough, as we saw back in 2014, we see the same CEO marching the corridors of Canberra with the cap out asking for financial assistance from governments.
What COVID has shown us, and the reason COVID is so important in exposing these issues in aviation, is you cannot leave aviation to the market. It is an essential service. It needs stabilisers. Governments right around the world have understood this, and many have intervened during COVID and put in place medium- to long-term supports for aviation. Our government is nowhere to be seen.
Airport sector skills package
5.70
The Australian Airports Association (AAA) highlighted the shortage of skilled airport personnel, such as aerodrome reporting officers, work safety officers, airfield technical inspectors and security screeners.
5.71
AAA argued that efforts to address aviation skills shortages have been primarily focussed on the commercial and general aviation subsectors. However, significant redundancies and standdowns at Australian airports during the pandemic represented a sizable loss of competency, skills and experience in airport operations and, once recovery is underway, there will be a need to bring these disengaged personnel back into the airport sector workforce.
5.72
To this end, AAA sought 5.4 million over four years to develop a targeted airport sector skills package ($3 million), and gain accreditation as a Registered Training Organisation ($2.4 million). It argued that this would ensure qualified airport personnel can return to the industry, as well as attracting and retaining new entrants to a range of airport career pathways.
Targeted training solutions
5.73
In August 2020, the Department of Infrastructure reported that it expected aviation growth to translate to pressure on training systems to meet the huge demand for skilled personnel. The committee heard strong support for the establishment of targeted training solutions to address this demand, as well as support for increased industry engagement to develop a more coherent training policy.
5.74
The Expert Panel made a number of recommendations relating to the need to review, streamline and align regulatory pathways and frameworks. Similarly, the AIPA called for standardised training courses for a number of qualifications, and argued that 'the adoption of regulator provided training courses would be a great boon to standardisation for both the industry and the regulator', and would 'underpin the longer term quality of aviation training'.
5.75
During its March 2022 appearance before the committee, the Department said discussions with the sector have suggested 'pilots and engineers [are] the key two areas where they're thinking that there will be future constraints'. Ms Quigley was asked if 'any particular proposal [had] been put forward' to address this shortage. She replied that information about shortages is still largely 'anecdotal' at this stage so the Department is 'watching' the issue 'closely'.
5.76
The Department said its Aviation Recovery Framework includes a focus on making flight instruction more accessible, by having CASA 'explore mechanisms to ensure that flight instruction and related services are more widely, readily and efficiently available'.
5.77
Assistant Secretary, Domestic Policy and Programs, Mr Jason Dymowski added that the Department is now 'looking at the settings that are in place around flight training'. While it believes the larger airlines have flight training academies in place to cover their own needs, the Department recognises:
… something that we need to look at is what has been the impact of COVID and what that looks like in terms of supporting the next level of growth or the next expansion back in the aviation market. That's definitely something on our radar.
Job Ready Pilot Program
5.78
AFAP argued that that the pandemic presents an opportunity to reshape the aviation sector, particularly in relation to workforce planning and regulatory reforms, rather than 'to simply re-adopt the pre-existing fragility for the aviation sector'.
5.79
In particular, AFAP identified a need for a stakeholder currency and proficiency program for pilots, which could retain and return eligible pilots to a 'job-ready' status. It argued that a Job Ready Pilot Program would address the economic imbalance in training costs for pilots. AFAP also called for a training levy on airline operators to incentivise employers to contribute to the cost of training pilots.
5.80
AIPA submitted that:
For highly qualified licenced personnel, the gaining of essential knowledge and experience creates a lead time for supply that will substantially lag the demand if we are forced to respond to a whole cadre of those personnel being permanently lost to the industry. Even for those who can return, their skills are highly perishable and refresher training requirements may well exceed the capacity of training systems to return them to job-ready status.
5.81
Figure 5.1 below provides further detail on the proposed Job Ready Pilot Program.
5.82
In a supplementary submission made to update the committee in February 2022, AFAP said the changed circumstances of the recovering aviation sector 'support the need for a funded Job Ready Pilot (JRP) program' and that 'Australia needs to act expeditiously to retain Australian pilots for Australian flying roles'.
5.83
AFAP also provided evidence that airlines in the United States are now 'targeting Australian pilots' proactively, seeking to employ around 1000 Australian pilots. AFAP suggested that:
… an Australian pilot qualified and employed to fly in a USA airline would remain lost to the Australian system for some time (likely years). … Thus, we suggest that a proactive and funded recurrency of the cohort of Australian pilots not currently employed by an Australian operator will greatly help to ensure they return and remain as a ready employment resource in Australia, for the betterment of the Australian community and economy.
Territory Aviation Skills Centre
5.84
Mr Rohan Badenhop from the NT Chamber of Commerce, observed that, while there has been a 43 per cent decrease in 'interstate movements', and a 21 per cent decrease in 'NT regional movements', there has 'actually been a three per cent increase' in general aviation from 2019 to 2021 in the NT:
As the larger aircraft have slowed down—we've had—the general aviation has stepped up and had a three per cent increase. This, of course, is just reflecting the importance of aviation to the regions. You can't have emergency evacuations, you can't have people being able to be represent certain communities, you can't have people being able to fly in essential goods and services to places, particularly over the wet season that are cut off, if you don't have aviation.
5.85
Mr Badenhop said the Chamber of Commerce is 'afraid' that the major airlines will end up 'siphoning out engineers', and regional airlines and those in general aviation 'won't be able to operate purely on the basis of lack of workers':
That basically is the priority of the Territory Aviation Skills Centre, which has a two-part reasoning for existence. One is for ensuring that we have the workforce skills coming through into the aviation sector that needs it. The other side of it is it's ensuring that students have a year 12 through to a career pathway.
5.86
Ms Debbie Paylor, from the Industry Skills Advisory Council Northern Territory, argued that the pandemic is set to 'compound' the industry's pre‑existing workforce shortages 'exponentially'. To address this 'significant' demand on the workforce, the Northern Territory has piloted 'an aviation academy', establishing the Territory Aviation Skills Centre.
5.87
Ms Paylor said the pandemic has' accelerated the focus and need for training to be more localised in rural and regional areas'. The Aviation Skills Centre in the Territory has received willing support from industry, showing that 'this model of independent brokering and industry led collaboration is achieving real outcomes'.
5.88
The Aviation Skills Centre is 'a trunk station', created to service a need and demand for training from the Alice Springs aircraft storage facility, and engaging 'multiple sectors'.
5.89
The Centre delivers a Certificate II in aviation and line maintenance, through registered training organisations. This training was previously only available in Cairns, 'so Territory businesses would send their students interstate for blocks of training and for assessment, which is quite costly and prohibitive to industry'.
5.90
Ms Paylor urged the Government to provide ongoing 'support and commitment', through 'apprenticeships and traineeships', and 'infrastructure development', in order to ensure the Aviation Skills Centre can play a role in developing 'a much-needed workforce … in rural and regional northern Australia'.
Committee view
Program design and consultation
5.91
Government supports provided to the aviation sector during the COVID-19 crisis have been significant. Without these supports, most, if not all airlines operating in Australia, would have struggled to survive.
5.92
In its interim report, the committee recommended the continuation of JobKeeper—or a wage subsidy 'modelled off JobKeeper'—to support aviation workers, whose jobs are essential to our economy and society. The Government did not continue to provide JobKeeper; not even for aviation and tourism workers, whose jobs continued to be directly impacted by government policies, including border closures and lockdowns.
5.93
The measures put in place instead—while welcomed by the major carriers—left some parts of the aviation sector, and many individual aviation workers, without support. Thousands simply left the industry, broken and traumatised by their experiences.
5.94
The committee has heard a wide variety of evidence from stakeholders in the sector who felt excluded from support. The intentional exclusion of many ground handling workers from the RDAC program is particularly disappointing, given many of these workers had only recently been Qantas employees and eligible for support.
5.95
Once again, this issue was raised at length by submitters and witnesses during the earlier part of this inquiry, and the committee made a recommendation in its interim report that any wage subsidies or other support programs for the aviation industry be provided to all Australian workers who pay tax, regardless of whether the company is a foreign sovereign-owned entity.
5.96
The committee is disappointed that this recommendation was not implemented; the result being that many hard-working Australian ground handlers missed out on assistance, and many had to leave the sector.
5.97
The committee also notes concerns raised by inquiry participants from across the aviation industry about the lack of consultation on these initiatives. It is not enough to consult with airlines alone—the aviation sector needs all of its parts to function. Consultation must be wider and deeper, and not treated as an afterthought.
5.98
The committee recommends that the Australian Government consults and communicates closely with industry, professional associations and trade unions in the design and delivery of future aviation support measures.
5.99
The committee notes that the Australian National Audit Office is presently conducting a performance audit of COVID-19 support to the aviation sector. The audit, which is due to be finalised in June 2022, will assess whether the suite of measures was designed and implemented effectively by the Department of Infrastructure, Transport, Regional Development and Communications in response to the COVID-19 pandemic.
5.100
The committee urges the Australian Government and the Department of Infrastructure, Transport, Regional Development and Communications to closely monitor this audit and its outcomes, and use its findings to improve the design of future aviation support measures, and design, consultation and implementation processes.
Conditional assistance
5.101
The committee notes the evidence that program design has led to ineffective and sometimes unfair outcomes. Of particular concern is that Qantas has received almost $2 billion in government assistance over the course of the pandemic—much of it specifically targeted towards retaining workers and capacity—with very limited conditions applied to require the company to pass along the benefit to its employees or protect their jobs.
5.102
At the same time as being 'by far' the biggest recipient of JobKeeper, the company illegally outsourced thousands of jobs. The cost to Australian taxpayers of supporting Qantas has not generated a return by way of equities or future repayments of the support.
5.103
The committee supports calls for government assistance provided to the aviation sector in Australia to be conditional; funding should help support workers to stay connected to the industry and should retain skills and capacity within the sector.
5.104
The committee recommends that any future crisis support provided by the Australian Government to the aviation sector be conditional upon recipient entities retaining skills and capacity in the sector. Initiatives designed to retain capacity should specify that workers must be retained, that their pay and conditions should not be reduced, and should set out the amount that workers should be paid under the assistance.
5.105
The committee also recognises that a functioning and effective aviation industry is essential for Australia’s national security, supply chain continuity and keeping regional Australia connected with major population centres.
5.106
The importance of Qantas as Australia’s national carrier is enshrined by the requirement in the Qantas Sale Act that the company must remain majority Australian-owned. When Qantas outsources its entire ground handling operations to foreign-owned companies, it is circumventing the intention of the Qantas Sale Act and is acting contrary to the national interest.
5.107
The Australian Government should consider taking an equity stake in major recipients of future crisis funding to ensure the intention of the Qantas Sale Act is protected, that the crisis funding is responsibly spent, and that critical decisions about Australian aviation are not outsourced to the other side of the world.
5.108
To committee recommends that to assist with enforcing these conditions and expectations associated with future crisis support payments, and in recognition of aviation’s critical contribution to national security, supply chains and sovereignty, that the Australian Government considers acquiring an equity stake in support recipients as part of the support agreement.
Future workforce supply
5.109
Australia is experiencing a severe shortage of aviation workers and the situation is growing worse. The current shortage of qualified pilots and aircraft maintenance engineers is a global problem and a major issue for Australia's aviation system. Of particular concern is the finding of the Future of Aviation Reference Panel that Australia has little to no workforce pipeline and no new early career entrants. Urgent action is required.
5.110
Australia faced an aviation skills shortage even before COVID-19 hit. However, the COVID-19 situation has further decimated Australia's aviation workforce. Due to the downturn in aviation activity airlines have made drastic cuts to workforces, skills and accreditation have lapsed, and many workers have left the aviation sector in search of more secure employment. In addition, some airlines have relied heavily on early retirements to reduce costs, which has further decreased supply.
5.111
The committee believes one approach to providing the training capacity to rebuild national aviation skills and career paths, would be to establish a Job Ready Pilots Program, as suggested the AFAP.
5.112
The committee notes that the 2018 Expert Panel Report on Aviation Skills and Training identified a range of opportunities to improve the effectiveness of the aviation training framework. Some recommendations have been addressed by Government, such as through the Women in Aviation Initiative designed to attract more female participation and representation in the sector, and an increase to the limit on student loans. Further work can still be done in these areas within the sector, including on options to develop career pathways that offer greater employment opportunities.
5.113
The following recommendations are designed to support the retention of existing skilled aviation workers through the current period of upturn, while ensuring a pipeline of new talent into industry.
5.114
The committee recommends that the Australian Government provides ongoing and targeted assistance to support the retention, training, certification and recertification of aviation workers throughout the recovery period.
5.115
The committee recommends that the Australian Government, in consultation with unions, professional associations, airlines, labour hire companies and training providers:
identifies the long-term training needs for the aviation sector;
examines where future pressures lie;
develops a program of skills development targeted at the aviation sector; and
develops initiatives to ensure the industry remains internationally competitive in retaining key staff and attracting new entrants to the workforce.
5.116
The committee recommends that the Australian Government urgently considers the skills needed across the sector, and the best means of retaining those skilled workers, including developing a scheme that provides financial support directly to pilots, engineers and other highly skilled, in-demand aviation professionals to assist in maintaining their accreditation and training requirements.