Submission by NZ Airports Association on the CAA Consultation Document "Safety Regulation of Aviation" 28 May 2013 - 8 July 2013
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Submission by NZ Airports Association on the
CAA Consultation Document
“Safety Regulation of Aviation” 28 May 2013
8 July 2013Table of Contents Introduction........................................................................................................................................ 3 Scope .................................................................................................................................................. 4 Current Status .................................................................................................................................... 5 The ‘Options’ ...................................................................................................................................... 5 Issues to be addressed with Option 4 ................................................................................................ 5 Imposition of cost ........................................................................................................................... 5 Clarity of regulatory intent ............................................................................................................. 6 Consistency of requirements.......................................................................................................... 7 CAA Role to advance safety through SMS ...................................................................................... 7 Response to Specific Questions ......................................................................................................... 8 Q1. Do you support adopting a mandatory risk management approach to aviation safety? ....... 8 Q2. Given that for many organisations meeting ICAO requirements will be important, are there any other options to improve aviation safety that should be assessed?....................................... 8 Q3. What do you think would be the implications for your organisation of moving towards a risk management approach, such as SMS? .................................................................................... 8 Q4. Have you considered the probability of your organisation being involved in an accident, and if that happened, what do you estimate the likely range of costs to your organisation would be? ..................................................................................................................................... 10 Q5. About how long might it take your organisation to implement a risk management approach, like SMS? ..................................................................................................................... 10 Q6. Do you see any difficulties with the proposed two group transition approach to adopting Rule amendments if a mandatory risk management approach is adopted (see Section 7 and footnote 14)? ................................................................................................................................ 10 Q7. Are there any examples of specific Rule amendments that could be adopted to allow for greater flexibility and innovation if a risk management approach were to be adopted? ........... 10
Introduction
1. This is the submission from the New Zealand Airports Association (“NZ Airports”) on the Civil
Aviation Authority’s (“CAA”) consultation document “Safety Regulation of Aviation” dated 28
May 2013. This consultation document considers a risk management approach to future
regulation of aviation safety and proposes a way forward (“the Proposal”). This submission is
made on behalf of the Association’s members1 and should be read in conjunction with separate
submissions that may be provided by individual airports.
2. NZ Airports will be pleased to provide any further information required in support of this
submission.
The contact person is:
Kevin Ward
Chief Executive
New Zealand Airports Association
PO Box 11 369
Manners Street
Wellington 6142
DDI: 04 384 3217
Mobile: 021 384 524
Email: kevin.ward@nzairports.co.nz
3. NZ Airports acknowledges the consultative approach being taken by CAA in promoting a risk
management approach to all aspects of the aviation sector.
4. In particular NZ Airports recognises and applauds the CAA’s leadership through early signals of
intention through CAA policy, the early adoption of an Advisory Circular to describe a means of
compliance through a Safety Management System (“SMS”), the initiatives within the CAA to
educate and embrace SMS internally, and the well-articulated strategy to encourage the
aviation industry to take a proactive voluntary approach which is independent of the
rulemaking process.
5. NZ Airports endorses New Zealand having a regulatory environment that is aligned with the
International Civil Aviation Organisation’s (“ICAO”) Annex Standards as far as practicable. NZ
Airports acknowledges that ICAO requires an SMS for the management of safety and risk within
organisations.
6. In NZ Airports view, the detail of implementation of SMS will be critical to its ultimate success in
achieving the intended further positive safety outcomes.
1
1 Ardmore Airport, Auckland International Airport, Christchurch International Airport, Dunedin International Airport,
Gisborne Airport, Hamilton Airport, Hawke’s Bay Airport, Invercargill Airport, Kapiti Coast Airport, Kaitaia Airport, Kerikeri
Airport, Ohakea Airport, Marlborough Airport, Masterton Airport, Motueka Airport, Nelson Airport, New Plymouth
Airport, Palmerston North Airport, Queenstown Airport, Rangiora Airport, Rotorua Airport, Takaka Airport, Taupo Airport,
Tauranga Airport, Te Anau Airport Manapouri, Timaru Airport, Wanaka Airport, Wanganui Airport, Wellington
International Airport, Westport Airport, Whakatane Airport, Whangarei Airport, Whenuapai Airport
NZ Airports Association Submission to Civil Aviation Authority July 2013 Page 37. Regulatory requirements for SMS have the potential for imposing cost on the aviation sector.
The detail of that regulation requires a balance between achieving safety assurance and
imposed costs. NZ Airports promotes safety at reasonable cost.
Executive Summary
8. NZ Airports supports option 4 “mandatory implementation of risk management systems“
subject to the regulatory detail addressing issues raised in this submission.
9. NZ Airports has embraced the direction of SMS and as an industry association is providing
support and advice for members, including establishing a project to provide an airport-oriented
template to assist smaller airports to introduce SMS.
10. Mandatory requirement of SMS has the potential to impose significant costs on the aviation
sector, notwithstanding the opportunity to derive benefits.
11. NZ Airports advocates for care in the detail and form of regulation, and the timing and
strategies for implementation, so that unreasonable cost is avoided and the safety benefits are
maximised through organisations embracing the necessary culture shift for SMS to work.
12. SMS regulation should align with other risk management legislation, and should enable
organisations to adopt integrated management of occupational health and safety and aviation
risk.
13. Smaller airports will face cost and resourcing hurdles to introduce SMS. In particular, changes
to CAR Part 139 may necessitate previously non-certificated airports to become certificated
with the consequential additional safety systems. NZ Airports submits that differing transition
periods should be contemplated for businesses facing specific implementation hurdles.
14. CAA should continue its leadership role in implementing SMS and has a critical on going role in
sharing information and sharing SMS systems so that costs are contained.
Scope
15. NZ Airports supports the principle of having the same SMS rule requirements applying across all
affected Civil Aviation rule Parts. The CAA intention to accommodate scalability in the
application of SMS (SMS is not a ‘one size fits all’ approach) is supported, however the means
by which the regulatory environment would accommodate and mandate that is unclear.
16. NZ Airports members span a wide range of scale of businesses, from Auckland Airport through
to small non-certificated unattended aerodromes. Some businesses will have capacity to
embrace a relatively sophisticated level of SMS, while smaller business may struggle with the
costs and resources to achieve the expected level of risk management assurance.
17. This submission therefore raises the possibility of variation in the way that the regulatory
environment is implemented for different airport types.
NZ Airports Association Submission to Civil Aviation Authority July 2013 Page 418. NZ Airports also highlights that our Association and this submission do not represent a number
of smaller non-certificated and unattended aerodromes, for whom the resources and initiatives
of the Association as discussed further in this submission will not necessarily be available.
Current Status
19. NZ Airports has embraced the direction of SMS as a desirable enhancement of aviation safety
independent of the regulatory environment.
20. The larger airports tend to agree that benefit opportunities can outweigh the cost of safety
initiatives and many airports are well advanced in their implementation of SMS.
21. NZ Airports is in the process of establishing a project that will provide an airport-oriented
template to assist smaller airports to introduce SMS and embrace appropriate scalability. This
sharing of knowledge, skills, and concepts will enhance the quality of SMS achieved across NZ
Airport member organisations. It also provides a potential opportunity for the development of
information sharing across airports as part of the SMS ‘culture’.
22. Most NZ Airports members see other health and safety aspects of the airport business as being
integrated with the aviation risk management through SMS.
23. We comment again on these issues below.
The ‘Options’
24. The consultation document identifies four options. NZ Airports supports option 4 “Mandatory
Implementation of risk management systems” subject to the regulatory detail addressing the
issues raised in this submission.
25. NZ Airports sees this option as the only realistic option that addresses on-going alignment with
ICAO standards.
26. This option also provides the best alignment with likely expectations of an airport’s customers,
partners and stakeholders.
27. Mandatory requirement of SMS has the potential to impose significant costs on the aviation
sector (and consequently aviation customers and the economy at large) and this aspect will be
critical to successful implementation of the option.
Issues to be addressed with Option 4
Imposition of cost
28. The form of the regulation that mandatorily requires SMS will determine the costs imposed by
SMS on the aviation sector.
29. The risk of costs being imposed will occur to varying degrees in the following areas:
Establishing SMS policy
Setting up risk management systems
Training
NZ Airports Association Submission to Civil Aviation Authority July 2013 Page 5 Change management
Risk identification
Reporting/recording
Audit
30. Many components of SMS are already being undertaken through quality management systems
and current practice. The above areas represent the potential for additional cost, which has not
been quantified.
31. Audit is a potential area for significant cost depending upon the approach taken by the
regulator. On a continuum this approach could range from ‘a checklist tick exercise’ at one end
to a ‘look, learn, and feel’’ at the other end. In some ways predictability of cost could come
from a checklist approach however the biggest safety benefits are likely to accrue from the
‘look and learn’ approach for which cost and uncertainty are likely to be higher.
32. Opportunities to incorporate independent audit assurance should be embraced in the
regulatory regime.
33. NZ Airports perceives that most of the concern and caution about regulation of SMS stems from
the risk of material cost increases, plus the fact that SMS is less tangible for measuring
compliance and somewhat of a ‘learning curve’ for both industry and the regulator.
34. NZ Airports therefore advocates that care be taken in the detail and form of regulation, and in
the timing and strategies for implementation, and that flexibility be an objective in developing
that detail.
Clarity of regulatory intent
35. The Consultation Document has some mixed messages about the form of SMS regulation
notwithstanding that the Advisory Circular is available to help define a means of compliance
with SMS requirements.
36. For example, the disadvantages of a voluntary regime state that “Organisations that have
adopted a SMS would also have to continue to comply with existing Rules. Some would have to
split resources across two safety systems to maintain compliance internationally and
domestically”. This implies some existing rules will not apply under SMS, but these do not
appear to have been identified. The document also states “Rules would continue to set the
minimum standards for compliance, particularly in technical areas”.
37. The high degree of operational interaction between document holders (e.g. pilots, air transport
operators, air navigation service providers, and airports) means that formal Rules with carefully
allocated and meshing accountabilities are required for the foreseeable future. SMS can
probably only be applied within the scope of the participant’s aviation document, and must not
change the fundamental roles and accountabilities of document holders. Cooperation and
collaboration between participants under their respective SMS’s is likely to bring benefits, but
this can’t extend to the participants effectively re-allocating safety accountabilities.
NZ Airports Association Submission to Civil Aviation Authority July 2013 Page 638. We agree that it is difficult for Rules to keep pace with technical and operational changes in
aviation, but it is difficult to see how safety management systems could replace the need for
regular and on-going refreshing of Rules. It would be a mistake to think that the
implementation of SMS will replace the need for an active and properly resourced Rule
development programme.
39. The consultation document also states that under a voluntary regime “There is no guarantee
that all aviation organisations voluntarily adopt a SMS. Widespread non-adoption would
undermine any benefits that proactive compliance could bring”. This appears to imply that the
success of SMS within an organisation or a sector of aviation is dependent on the whole
aviation sector being compelled to have SMS, and does not sit consistently with other
statements which have been made. This again raises some concern about the detail of the
regulatory regime intended for option 4. In our view it is feasible (though perhaps not ideal) to
have some aviation participants operating under a rule-based compliance system only, with
others overlaying rule-based compliance with the additional risk-based SMS approach.
40. NZ Airports submits that before an NPRM is developed for SMS, the CAA continues its
leadership, and consultative approach to SMS, by developing and articulating clarity of the
regulatory environment being proposed for option 4. A cooperative environment for adopting
SMS will achieve greater safety outcomes in the long run than a unilaterally imposed regime.
Consistency of requirements
41. Many NZ Airports members are approaching voluntary SMS on the basis of integration of health
and safety risk management with aviation risk management.
42. There are significant opportunities for efficiency (minimising the imposition of cost) and success
in culture change where organisations are able to embrace a holistic approach to risk
management across their organisation.
43. As far as practicable, SMS regulatory requirements should align with other risk management
legislation, such as occupational safety and health, which applies to organisations.
44. NZ Airports submits that the SMS regulatory regime should accommodate integration of all risk
management, such as health and safety, across an aviation organisation.
45. NZ Airports supports the CAA intention to have a one SMS regulatory environment apply across
all relevant Civil Aviation Rule parts as there will be potential for benefits both in terms of
safety outcomes and cost.
CAA Role to advance safety through SMS
46. NZ Airports supports the leadership role that CAA is pursuing alongside the regulatory role. It is
acknowledged that the CAA’s activities are evolving towards an intelligence-led system, good
information and analysis being the foundation for effective intervention. This requires the CAA,
alongside operators, to improve their collection and analysis of information and to make the
information available for analysis, aside from its regulatory role.
NZ Airports Association Submission to Civil Aviation Authority July 2013 Page 747. Airports find the CAA coordination of certain data to be invaluable in addressing risk
management. In particular, the recording and availability of data for bird-related incidents over
recent years is a valued resource and appreciated by airports.
48. NZ Airports submits that in pursuing option 4, there is considerable scope for the CAA to
enhance the way aviation incidents are recorded and shared with the appropriate stakeholders
and as a resource to inform an airport’s SMS. This will be a success factor for SMS in the
medium and longer term.
Response to Specific Questions
Q1. Do you support adopting a mandatory risk management approach to aviation safety?
49. NZ Airports supports a mandatory risk management approach to aviation safety subject to the
regulatory detail addressing the issues raised in this submission.
Q2. Given that for many organisations meeting ICAO requirements will be important, are
there any other options to improve aviation safety that should be assessed?
50. NZ Airports sees ICAO requirements as an important consideration and is not aware of any
other options than the CAA proposal. However, the form of the detail will be important and
should not preclude integration with other risk management obligations on aviation
organisations.
Q3. What do you think would be the implications for your organisation of moving towards a
risk management approach, such as SMS?
51. From an Association perspective, the implications will be the need for support, resourcing, and
cost-effective training for members. The Association is already progressing a project to assist
members with smaller operations to adopt SMS on a voluntary basis.
(a) To what extent has your organisation already adopted a risk management programme like
SMS?
52. Most members have made progress towards understanding SMS. In the case of Auckland,
Wellington and Christchurch airports there has been considerable progress towards
implementing SMS including the appointment of safety managers.
(b) What do you estimate it would cost you to incorporate a risk management programme like SMS
into your business?
53. No data is currently available to estimate the cost implications for members to adopt SMS.
54. The need to appoint a safety management person is potentially a threshold cost for smaller
airports. For organisations with few full time managers and staff, the additional demands could
result in the need for additional staff or other arrangements for access to appropriate
competencies, and this could result in a step-change in costs.
55. There would be cost benefits in having CAA assessors/auditors work with airports as they
progress the implementation of SMS with a particular objective of establishing systems that
minimise the subsequent and on-going audit costs – ie by simplifying the audit process.
NZ Airports Association Submission to Civil Aviation Authority July 2013 Page 8(c) What benefits would a risk management approach provide your organisation?
56. Airport businesses will benefit through improving safety indicators, reduced cost of
consequences of risk and improved relationships with key business stakeholders (such as
airlines, customers and Airways) by providing assurance of safety outcomes.
57. Benefits will accrue through the industry alignment with ICAO.
58. SMS will have benefits for business continuity and reduced costs from the consequences of risk
occurrences.
59. Related benefits for other health and safety risk may accrue through integrated management
systems and an organisational culture proactively managing risk.
(d) What difficulties do you expect if you were required to adopt a risk management programme
like SMS?
60. The difficulties are likely to arise through the “learning curve” involved in adopting a concept
that is not entirely precise.
61. Managing the cost of SMS, notwithstanding the benefits likely to accrue will be a challenge for
airport businesses. In this respect NZ Airports promotes that consideration be given to
providing a longer transition period for some sectors, or businesses within sectors, depending
on the challenges that are being faced for implementation. Consideration could be given to
allowing unattended airports and non-certificated airports a greater transition time to
implement SMS.
62. CAR Part 139 is currently under review. While the outcome is not yet known, there is the
possibility that some non-certificated airports will be required to come within the certification
regime. This in itself will require, in some cases, significant effort to introduce complying
Quality Management Systems. An obligation to take on board the requirements of SMS could
be a significant hurdle which warrants attention and accommodation. Even with this
accommodation the aviation sector would still be advancing with a safety environment that is
improved from the current position.
63. NZ Airports submits that a longer transition process to implement SMS be provided for
businesses that have specific difficulties in adopting a risk management regime.
(e) Aside from information published in the SMS Advisory Circular, what additional guidance or
support would be helpful from the CAA during any transition?
64. The leadership and education role that CAA has been taking can be continued and extended
into the transition period. This will inevitably lead to incremental safety benefits that may not
necessarily arise from a simplistically imposed regulatory regime. The success of SMS is
dependent upon a culture change and holistic approach to risk management.
65. CAA progressing the sharing of relevant data could be an activity that leads or precedes the
regulatory regime is particularly important.
NZ Airports Association Submission to Civil Aviation Authority July 2013 Page 966. Interaction between CAA assessors/auditors and those in the aviation business sector could,
during the transition phase, benefit the SMS being introduced to be more successful in terms of
safety outcomes and in efficiency for the audit and monitoring processes.
(f) What additional guidance or support would be helpful from the CAA in its on-going role as
regulator?
67. CAA clarifying what will be audited and the audit process will be helpful on an on-going basis.
68. The sharing of CAA data could be continuously enhanced on an on-going basis.
69. A lesser focus on blame and enhance focus on systems and risk identification will have safety
benefits. This involves CAA continuing to itself embrace a risk management approach to its role
as a regulator.
Q4. Have you considered the probability of your organisation being involved in an accident,
and if that happened, what do you estimate the likely range of costs to your organisation
would be?
70. Most airports are extremely conscious of the possibility of accidents arising within their
responsibilities under CAR Part 139 (particularly after the events of this weekend in San
Francisco)
Q5. About how long might it take your organisation to implement a risk management
approach, like SMS?
71. It will take many years to embed a safety culture focussed on risk identification and
management. The time taken will vary between organisations, the smaller organisations likely
to be faced with the most difficulties through resourcing.
72. The CAA’s current implementation strategy involving implementation on a voluntary basis
irrespective of the regulatory process could be influential on the success of SMS in the respect
that time taken to give effect to a mandatory system is less important providing that the
aviation sector is adopting the change being advocated.
Q6. Do you see any difficulties with the proposed two group transition approach to adopting
Rule amendments if a mandatory risk management approach is adopted (see Section 7 and
footnote 14)?
73. Benefits could accrue from having different sectors adopt SMS over different timeframes. Early
adopters may be champions to others.
74. The reference to Section 7 and Footnote 14 is unclear.
Q7. Are there any examples of specific Rule amendments that could be adopted to allow for
greater flexibility and innovation if a risk management approach were to be adopted?
75. Benefits could arise from alignment of the Rules with other risk management legislation such as
Occupational Safety and Health. The Rules should in any case anticipate integration of risk
management systems across an organisation.
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