Essay: Key issues that small general aviation businesses face when operating in rural and regional Australia

Abstract
This report covers an analysis of the key issues that small general aviation businesses face when operating in rural and regional Australia put forward by Tammy Augostin as well as her proposed solutions to tackle these issues to ultimately save the industry.
Introduction
Tammy Augostin is a commercial pilot, operator and manager of Panama Airways, a charter operation offering several services ranging from charter, scenic flights and freight, and which flies to a range of destinations covering both capital cities to remote regional airstrips across Australia. She addresses the importance of regional aviation serving flights to the remotest regional areas bringing freight and passengers to regions which are not serviced by other airlines; as well as the emergency services provided such as Search & Rescue amongst others; demonstrating just how large-scale general aviation is in regional Australia.
Argument
Tammy Augostin presents the idea that general aviation plays an important role in the everyday lives of many citizens living in the remote areas of Australia, ranging from charter operations and freight to emergency services such as aerial firefighting amongst numerous others. It is evident that the people living in these far-off regions as well as businesses, rely on general aviation to transport passengers and goods respectively, as they cannot be substituted by any other service due to time and distance restrictions. Following this, the main argument that Tammy Augostin raises is that the regional aviation industry is struggling and is ultimately in danger of failing, which will lead to these people facing numerous difficulties as they are cut off from medical aid, resources and access to seeing friends and family.
Key Issues
There are several clear key issues that Tammy Augostin puts forward as she addresses the topic of general aviation. The first and foremost is the basic principle that the regional aviation industry is one which is costly and seldom provides a sufficient return on investment, which makes it an unsustainable venture if operations are continued in the same way for an extended period of time. Not only are regional airlines faced with the common issues that all airlines face, such as rising government-imposed and related costs, but they are also faced with the local economic problems of the regional areas they operate to, impacting how well regional airports operate. With continuously rising costs paired with the public pressuring these regional airlines to keep costs at a minimal and affordable rate, regional airlines are struggling to find even ground.
Tammy Augostin states that increasing regional airport costs is amongst one of the most problematic issues that GA faces today. Councils were entrusted with regional airports, due to the Aerodrome Local Ownership Programme implemented by the Commonwealth, in an effort to be preserve an indispensable asset by the local community. Councils, however, disregarded the cost factor of maintaining such an operation and regarded it as a revenue making enterprise. With no knowledge of how to handle the airports, some councils increased rates at an outstanding value which in turn drove out many GA operators. An example of this would be Councils implementing an increase in lease rates of 315% in 2013 for Bathurst airport. This issue paired with the local Council’s using the revenue gained from regional airports to fund other local council activities worked towards the deterioration of the local airports. Without proper accounts being run for these airports, the generated revenue is unable to be used in the maintenance of infrastructure and facilities of the regional airports.
Another issue is the increasing of landing fees to unpayable rates resulting in a decrease of operators landing at these regional airports. In some cases, these pilots try to land without calling on the radio; creating a dangerous hazard in order to spare themselves the cost of the landing fee. This results from poor Council planning due to a lack in experienced professional staff and inadequate business model propositions. Tied into this poor planning, is that domestic carriers with larger aircraft landing at these regional airports induces the Council to buying equipment such as PAPIs (Precision Approach Path Indicator) which are not necessary for smaller aircraft however these smaller aircraft will need to incur some of these costs on behalf of the bigger airlines as a subsidy even though they are not beneficial to them.
Aging aircraft is another problem that GA operators face. The production of smaller aircraft has halted, and GA is left with ageing aircraft that are well in their 30 years of service. This issue paired with an expectancy of maintenance standards and regulatory compliance of airworthiness will cost the operator huge sums of money. In addition to this, qualified staff is needed to operate maintenance on these aging aircraft, however in regional areas they are hard to find and again would cost a lot. Furthermore, there is already a global shortage of both pilots and engineers in Australia and most of what is left will be based in capital cities and/or employed by bigger companies which can afford their higher salaries. Technical staff shortages tie in with the reduction of rural populations as they move to the coast and capital cities where there are better employment opportunities.
Analysis of Key issues
Tammy Augostin’s paints a vivid image in terms of the struggles that GA faces, from skyrocketing landing fees, Councils misusing funds as well as staff shortages. More expensive landing fees would not help the problem as it would now be more expensive to train pilots as they charged for Touch and Go landings. As there is already a global shortage of qualified staff, the only way of attracting these people to work in regional remote locations would be to offer a good salary as well as benefits such as accommodation which would make it worthwhile for them to stay there. On the other hand regional airlines do not have the funds to afford such expenses.
Most of the issues presented seem to stem from poor judgement and leadership on the Council’s behalf. Perhaps if the Government were to oversee their operations, it would have avoided the misuse of funds and these could have been used to reinvest in the airport as well as avoided the excessive rise in land lease prices since this is a large-scale issue that both capital city airports as well as regional airports face.
It is reasonable to say that ageing aircraft is another major issue which the GA industry faces. As the aircraft are used until they are no longer functionable may leave the regional airlines struggling to replace them and may incur quite some debt in the event that they try to purchase newer aircraft. It is not mentioned however whether these aircraft can be replaced with other possible services. Charter could be taken over by some of the major airlines and with most of the population moving to capital cities raises the question as to whether we still be facing this problem. It is questionable as to whether the industry is worth saving at this point as fewer people actually live in these remote areas, especially are they worth the cost of trying to save. The issues that Tammy Augostin’s presents are on a nationwide scale. If they were to be solved it would need a huge structural change in the whole aviation industry not just in GA terms. In this case I believe that her thinking is too narrowminded.
Responses and Strategies
Tammy Augostin does not directly suggest a solution to combat these issues however she comments that regional general aviation community does not want any aid from the government in the form of money handouts and that all the industry needs is support and a change in perspective. In other words that the Government and local councils differentiate between larger airlines and the general aviation industry and that they operate in a completely different manner; therefore, implementing procedures such as costly regulatory measures should be altered accordingly. This would mean charging more sustainable and equitable landing fees in regional areas as well as reducing the escalating costs for regulatory services. It is further alluded to the fact that more qualified personnel would greatly help in the process of decision making on all official levels of management, especially in handling funds. If the revenue yielded by these regional airports was now prevented from being used to fund other council activities, it could be funnelled back into the airport to upgrade current amenities and help with maintenance and employing more staff; ultimately making it a more attractive and viable destination which could attract potential visitors and businesses. Imperatively, the Government needs to realise that these services are vitally important to these regional communities, both socially and economically.
Analysis of Responses and Strategies
Whilst I agree to some extent that support and better staff will be beneficial to the industry, help in the form of money would greatly beneficiate some of the more struggling regional airports or airlines in maintaining important airport facilities such as runways which are extremely costly. Furthermore, reflecting already on the shortage of qualified staff present, she does not comment on how it would be possible to either train or find these new staff without offering high salaries to people that would rather live in more urban areas. Perhaps a new training scheme implemented by the government could be beneficial or special rates could be afforded to student pilots so as to encourage training.
It is certain that more regulation towards councils would greatly benefice the GA industry as landing fees will be capped and Councils will not be allowed to raise rates without supervision. This would enable a better control of costs and allow the airports to raise revenue and reuse it. As facilities are slowly improved this could enable more traffic flow and ultimately save these airports from collapsing.
Tammy Augostin also comments on the impact that not implementing these solutions will have. Amongst these she regards that larger companies will take over the smaller charter operations, however she does not consider that this may actually help the industry as these bigger airlines have more resources and better qualified staff. As these regional airlines follow the drifting of the population towards major urban areas, they will be met with higher competition however this might outweigh the fact that they would have access to more qualified staff as well as a larger client base. Besides she does not discuss that businesses are also likely to help subsidise some of the costs so that their goods can be transported to these regional airlines, which could offset some of the costs of the more urgent goods that need to be transported to these remote areas.
Overall due to the scale of the issue, it is up to the Government to take the first step in attempting to impose stricter regulation on Councils and/or help with financial aid. It is debatable however, as to whether this industry is saveable and worth the cost of saving as we move towards a more technologically advanced industry where these retiring aircraft could be replaced and made redundant.