By: James Cooper and Merinda Stewart

Yesterday, the Australian Government released its long-awaited Aviation White Paper – Towards 2050, setting out the Government’s plans for the aviation industry in Australia for the next two and a half decades, and building on its previous National Aviation Policy White Paper in 2009.

We set out the key areas of focus identified by the White Paper.

Passenger protection

Passenger protection reforms sit front and centre of the Government’s plan. While the new proposed measures do not bring Australia into line with the EU passenger protection legislation, which is particularly favourable to passengers, they foreshadow a more streamlined passenger redress scheme and greater transparency when confronted with delays or cancellation of a flight, or lost, delayed or damaged baggage or mobility devices.

Under the White Paper, the Government outlines the plan to legislate an Aviation Industry Ombuds Scheme, which will encompass both an independent dispute resolution mechanism and performance monitoring services. The scheme provides an Aviation Customer Rights Charter, designed to give greater transparency for passengers by setting out what the ombudsperson will consider to be reasonable conduct by airlines and airports. The ombudsperson will have the power to investigate and mediate complaints and direct remedies to be paid by domestic and international airlines and Australian airports to passengers, including the payment of refunds for flights that are cancelled or significantly delayed. Under a so-called ‘show cause’ arrangement, airlines will also be required to report reasons for cancellations and delays as part of their duties to regularly report flight data.

The Government has also announced plans to create aviation-specific disability standards, obliging airlines and airports to work together to facilitate travel for people with disability. As part of the standards, the Government is considering prohibiting airline policies that restrict the number of passengers onboard who require assistance to two (‘2-wheelchair policies’), unless a clear safety argument can be made for maintaining the restriction. Other measures to improve accessibility include requiring airlines to provide assistance profiles to passengers, so that passengers with assistance requirements can inform airlines of the requirements in advance, and increasing the compensation for passengers whose mobility devices are damaged or lost by airlines.

There is currently an Airline Customer Advocate, which was established in 2012 – but it has largely been viewed as ineffectual. Unlike the proposed Ombuds Scheme, the Airline Customer Advocate is not independent as it is funded and managed by Australia’s major airlines.

Reduced barriers to competition

High barriers to competition impact both airlines and airports in Australia. The White Paper announces measures to address that issue. It discusses the expected benefits that will flow from the previously announced reforms to the slot regime at Sydney Airport and the opening of Western Sydney Airport, scheduled for 2026, and the expectation that improved access to Sydney Airport will lead to increased competition across Australia.

Regulating the relationship between airlines and airports is also a focus of improving competition. The Government plans to revise the principles for the aeronautical pricing negotiation process between airlines and airports and enhance the ACCC’s data collection and monitoring at Australia’s major airports. The ACCC’s expanded role in this area under the White Paper is in addition to the direction the ACCC received in November 2023 to actively monitor airline prices, costs and profits.

Minimising the negative impact of aviation: noise reduction and the pursuit of net zero emissions

The aviation industry makes up around 2.5% of total global carbon emissions. Efforts to decrease the impact of aviation on the environment have been on the international agenda—and to varying extents, regional and national agendas—for many years now. EU law requires airlines operating from its airports to begin a phased inclusion of sustainable aviation fuels (SAF) in their aircraft from 2025. The Australian Government has included in the White Paper initiatives to support the development of a low-carbon liquid fuel (LCLF) industry in Australia, with an initial focus on SAF and renewable diesel. There is also discussion about the role that fleet renewal and optimising flight paths will play in reducing carbon emissions.

The White Paper also announces the introduction of an independent Aircraft Noise Ombuds Scheme, as part of the Aviation Industry Ombuds Scheme, to investigate how Airservices Australia manages noise complaints. Airservices Australia will also have additional reporting obligations through its Noise and Flight Path Monitoring System and will introduce a new role within the organisation, responsible for noise and environment, which will report to the CEO.

Connecting regional Australia and connecting Australia to the world

Rex’s recent entry into voluntary administration has naturally led to discussion on what can be done to better service and maintain regional Australia when it comes to aviation. The consultation for the White Paper found that the requirements of communities in regional Australia are not being met by existing services. The White Paper sets out the further concerns that arise as a result of many regional routes being serviced by a monopoly operator. This aspect of regional connectivity ties back in part to the issue of barriers to competition in the industry. The Productivity Commissioner has been directed to undertake a review of the determinants of regional airfares to help address these concerns.

The White Paper includes significant funding increases to regional aviation programs. The Remote Airstrip Upgrade (RAU) will receive an additional $50 million over three years from 2024-25 and the Regional Airports Program will receive $40 million over three years from 2024-25. The programs together, and along with complementary government-funded programs, aim to improve safety and connectivity, subsidise regular transport services to remote communities, and assist in the transition to net zero and enhancing climate resilience.

In terms of global connectivity, the White Paper outlines a commitment to negotiate favourable terms for Australia in its bilateral air services agreements, including increased capacity and ‘open skies’ style of agreements where possible. It also announces reviews to border security measures and a focus on DFAT-funded development transport assistance programs across the Asia-Pacific region.

Workforce shortages

Australia is experiencing a skills shortage in the aviation industry, including a critical shortage of air traffic controllers and a shortage of pilots and licenced aviation maintenance engineers. The White Paper sets out changes to licensing and training in an attempt to address these skills shortages.

A Gender Equity Charter for Aviation will also be introduced, which will entail commitments to those who choose to sign up, to reach targets for the employment of women and to eradicate gender pay gaps in an industry that continues to be dominated by men. Some aviation grants from the Australian Government will only be available to signatories to the charter.

Drones

When it comes to drones, the White Paper provides an overview of the Government’s continuing work in the area, including in air traffic management, ID requirements for drones, noise regulation, infrastructure planning, and achieving greater consistency in regulation across Australia.

Safety and security

The White Paper outlines a 4-stage reform of Australia’s airspace management, which is based on the anticipated increase in air traffic by 2050 and the challenges brought about by new aviation technologies. The four stages culminate in anticipated legislative changes in 2030 to the Airspace Act 2007 (Cth) and the Civil Aviation Act 1998 (Cth). The first stage begins in 2025 and will begin the rollout of the integration of uncrewed aircraft into controlled airspace.

Revitalising general aviation

Many of the issues addressed elsewhere in the White Paper tie into a strong future for general aviation (GA). GA provides the expertise for the broader aviation industry in that many aviation professionals build their experience in general aviation, and skills shortages have the greatest impact on GA. GA businesses also design and manufacture many new aviation technologies and will be a vital part of the industry in the move towards decarbonisation. The management of airspace and safe integration of drones will also be critical to the future of GA.

More specifically to GA, the White Paper outlines the obligations on CASA to review its GA Workplan to reduce regulatory burdens for GA, and on airport operators to ensure GA is provided with adequate access to airport sites during the approval process of new plans.

Where to from here?

Some challenges the White Paper attempts to alleviate are not new in Australia: a lack of competition, the need for greater regional connectivity, and skills shortages. At the same time, the Australian aviation industry faces new challenges, together with the rest of the world, in navigating the shift to decarbonisation and the integration of drones in shared airspace.

The White Paper is comprehensive and presents policy and regulatory changes that have the potential to lead to significant change for the industry, with benefits in different areas for all parties.

It was clear from the consultation process that the perceived quality of the passenger experience had fallen in Australian aviation in the post-COVID landscape and, in an attempt to address this, passengers potentially have the most to gain under the White Paper. The impact of these changes will of course depend on the details of the scheme as they are further revealed, and on how it functions in practice as it gets underway. Airlines and airports, in particular, will need to monitor those changes closely.