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Introduction and overview

1. Year in review

Business Division significant activities

Regional services

In 2006-07 the Department of Transport and Regional Services continued to work with Area Consultative Committees, Sustainable Regions Advisory Committees, the Regional Women's Advisory Council, Indigenous communities in the East Kimberley and in partnership with state, territory and local governments, the private sector and regional communities to assist regional Australia to respond to change.

The government provided grants for 338 projects under the Regional Partnerships Programme and 13 projects under the Sustainable Regions Programme.

The Department continued to improve its processes for improving the administration of the Regional Partnerships Programme. Changes were also made to the programme aimed at improving the timeframe within which projects are approved.

The Sustainable Regions Programme completed the majority of projects funded under the initial eight Sustainable Regions and the Darling Matilda Way Sustainable Regions Advisory Committee provided final project funding recommendations to the Minister for Transport and Regional Services for consideration.

In May 2007 the Department facilitated an annual national conference of Area Consultative Committee (ACC) Chairs and Executive Officers at Old Parliament House in Canberra with the theme of "Enhancing Our Regions Through Leadership and Excellence." The Department also implemented changes to ACC boundaries following a government review in November 2006 in order to better reflect areas of common interest, and improve the overall effectiveness of the ACC Network.

The government continued to provide air subsidies for 235 remote communities supporting transfer of goods, services and passengers through the Remote Air Services Subsidy Scheme.

The Growing Regions Conference was held in July 2006 which attracted more than 300 delegates from Australia and overseas.

The Department's international engagement on rural policy was further increased by two representatives attending the Organisation for Economic Cooperation and Development meetings in Edinburgh, and its involvement in an international rural policy review for Finland.

A report of the inquiry into Women's Representation on regional and rural bodies of influence was launched by Senator the Hon Judith Troeth and the third Regional Women's Advisory Council was appointed.

Work continued on the National Regional Evaluation Framework (NREF), a whole-of of-government approach to analysing the conditions of Australia's regions, providing an improved empirical basis for place-based policy development and better targeting of regional programmes.

As lead agency for the East Kimberley Indigenous communities COAG trial, the Department successfully hosted a regional Women's Leadership course for 25 local women and worked with the Yirriman Group to provide development and cultural opportunities for young Indigenous people.

Territories and local government

Local government supported to deliver essential services

The Australian Government's commitments made in response to the House of Representatives Standing Committee on Economics, Finance and Public Administration report Rates and taxes: a fair share for responsible local government (also known as the Hawker report) continued to be implemented.

Advice was provided to the Government in relation to a parliamentary resolution on local government which was passed in October 2006. The Department developed the terms of reference for a study by the Productivity Commission into local government revenue raising which were issued by the Treasurer in April 2007.

The Commonwealth Grants Commission reported on the distribution of local road grant funding through the Financial Assistance Grants, recommending an interim redistribution. The government did not accept the recommendations and agreed to extend the supplementary road grant for local governments in South Australia.

Territory services on target and governance improving

The government spent a total of $62.9 million through the Services to Indian Ocean Territories (IOT) Administered Programme. A range of services was provided to Christmas Island and the Cocos (Keeling) Islands, either directly or through service delivery arrangements with the Western Australian Government or through contracted service providers.

This financial year saw the completion of the review and evaluation of market-testing outcomes for the Indian Ocean Territories Health Services. The resulting recommendation to retain responsibility for the services within the Australian Government was agreed by the Minister for Local Government, Territories and Roads.

The Department successfully progressed the negotiation of a new collective agreement for IOT employees with the Union of Christmas Island Workers.

Following consideration of changes to Norfolk Island's governance arrangements, the Australian Government announced its decision not to proceed with proposed changes.

Support for disaster relief, recovery and mitigation

Through its role in managing the Government's Natural Disaster Relief and Recovery Arrangements, the Department helped to provide prompt relief assistance for the victims of a range of natural disasters, including flooding in the Hunter and central coast regions of New South Wales and the Gippsland region of Victoria, and fires in Victoria and Tasmania.

Australian Transport Safety Bureau

Safety enhanced

The Australian Transport Safety Bureau (ATSB) continued to initiate aviation, marine and rail accident investigations and release important investigation reports, including a final 500-page report on the Fairchild Metroliner aircraft fatal accident at Lockhart River. In April, the ATSB launched the new Safety Investigation Information Management System (SIIMS) on time and within the $6.1 million budget set by the Government. The Bureau assisted Indonesia with investigation of the 7 March 2007 Garuda 737 fatal accident in which five Australians died and two were seriously injured. The ATSB facilitated stakeholders' initiation of 205 aviation safety actions, and made 19 aviation, 38 marine and 39 rail safety recommendations.

ATSB aviation and road safety research and statistical reports were well received by stakeholders.

The ATSB safety website www.atsb.gov.au had almost 800,000 new users and received over 30 million hits.

Office of Transport Security

Transport security enhanced

On 31 March 2007, the Department managed the introduction of new aviation security measures restricting the quantity of liquids, aerosols and gels that can be carried on board aircraft flying to and from Australia. This major initiative was achieved with minimal disruption to the travelling public and is consistent with international arrangements. The success of the introduction was the culmination of months of hard work by departmental staff along with major airlines, airports, foreign governments, regulators, duty-free retailers and travel agents.

The Maritime Security Identification Card (MSIC) scheme commenced in Australia on 1 January 2007. The scheme requires that anyone who needs to enter a maritime security zone unescorted must have a background check and must hold and display a valid MSIC. Across Australia, the MSIC scheme covers 73 ports and 364 related facilities, 59 ships and 76 offshore oil and gas facilities and service providers. Currently approximately 80,000 people working in the maritime and offshore oil and gas industries hold MSICs.

The MSIC scheme is part of the Australian Government's investment to secure the maritime industry from threats of terrorism and other unlawful acts that would disrupt maritime operations. The background checking process is just one element of how transport security is being strengthened across Australia. Security identification cards, issued subject to a background check, deliver some assurance that people who hold such a card are not a security risk.

In March the Department completed a significant task of assessing over 900 transport security programmes covering major airports, airlines and regulated air cargo agents. Following the budget announcements in May 2008, the Department will be responsible for implementing a range of additional initiatives including the extension of checked bag screening to an additional 26 Australian airports and further improvements to existing air cargo security regimes.

International cooperation

In May 2007, Australia, Japan and the United States conducted a trilateral 'Port Needs Assessment' in the Philippine ports of Davao and General Santos City. This assessment will allow for better coordination of counter-terrorism capacity building activities and inform a joint capacity building project to be undertaken in these ports.

The Joint Indonesia-Australia Aviation Security Project was completed in April 2007 and was a $1.1 million, 18-month project focussed on improving the skills and training of Indonesian aviation security personnel. It also enhanced the Department's Jakarta-based officers' relationships with their Indonesian counterparts.

Aviation and airports

Aviation and airport developments

In aviation, the Department responded to continued growth in the industry.

Growth was reflected in the increasing number and scale of airport development proposals, calling for a balanced approach which supports the development of airports as important national infrastructure but also takes full account of planning and environmental considerations. The scheme for regulating developments on the major airports was reinforced by amendments to the Airports Act 1996 passed in 2006-07. Additionally, the Department participated in the Productivity Commission (PC) review of airport pricing and assisted in the development of the government's response to the PC's recommendations.

In relation to international air services, support for liberalisation of air services agreements continued. A highlight was the agreement to a substantial growth of capacity on routes to the Middle East and beyond, opening additional options for travel to major hubs in the Middle East or beyond to destinations such as North Africa and Eastern Europe.

In the domestic airline industry, passenger numbers increased on both regional and capital city routes. However the situation in the general aviation sector is more mixed. The Department supported the work of the General Aviation Strategic Industry Leaders Group appointed by the Deputy Prime Minister to develop an Industry Action Agenda. The primary purpose of Action Agendas is to promote industry leadership, help industries develop strategies for growth, agree on priorities and make commitments to change. The Leaders Group will report back to government in April 2008.

A substantial rationalisation of the framework for airspace management occurred to provide an effective regulatory framework for the aviation industry, with new arrangements coming into effect from 1 July 2007. The main regulatory functions for airspace were transferred by legislation from Airservices Australia to CASA. An Australian Airspace Policy Statement was prepared and issued by the Minister to set clear directions for airspace management.

Recognising the key roles played by CASA and Airservices in the aviation industry, comprehensive Statements of Expectations were developed to guide their work within the legislative framework. The statements were issued by the Deputy Prime Minister in March 2007. The Department continues to take a lead role in ensuring coordination across the portfolio agencies and with the Department of Defence on aviation issues.

There was a focused engagement on regional and global transport issues. From 1 July 2006, the Department took over the chair of the APEC Transportation Working Group, and managed preparations for the successful meeting of APEC Transport Ministers in Adelaide in March 2007 (see Case Study). The Department continues to play an active role in the International Civil Aviation Organisation, including in work of the anagement on the environmental impacts of aviation.

AusLink

Infrastructure planning and investment-AusLink

Strong progress was made on the continued implementation of the National Land Transport Plan under AusLink 1.

A number of national projects were completed, including a $116 million programme of works along the Barkly Highway in far western Queensland and the opening of the $524 million Albury-Wodonga Bypass by the Prime Minister in March 2007.

After assessment of the 495 applications received by May 2006 for the Strategic Regional Programme, the Government announced funding for 86 projects in late 2006, then another 102 in May 2007. As at 30 June 2007, this meant that 209 projects at a value of $304.8 million are being funded under this programme. Additionally, more than $345.9 million was provided to local communities during the year through the Black Spot and Roads to Recovery Programmes.

Overall, $2.77 billion was spent by the Australian Government in 2006-07 on land transport infrastructure. Of this, approximately $1.5 billion was spent on road projects, $312 million of which was on maintenance. Around $11 million was spent on research and transport innovation projects.

During the year, the Department also successfully developed Corridor Strategies with each state and territory, for each of the 24 National Network corridors. These key planning documents establish the National Network priorities and will form a basis for future AusLink funding decisions.

Additionally, the Department has been working closely with the Queensland Government on the implementation of the Australian Government's decision to fund the $2.3 billion Goodna Bypass project in south-east Queensland. As the largest single road infrastructure project funded by the Government, the bypass will assist in relieving the growth pressures being experienced in the region.

The Department finalised a memorandum of understanding with the Australian Rail Track Corporation (ARTC) to facilitate progress of rail programmes funded under the AusLink programme. Significant progress has been made by the ARTC on major rail projects particularly in the main north-south corridor. These include completion of the $80 million Sandgate Flyover, $16 million Wagga Wagga rail bridge, $5.3 million Nammoona Crossing Loop and $7.7 million Leeville Viaduct on the north coast.

The success of the AusLink programme was recognised in the Australian Government's announcement of AusLink 2 in the May budget. This commitment of over $22 billion, around a 40% increase on previous funding, will take the AusLink national transport framework forward to 2015, and will build on the strong performance of the programme since its commencement.

Maritime and land transport

Council of Australian Governments transport reforms

The Department continued to support the role of the Australian Transport Council (ATC) in delivering the transport reform objectives of COAG, including providing secretariat services to the ATC. During 2006-07 the focus of ATC work was in developing COAG's response, in conjunction with Commonwealth, state and territory COAG and transport officials, to the recommendations of the Productivity Commission's review of road and rail freight infrastructure pricing. Departmental officials are involved in progressing key research work in support of the task allocated to the ATC by COAG of oversighting a new Road Reform Plan that takes a phased approach to the reform of road pricing aimed at promoting a more efficient, productive and sustainable provision and use of freight infrastructure.

Further significant COAG work in which the department was involved during the year included progressing heavy vehicle regulatory reforms (such as the heavy vehicle driver fatigue reform package), developing and trialling of performance-based standards, creating high productivity road networks including a national network for B-triples and delivering a national policy for the increased use of quad-axle trailers on heavy vehicle combinations.

Tasmanian freight subsidy arrangements

Advice was provided to the government on its response to the Productivity Commission's Inquiry Report on Tasmanian Freight Subsidy Arrangements. The response establishes a framework for introducing reforms to the Tasmanian Freight Equalisation Scheme and the Tasmanian Wheat Freight Scheme from 1 July 2008.

Liner shipping regulation

The Department also played a major role in the development of the Government's response, during 2006-07 to a Productivity Commission review of Part X (International liner cargo shipping) of the Trade Practices Act 1974. The government's proposed reforms will enhance competition between shipping lines within the Part X regulatory framework and are aimed at ensuring Australian exporters and importers in all states and territories have stable access to high quality liner cargo shipping services of adequate capacity, frequency and reliability.

Australian Maritime College

During the year the government agreed to a proposal to integrate the Australian Maritime College with the University of Tasmania with the Department playing a lead role in negotiating the details of the integration and in developing associated legislation to allow the integration to proceed on 1 January 2008.

Maritime environmental legislation

The Department had lead responsibility for developing three pieces of legislation passed by the Parliament during 2006-07 to reduce the impact of shipping on the marine environment. The legislation regulates the use of harmful anti-fouling substances on ship's hulls; updates the regulation of discharges of oils and noxious substances; and limits emissions of sulphur oxides and nitrogen oxides from ship exhausts.

Bureau of Transport and Regional Economics

In 2006-07 the Bureau of Transport and Regional Economics (BTRE) released 18 major research and statistical publications in areas of portfolio interest. These included Australian rail freight performance indicators 2005-06, commencing a new series developed in partnership with the Australasian Railway Association and Estimating urban traffic and congestion cost trends for Australian cities, a report which informed the Council of Australian Governments (COAG) review of urban congestion trends, impacts and solutions.

BTRE provided a secretariat both for this review and for the second edition of the National Guidelines for Transport System Management in Australia. These guidelines have been adopted by all jurisdictions for evaluating new public road and rail infrastructure projects.

The BTRE Transport Colloquium was held in June at Old Parliament House, Canberra, with the theme Australian Transport - Policy Challenges for Future Growth. Some 200 participants engaged with topics including road and rail regulation, transport infrastructure investment, future road safety strategies and the climate change challenge for transport. BTRE's Regional Perspectives conference was held in Beechworth, Victoria in September, with the theme of 'Regions are Big Business'. Participants from major firms, communities, academia and government discussed the potential regional economic development benefits flowing from the investment decisions of large enterprises.

During 2006-07, the Strategic Projects unit provided advice on a range of issues affecting the longer term interests of the portfolio. These included telecommunications services in regional Australia, water reform and natural resource management. From July 2007 the unit will be subsumed within the BTRE.

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