Select Committee on Transport Minutes of Evidence

Examination of Witnesses (Questions 80-99)


11 JANUARY 2006

  Q80  Chairman: Very briefly, Mr Bell, because I do want to get on to the European angle.

  Mr Bell: We currently conduct around 200 of these a year and the plan is to increase that substantially in the years ahead. When we do them, we check the crews' licences, we check the condition of the aircraft and we do what we can without actually flying it. Suffice to say, it is, as you say, not the in-depth inspection that we might wish, but, without interfering with the schedules of the airlines for no real purpose, it would be quite difficult to do more. I think I ought to say that our main source of intelligence of the serviceability or otherwise of these comes through our current reporting system. If the maintenance organisations dealing with them or the aircraft control people who are running the service on the day pick up the problem, then we will target that aircraft.

  Q81  Mr Goodwill: Do you think it would be useful in circumstances where you pick up serious question marks about a particular airline to suggest that you be invited to their home airport where you can maybe have a more in-depth scrutiny of their services and facilities, their records, their staff training and the rest will follow where maybe you finally put them on a blacklist?

  Mr Bell: I think that is a very interesting point, but I think that politically it would be very difficult to do. It would open us up of course to the reciprocal inspection regime and we would be quite interested.

  Sir Roy McNulty: But I think it is a relevant point to what Europe does eventually. As you probably know, the United States has a programme whereby it reviews the regulatory set-up and regime in all of the countries which fly into the United States and that is a big exercise. The United States does it, and I believe eventually Europe will have to do it because blacklists and spot-checks are only a part of the solution. The main thing that needs to be done is to satisfy yourself that the regulatory regimes in the countries from which these aircraft come are sound and in a condition as we would wish.

  Q82  Chairman: I want to ask you about that because to get that sort of sweeping power that the FAA have, which is what you are talking about, which has been expanded over the last five or six years, we come back to this Single European Sky. You say you strongly support it, but you also say that the Commission often fails, or sometimes fails, to follow best regulatory practice in developing legislation. What do you mean by that?

  Sir Roy McNulty: Might I ask John Arscott to comment on that?

  Mr Arscott: We have been involved with the Department from the outset with the Single European Sky and I think we envisaged when Madam Palacio was in the Chair in Brussels a much lighter regime than the one that is emerging now, but we seek to mitigate the effects of the European legislation to as great an extent as possible—

  Q83  Chairman: How?

  Mr Arscott:— and, generally speaking, I think we have been successful, although there are some significant hotspots in terms of perhaps charging and perhaps overly prescriptive regulation in some parts of the Single European Sky legislation.

  Q84  Chairman: Well, how well is the European Commission managing all these constituent parts?

  Mr Arscott: Well, the fact that they are able to get rules through the majority of states in the Single Sky Committee and there has been no dissension to date I think they would consider to be a great success, but our objectives in a European regulatory context are subtly different from a number of other states'.

  Q85  Chairman: So do the Government not support you or are they simply not very effective in getting what they want through?

  Mr Arscott: The Government take the lead and we in fact support them in this regard and I think, as I say, that the Government in the lead and the team that we have put together in Europe in the Single European Sky has been effective given the very differing views of the Member States of the European Union.

  Q86  Chairman: So when the Association of Licensed Aircraft Engineers say your relationship is a master/servant" situation, that is not an accurate description?

  Mr Arscott: I am not familiar with that particular topic, but it is not a situation that I would recognise in the areas in which I have expertise.

  Q87  Chairman: I see. They say, It would appear to us that apart from Annex 2 aircraft the task of safety regulation falls upon the EASA...In our opinion it is this change of direction from being a stand-alone that of a competent national authority under the control of EU commissioners ...that does need an inquiry as to what the remit of the ...CAA should be".

  Sir Roy McNulty: Perhaps I might comment on that because we mistook the earlier question as relating to the Single European Sky. It is true that there is a change in the regulatory structure in Europe, but the CAA has not been a stand-alone regulator for a very long time.

  Q88  Chairman: Well, then let me ask you, is EASA fit for purpose?

  Sir Roy McNulty: That is a different question and my answer to that is so far not yet.

  Q89  Chairman: So what is it? Is it its structure, is it its management, is it its resources? What is wrong with it?

  Sir Roy McNulty: I think it is in varying degrees all of those things. I think the setting up of EASA was not well handled and it acquired significant responsibilities in September 2003 at a time when it only had a handful of staff and that is not a great way to start up an important regulatory agency.

  Q90  Chairman: So what happens if we finish up with in effect the lowest common denominator in safety regulation?

  Sir Roy McNulty: I do not think we are necessarily headed towards the lowest common denominator thing. EASA inherited a body of rules agreed through the JAA system, which this Committee I am sure is familiar with, which had been built up over many years. It took over certification responsibilities which the JAA had, and was intended to start a standardisation programme, which is really a system of audit and review of all of the regulatory set-ups in the various Member States. To date, it has proceeded with the certification work, but has had to get the national aviation authorities to do most of the work and, because of the staffing and resource difficulties, it has struggled with that certification work. The rule-making, as I—

  Q91  Chairman: Has it slowed it down or is it working at the same speed as it would have done when you had total control?

  Sir Roy McNulty: It has slowed things down compared to the JAA system. There is no doubt that EASA has brought into the certification and approval system a range of additional bureaucratic steps, added to its own resource difficulties which are causing significant delays to manufacturers in this country. They say that tasks which the CAA used to complete in days, and nobody ever suggested we were the fastest thing the world had ever seen, but things that the CAA did in days are taking EASA months at times to do and this is imposing significant problems on industry.

  Q92  Chairman: So what are the Government and what are you doing in order to change that situation?

  Sir Roy McNulty: We have been uncomfortable about the way in which EASA was evolving for a bit over a year now. We have been in dialogue with the Department and I think the Department view, I hope they will tell you, is much the same as our view, that this thing is not evolving satisfactorily. We have had dialogue with EASA on many occasions. They have sought to improve some things, but others have in turn got worse. We have had dialogue with the Commission and the Commission initially were resistant to the idea that anything was amiss. I think they are coming—

  Q93  Chairman: They really thought they were perfect—is that it?

  Sir Roy McNulty: They thought they were perfect and that we were `whingeing poms', which is the phrase which comes to mind, but the Commission would never say anything as rude as that. Basically we have been trying to persuade both EASA and the Commission that there is a problem, and what we need from both of them is action to deal with the difficulties. All of those difficulties have been exacerbated in recent times because EASA has a significant budget problem. The budget that they produced at the end of last year for 2006 showed a big income shortfall. They proposed that this be solved by slowing down or completely stopping a lot of the certification work due to be carried out this year. The Management Board very sensibly said, Get lost! That's a ridiculous idea", and basically they are proceeding at the moment with a budget which runs out of money in three or four months' time.

  Q94  Chairman: But this is bizarre, is it not, really? You are telling us that they have taken over responsibilities which they cannot exercise, they have not got the staff, they have not got the money and, in order to be able to say that they are doing the job, they are seriously suggesting slowing down the work which has a direct impact upon companies in this country and their only solution is to go cheerfully on until they run out of money half way through the year. Is that what is happening?

  Sir Roy McNulty: That is a modest summary of where we are.

  Q95  Chairman: And what is the Government's attitude to this? They are taking the work away from you or are they continuing to give you more work?

  Sir Roy McNulty: We are still doing a lot of the work, but essentially under sub-contract to EASA.

  Q96  Chairman: What does that do to your charging regimes?

  Sir Roy McNulty: It has not affected our charging regimes in a significant way because we charge the full cost to EASA.

  Q97  Chairman: So do the companies feel they are being double-charged?

  Sir Roy McNulty: They occasionally say it, but it is not correct.

  Q98  Chairman: But it must have some effect on your financial forecast, must it not, in the Corporate Plan?

  Sir Roy McNulty: The Corporate Plan reflects, as of last spring, our best guess as to the reduction in our workload. As I said earlier, the plan that we are currently finalising will show a somewhat accentuated reduction in our workload, but we will reduce our resources as our workload goes down. That is not a problem.

  Chairman: Now you have started the dogs of war running!

  Q99  Mr Leech: Can you foresee a situation where you will be being asked to charge less for the work you are currently doing?

  Sir Roy McNulty: Asked by EASA to charge less?

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