This is the second Report to Parliament in accordance with the requirements of Section 29 of the Air Navigation Act 1920-1961.

During 1961/62 the domestic airlines performed 148.337 million short ton miles, a slightly less than the 148.824 million short ton miles performed during the previous year. This somewhat static traffic situation was largely brought about by a further decline in freight traffic to a negative annual rate of 7 per cent and to the fact that passenger traffic increased by only 1.3 per cent. Mail showed a useful growth of 5.5 per cent.

Although these figures are not in themselves particularly satisfactory, they do show encouraging improvement over the depressed rates of traffic growth experienced in the second half of the 1960/61 financial year and are clearly demonstrative of a definite recovery in the general economy of the country. While the two major airlines failed achieve any significant increase in total traffic carried, it is interesting to note that three local airlines in New South Wales and Queensland achieved an average of 4.5 per cent increase and MacRobertson Miller Airlines in Western Australia finished the year with an outstanding 12.1 per cent increase. This latter result reflected in particular the great amount of development work taking place in the West.

In the first few months of this financial year, air traffic has continued to grow in a quite encouraging way, although the growth of passenger traffic on the important Melbourne-Sydney route has been affected, as predicted in my Report last year, by competition from the standard gauge railway.

In the international field Qantas, despite increased competition, managed to secure very positive growth in all forms of traffic. For the year ended June 30th, 1962, passenger traffic increased by 16.7 per cent, mail by 10 per cent and freight by 5 per cent. This gave an increase in total ton miles performed of 12.4 per cent. In order stimulate this growth, Qantas had to provide additional aircraft capacity, so that a decrease in load factor occurred.

The financial results reported by the two major domestic airlines and by Qantas are, I think, quite satisfactory if one has regard to the generally depressed state of both domestic and international airlines in other parts of the world.

Trans-Australia Airlines, before making provision for future taxation of £100,000, an operating profit of £563,333, which is the best it has yet achieved. From this it will pay a 5 per cent dividend on its Government subscribed capital of £7.5 million. For the coming year I have, after consultation with the Commission and with the concurrence of the Treasurer, determined a profit target of 6 per cent in accordance with the provisions of Section 32 (1) of the Australian National Airlines Act 1945-1961. Given reasonably good trading conditions, there is every prospect of the Commission achieving this target.

Ansett Transport Industries, of which Ansett-A.N.A. and the subsidiary local airlines (Airlines of New South Wales, Airlines of South Australia, Queensland Airlines and Ansett-Mandated Airlines) form a substantial operating element, announced a profit of £1,066,256 before provision for future taxation of £250,000. It has announced its intention to pay a final dividend of 5 per cent, making a total dividend of 10 per cent for the year.

These results provide clear proof of the success of the Government's rationalization policies, for they show that the major domestic airlines were able to declare satisfactory profits in a year when total air traffic carried was slightly less than in the previous year and costs were generally higher. The control of aircraft capacity under the provisions of the Airlines Agreements Act 1961 and the associated Airlines Equipment Act 1958 had the most important single effect, resulting as it did in the maintenance of profitable load factors in a year of static traffic growth. It is also significant that only one increase in air fares - a flat 10s. per sector in tourist class - was made during the year.

Our international airline, Qantas, had a net operating profit £408,817 and declared a 3 per cent dividend to the Commonwealth. While this cannot be regarded as anything but a marginal result by normal commercial standards, it is gratifying when one has regard to the fact that most international airlines incurred substantial operating deficits, totalling in all more than £50 million. The superb standard of service provided by Qantas and the careful attention given by its management to cost levels have enabled it to achieve an operating surplus in what was generally a very difficult year for the international airlines.

I would also like to pay tribute to the Commonwealth airlines which operate in partnership with Qantas - British Overseas Airways Corporation, Air India, South African Airways and Tasman Empire Airways Limited. Their co-operation and support have been invaluable. B.O.A.C., Air India and Qantas now provide, with Boeing and Comet jet aircraft, some seventeen weekly return services to the United Kingdom from Australia and four Boeing return services a week from Australia to the Far East. Qantas and South African Airways jointly provide a weekly return service to South Africa, while T.E.A.L. and Qantas together provide a peak trans-Tasman frequency of 31 weekly services. B.O.A.C. will join this partnership on the Tasman in April of 1963. This comprehensive network of air services is a most striking example of the value of Commonwealth co-operation in international civil aviation.

During the year the major domestic airlines have given intensive consideration to the procurement of jet aircraft. In accordance with the agreements reached between them and approved by Parliament in the Airlines Agreements Act 1961, the airlines will be free to make application for jet aircraft after November 18th of this year. They have agreed, however, that jet aircraft will not be placed in operation before 1st July, 1964, and that each airline will introduce its first and second jet concurrently with the other's first and second jets. It is expected that they will make prompt application for these aircraft, but to date there is no certain indication of the type of aircraft they will wish to purchase. In the heavier class of jet aircraft the types available are the De Havilland Trident, powered by Rolls Royce Spey engines, the Boeing 727, powered by Pratt and Whitney engines, and the Sud Est Caravelle, powered by Pratt and Whitney or General Electric engines. Each of these aircraft will carry about 100 passengers in mixed tourist/first class configuration at subsonic speeds of up to 600 miles per hour. In the lighter class of jet aircraft the principal contender appears to be British Aircraft Corporation's One-Eleven, powered by Rolls Royce Spey engines. This aircraft will carry about 65 passengers at a speed of about 540 miles per hour. The Douglas Aircraft Company has design plans for an aircraft of similar size and performance but no firm decision has yet been taken as to whether or not it will go into production. The Fokker Aircraft Company plans to build an even smaller jet aircraft to be known as the F.28.

Under the terms of related legislation, the airlines are required to purchase aircraft of comparable size and performance. This means in practice that one airline could not acquire its first two aircraft in the heavy class and the other its two aircraft in the light class, since the disparity in performance could have disturbing effects on the balance of the competitive two airline system. It is expected that the decision finally made by the airlines will raise important issues for the Government in respect of national airport development. These issues will be considered before the end of the year.

In general aviation the calendar year 1961 saw further big increases in all forms of activity. An additional 50 aircraft were added to the charter fleet, 34 new charter licences were issued, and in all 88,000 hours were flown; in aerial agriculture 56 active operators employed a total of 205 aircraft -their most important single achievement was to top dress 5.17 million acres, an increase of 40 per cent over the 1960 figure; in private flying 50 additional aircraft were placed in service and some 66,000 hours were flown; in flying training an impressive total of 120,000 hours was flown. In all, some 368,474 hours were flown in general aviation in 1961, which may be compared with 232,024 hours flown by the scheduled airlines in the same calendar year. There is no doubt from these figures that general aviation is making its own special and significant contribution to the wide variety of services now provided by Australian civil aviation.

I am pleased to be able to report an enthusiastic response to the Australian Flying Scholarship Scheme which came into operation during the year. More than 700 applications were received and of these 278 were from persons educated to Leaving Certificate standard or higher. Some 400 applicants were selected for interview and finally 148 scholarships were granted, five of them to women pilots who wished to become instructors with flying training organizations. In 1962/63 £40,000 will be allocated to the scholarship scheme, but this will be increased to £50,000 in the following year. I am certain this scheme will do a great deal to meet the increasing demand for commercial pilots that exists in this country. The co-operation extended by the Royal Federation of Aero Clubs, the Association of Commercial Flying Organizations and the representatives of airline companies to my Department in the launching of this important national project, is gratefully acknowledged.

The Government made a number of important policy decisions during the year with respect to the provision of ground facilities and services. Approval in principle was given in August, 1961, to the extension of the north-south runway at Sydney into Botany Bay. When completed this extension will do much to improve the capability of the airport to receive and dispatch large jet aircraft on international flights and will also assist materially in keeping noise nuisance to a minimum. The Government this year also approved in principle the development of the runways, taxiways and aprons at Launceston airport and the construction of a new terminal building. These new facilities will greatly assist the handling of aircraft and passengers at Launceston airport, which is now the sixth busiest in the Commonwealth. It is expected that both these projects will shortly be submitted for the consideration of the Joint Parliamentary Committee on Public Works.

Among the major airport works completed during the year were extensions to the runways, taxiways and apron at Perth, making possible the operation of heavy jet aircraft, and the construction of a new airport control tower and terminal building at the same airport; the construction of a new runway and building area at King Island, which will have the effect of removing payload restrictions on the air freighter aircraft whose operations are so important to the economy of the island; and the construction to the first stage of a new secondary airport at Jandakot, Perth, for training and agricultural aircraft. In addition, major improvements were made to several airports in New Guinea. The runway at Lae has been sealed to give a more satisfactory pavement for the heavy traffic at this airport; a new concrete apron for heavy aircraft, an operations building and a control tower have been constructed at Port Moresby; and the runway at Madang has been extended to make it possible for the many freighter aircraft which operate from this airport to carry greater payloads to the Highlands at an improved level of safety.

In addition to these improvements, I am pleased to be able to report that a total of nearly £500,000 was spent on locally owned airports throughout the Commonwealth during the year. The Commonwealth's share included grants to local authorities on a 50/50 basis totalling £234,000 for capital development and £55,000 for maintenance. It also spent £5000 in maintenance grants to owners of privately owned aerodromes in outback areas. In addition the Department itself gave valuable practical assistance in these outback areas towards aerodrome development by the use of its mobile maintenance units.

Important approvals were given during the year for the extension of the nation's airways navigation and communication system. It was decided that the air traffic control radar installations now proceeding in Sydney and Adelaide at a cost of £770,000 would be extended to Melbourne, Brisbane and Perth. This brings the total cost of the ground based radar programme to £2.5 million. When operated in conjunction with airborne radar, which has been made a mandatory requirement for all Australian airline aircraft by 1st June, 1963, radar surveillance of the nation's controlled airspace, by pilots and controllers, will have been considerably extended. On the navigation side, approval has been given for the installation over the next four years of sixteen visual omni radio ranges for primary directional guidance, and of four international standard distance measuring equipment beacons at Sydney, Melbourne, Brisbane and Perth. In the communications field, work proceeds apace to develop further high quality direct speech facilities between air traffic controllers and pilots operating aircraft in controlled airspace.

I am confident that all these important technical improvements to our airport and airways system will contribute significantly not only to the safety of aircraft operations, but also to the regularity and efficiency of such operations.

It will be seen from the digest of the Australian aircraft register at Appendix 7 that one hundred aircraft were added to the civil fleet during the year. It is particularly satisfying that the airworthiness policies followed over the years have resulted in a substantial modernization of the fleet and this, together with the progressive retirement of obsolete aircraft and of those with unsatisfactory safety features should provide a sound basis for future development. It is especially pleasing to report that two Australian designed and built light aircraft, the Victa Air Tourer and the Yeoman Aviation Cropmaster, have now been formally issued with a Certificate of Type Approval.

Departmental administration during the year has again been based on the comprehensive and modern code of aviation law mentioned in my last Report. For convenience, I have included at Appendix 1 a summary of the Acts of Parliament administered by my Department and a list of other Acts affecting civil aviation. I have also included in the main body of the Report a section dealing with the status of certain current litigation affecting civil aviation activities which I am sure will be of interest to the Parliament.

In the first full year of the operation of major business concessions at airports, revenues accruing to my Department have increased from £86,000 to £195,000, a growth of 127 per cent. This very satisfactory progress has been brought about by enterprising development of new and existing concessions.

The total staff of the Department reduced slightly from 4983 to 4981 during the year. As I mentioned in my last Report, there has been a substantial reduction in staff during the last decade despite the increasing administrative burden imposed on the Department by additional statutory responsibilities and a rapidly growing civil aviation industry. With the technical development planned in the next few years I believe it inevitable, however, that some additions to the staff establishment will be necessary.

I would like to record my appreciation of the efficient and loyal service given by all members of the Department during the current year. In particular I record with pleasure awards made by Her Majesty, Queen Elizabeth the Second to the following four officers of the Department for long and meritorious service to the Commonwealth: Mr. A. J. S. Scott, formerly Director of Finance and Stores, M.B.E.; Mr. J. F. Montgomery, formerly Stationer, B.E.M.; Miss S. C. C. Austin, Supervisor (Typists), B.E.M.; and Mr. D. L. G. Turner, formerly Marine Officer, B.E.M.

Shane Paltridge
Minister of State for Civil Aviation

Next year's Report

Previous Report in this series