Air Traffic Control Symposium on Organisational Reform Options Experience of the Irish Aviation Authority

Donal Handley 7th July 2015

IAA Role

• IAA Act 1993 - Semi State Body established 1994

• Commercial State Sponsored Body – No State Financing • No loans, grants, subventions • No bank loan guarantees or other support • IAA pays Corporation Tax at 12.5% • Dividend of €6.5 million to State in 2015

• Safety – Essence of the Corporate Mission

• 650 staff across 5 locations

IAA Overview

Key Roles of the IAA

Safety Regulation of Civil Aviation

Aviation Security

Regulation

Comms on North

Atlantic

Air Traffic Control at

State Airports

Air Navigation Services in

Irish Airspace

Safety within the IAA

Primary Corporate Objective First tick in the box for everything Compliance with all safety standards To International Standards Acts in the Public Interest

ICAO Safety Ranking* Top Ten European Countries

Country % of Effective Implementation

France 94.43% Ireland 94.04% UK (Europe) 93.63% Germany 89.83% Switzerland 89.08% Netherlands (Europe) 88.16%

Poland 87.57% Czech Republic 86.71% Italy 86.66% Belgium 85.82%

Comparison: Major States Worldwide

Country % of Effective Implementation

UAE 98.86% Canada 95.33% France 94.43% Ireland 94.04% UK (Europe) 93.63% USA 91.35% Germany 89.83% China 86.43% Brazil 85.75% Russia 83.02% Australia 82.67%

*ICAO Universal Safety Oversight - Continuous Monitoring Approach (CMA) Audit - January 2015

EASA / Eurocontrol 2014

86

0

10

20

30

40

50

60

70

80

90

100

Effectiveness of Safety Management (State Level) - 2014

Source: www.eurocontrol.int/prudata/dashboard/eur_view_2014.html

Governance & Management

Board

• Nine Members including Chairman

• Appointed by the Minister for Transport

• 7 Non Executive, 1 Executive and 1 Staff (expert skills & aviation)

• Board Objectives and Work Plan

• Various Board Committees – Audit – Finance and Planning – Personnel, Appointments and Remuneration – Investment Planning

Director Finance

Airworthiness

Flight Operations

Airspace Oversight

Aerodromes Oversight

Regulatory Performance and Licensing

Industrial Relations

Recruitment

Training & Development

Manpower Planning

ATM Technology

Training

Information Technology

ATM Safety Management

Director Safety Regulation

Director Human Resources

Director Commercial, Technology & Training

Director ATM Operations & Strategy

Internal Auditor*

Chief Executive

Air Traffic Control State Airports

Air Traffic Management Enroute service

North Atlantic Communications

Standards/ Procedures

Airspace

Company Secretary & Solicitor

Head of Corporate Affairs

Financial Control

Treasury & Funding

Customer Relations

Business Corporate Planning

International & Shareholder Relations

Public & Internal Communications

Strategic Projects

Quality Management

Property & Security

Environment

IAA Corporate Structure

*Reports to Audit Committee

Pensions Security Oversight

Board/Chairman

Commercial Contracts & Procurement

Business Continuity Planning

Airworthiness

Flight Operations

Airspace Oversight

Aerodromes Oversight

Regulatory Performance and Licensing

ATM Technology

ATM Training

ATM Safety Management

Director Safety Regulation

(Accountable Manager)

Human Resources

Director ATM Operations & Strategy

(Accountable Manager)

Chief Executive

Air Traffic Control State Airports

Air Traffic Management Enroute service

North Atlantic Communications

Standards/ Procedures

Airspace

IAA Safety Chain Structure

Board/Chairman

Quality Management

Corporate Services Legal

Finance

Shares held by State No interference in day-to-day operations Approvals required for very large CAPEX Inputs into Corporate Plan and other

strategic forward planning documentation from Shareholder

Adopt Public ‘procurement’ methods

Shareholder Relations

Safety Oversight

Airworthiness • 1,200 Aircraft on Irish Register • 727 Large Public Transport Aircraft /

434 Small Aircraft (includes amphibians, balloons, gliders, etc)

• 8 PART 147 Maintenance Engineer Training organisations

Flight Operations • 15 Airline/Commercial Operators • 8,500 Pilots (Commercial,

Airline, student & Private Pilots) • 1,500 Aircraft Maintenance

Engineers

Air Navigation Regulation • 338 Air Traffic Control Officers • 76 Radio Officers • 451,000 sq km airspace • ATC Radar and Comms Systems

Aerodromes & Airspace • 27 aerodromes licensed:

3 State Airports 11 other Public Licensed

Aerodromes 13 Private Licensed

Aerodromes

Oversight Scope

Irish Register – 1,200 Heavy Aircraft

Foreign Leased Aircraft

No# of Aircraft

Italy 125 Russia 116 Spain 14 Norway 2 Mexico 7 Mongolia 2

Irish AOC No# of Aircraft

318 48 27 17 14 9

Irish Airspace & Service Provision

North Atlantic delegated jointly to Ireland & UK by ICAO

Full Irish Radar Service

90% Traffic

Sample of IAA ATM Innovations

Founding member of COOPANS ATM

System

Point Merge (Arrivals

Management CDA system)

Partner in Aireon (Satellite based

ADS-B)

Remote Towers (SESAR Trial)

Joint IAA/ISAVIA Voice

Communications Control System

(VCCS)

Free Route Airspace (FRA)

since 2009

Business Performance & Charges

22

63%

12% 11% 10% 3% 1%

En route Terminal SafetyRegulation

North AtlanticComms

Commercial Other

Financial Performance 2014

EURO (m)

En route €112.1m

Terminal €21.1m

Safety Regulation €19.7m

North Atlantic Comms €18.4m

Commercial & Other €6.2m

Total Income €177.5m

Operating Expenses (€147.8m)

ROI (Operating profit) €29.7m

IAA Performance 2014

2013 Ranking Customer Share (ATM

Revenue) 1 British Airways 10.5% 2 United Airlines 9.3% 3 Aer Lingus 8.3% 4 Delta 8.2% 5 Air France/KLM/CityJet 7.7% 6 Ryanair 6.6% 7 Lufthansa 5.2% 8 American Airlines 4.7% 9 Virgin Atlantic 4.0%

10 Air Canada 3.6% 11 US Airways 2.8% 12 Swiss 1.6% 13 Thomson Airways 1.4% 14 Air Transat 1.2% 15 Aer Arann 1.0% 16 Federal Express 1.0% 17 Thomas Cook Airlines 1.0% 18 Turkish Airlines 0.9% 19 Alitalia 0.9% 20 Air Berlin 0.8%

MAIN CUSTOMERS

Conclusions

IAA Overall Experience • Clear delegation of Safety & Service Provision • No comprise on safety

Functional Separation

• Our decision • Our timescales

Investments / CapEx

• Highly suitable structure for Ireland Scale

•Re-invest profits to drive future efficiencies •Generate shareholder returns

Company orientated

• Flexible hiring policy Staffing

• Broad base • No risk of regulatory capture

Customers

Customer charges – En route 2005 – 2015 (€)

Benchmarking – En route

38.5039.75

40.9542.20

43.00

43.0044.10

45.00

45.00 45.00 45.00

30

40

50

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

North Atlantic Communications

120.06133.23

176.93

202.74

160.24

153.72156.92

156.92

0

50

100

150

200

250

2008 2009 2010 2011 2012 2013 2014 2015

Other Charges

Terminal Service Units

Other Charges

Safety Regulation

Charges Frozen since 2008

Marginal increase planned in Q4 2015

Aviation Security Charge

Currently Assessing Options

For introduction in 2016