Avsec is funded through three main streams of revenue, as follows:

• A charge on international airlines based on a $15.00 (GST inclusive) charge per departing international passenger.  The same rate applies regardless of the costs incurred at a particular airport.  This charge does not apply to some of those screened: children under two years, air crew and transiting international passengers.   The charge is provided for under the Civil Aviation Charges Regulations and is effective from 13 December 2007.

 

• A charge on airlines based on a $4.66 (GST inclusive) charge per domestic passenger per sector flown on aircraft of 90 plus seats (effectively domestic operated jet aircraft).  The same rate applies regardless of the costs incurred at a particular airport.  This charge does not apply to some passengers screened: children under two years and air crew. Because of the set up at some airports it also means that Avsec screens passengers that fly on smaller aircraft for which it doesn’t receive payment.   The charge is provided for under the Civil Aviation Charges Regulations and is effective from 1 October 2005; and

• Specific charges for additional services provided on request, by foreign States or airlines or the Crown.  For airlines this generally done on an hourly rate basis. 

Avsec revenue in 2005/06 is projected to be $43.488m (GST exclusive) against the budget of $46.075m.

The domestic security charge was introduced on 1 April 2002.  Industry was consulted about the domestic security charge and supplied the limited information it had to assist in setting the charge.  However, lack of relevant data created uncertainties and so the charge was based on incremental costs resulting in the activity running at a loss. The level of the charge was reviewed in mid 2003 to assess if it was appropriate and there was not undue over- or under- recovery.  A further consultative process commenced in early 2004 with the submission of a proposal to amend the two passenger charges.  The parties agreed that the domestic passenger charge should be adjusted from 1 October 2005. It has been agreed with industry that a further review of the international charge will be carried out for the 2006/07 financial year.

After a number of years of strong growth in passenger numbers, in 2001/02 international passenger numbers declined primarily as a result of the events of 11 September and the accompanying US and Asian financial downturn.  In 2003 the combined impact of SARS and the Gulf War resulted in another drop in passenger numbers.  Relatively strong growth has occurred in the 2004/05 year and further strong growth is predicted for 2005/06 and out years (an average of 3.25% pa for the next three years).  Avsec remains confident that projected volumes will provide sufficient revenues for its security programmes.