Regulatory Systems (Transport) Amendment Bill

Members, we now come to the debate on Part 6—clauses 40 to 47 and Schedule 5. This is the debate on amendments to other legislation. The question is that Part 6 stand part.

Just a brief comment on Part 6 in relation to Supplementary Order Paper (SOP) 17 as well, because the other change that is introduced through this SOP is a small but important one in terms of the recreational aviation sector. There’s been a longstanding bugbear in that sector that much of the aviation sector uses specialised jet fuel, but in the recreational aviation sector, there are some users, mainly of smaller planes and other aviation vehicles, who do use fuel that fuel excise duty is attached to. The complaint from that sector—which is a not unreasonable one, in my view—over the course of time has been that unlike for other sectors, there is no benefit that applies from that fuel excise duty to the sector.

So in the case of maritime, for example, maritime users who pay fuel excise duty do have the ability to see some of that duty come back in terms of maritime safety for things which are funded through the payment of that duty. We don’t have the same thing applying to the users of recreational aviation. This SOP makes a small amendment which, effectively, puts recreational aviation on the same footing so that the fuel excise duty that that sector pays will be able to be applied to purposes affecting recreational aviation, mainly in the safety space.

That has been a call from the sector. It seems like a fair and reasonable thing to do. It makes it consistent with other sectors as well. I’m sure—and I hope—that members across the committee will support that small change, and, once again, I’m very happy to take any questions on it.

Thank you, Mr Chair. To the Minister, through the Chair: some of the aviation sector—particularly the recreational users—have been very concerned that the fuel excise duty that is hypothecated for land transport has been used for purposes that they do not benefit from, so we appreciate that this change here goes some way towards addressing that.

However, they’ve also made the point in other submissions that through the civil aviation safety levies, they already pay a significant amount of money based on the type of aircraft and what they’re doing. For safety, they are trained to an extremely high standard, which is quite different from the recreational boatie, who can walk into a dealership and buy an $80,000 or a $120,000 boat on a three-axel trailer, take it down to the ramp, and use it with nothing more than a couple of life jackets. That’s all the qualification they need—it’s a chequebook.

The recreational aviation sector and the training sector, which includes flight schools, some of which use up to 200,000 litres of fuel a year—I understand that there’s one in Christchurch at that scale—are really concerned that they’ve been paying the fuel excise duty and receiving no benefits, and now this change, this amendment, will actually have them paying twice. So they’re certified, they’re audited by the Civil Aviation Authority (CAA), and they pay levies to CAA. They have beacons on board, and they are often responsible, as amateur or recreational pilots, for going and participating in search and rescue activities for lost boaties and others at their own cost.

So I would ask the Minister to explain how is this revenue collected from recreational and training and all of those motor gas fuel users who use that fuel in their aircraft—how is that different from the levies that are taken through civil aviation and applied to aviation safety? Thank you.

Just in response, as the member Simon Court’s question pertained to this particular part of this particular bill, I just think it’s important to clarify that there’s no additional payment requirement that is being created by this Supplementary Order Paper (SOP). What we are simply doing is saying that the estimated value of the payments that are made by the users of recreational aviation through fuel excise duty can be applied to activities that will benefit that sector.

It’s important to note that in the way that section 9 of the Land Transport Management Act is set up, we will only be able to provide benefits to that sector up to the estimated value that is paid in by the sector through fuel excise duty. So, in respect of this SOP and the way that this piece of legislation works, those are the bounds that we work in. My recollection is that the total estimated value is relatively small—it might be around about $500,000 per year. Under this change, myself, in consultation with the Minister of Finance and in consultation with the sector—which is probably quite an important point to note—will be able to ensure that the value up to the value of those levies received can be applied to the sector.

If there are broader questions around how other levies are used, levies that might be applied through the Civil Aviation Act and other pieces of legislation, they’re probably just things that we’ll have to pick up in another forum, but I’m open to a conversation with the member around them. This change is quite a specific one, and I think I’ve probably given an explanation of how that will be applied.

The question is that the Minister’s amendments to Part 6 set out on Supplementary Order Papers 16 and 17 be agreed to.

Amendments agreed to.

The question is that Part 6 as amended stand part.

Part 6 as amended agreed to.

Schedule 1