Mr Randall—Thank you. With our original submission we included a copy of a response that we provided to the Hobart International Airport in relation to their major development plan. We really provided that for information, and we have put together a supplementary submission, which we will speak to today. It essentially tries to give the committee a benefit of our experience in dealing with that proposal and how that relates to the bill.

The council believes that its recent experience may provide a good working example to the committee of some of the perceived deficiencies in the way the Airports Act currently operates and the adequacy of the proposals outlined in the Airports Amendment Bill. It is noted that the council’s views are limited to amendments related to developments of a non-aeronautical nature. Also, the Hobart International Airport is not located in the city of Hobart municipal area but in a neighbouring area, and therefore our comments are in response to the impacts the development will have on our city and our metropolitan region. We have not dealt with issues such as rates equivalence and contributions to infrastructure in response to this inquiry, although we do support the submissions of the Council of Capital City Lord Mayors and the Australian Local Government Association.

In conclusion, Hobart City Council appreciates the fact that the government has undertaken a review of the Airports Act. The council trusts that the committee, in dealing with the Airports Amendment Bill will find the council’s comments useful. The council believes that there is a strong case for the act to strengthen the requirements for development proponents to make more and better information available to the community about proposals. In particular, proponents of non-aviation development should have a requirement to demonstrate whether they comply with the relevant local planning scheme or not. Further, there are a number of procedural issues that should be addressed to eliminate perceptions of bias, denial of natural justice and conflict of interest. In closing, we wish to support the position of the Council of Capital City Lord Mayors and the Australian Local Government Association in terms of the wider principles of and concerns for local government generally regarding non-aviation airport developments.

Our study looked at the municipal areas within greater Hobart and then it took Tasmania as a whole. It did not look at other areas—for example, Launceston. It certainly showed that the size of the development was big enough to impact on the entire retail offer in Tasmania. It was a small amount—I think it was three per cent across the state, but that is not bad for one development.

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Senator JOYCE—The development at Hobart airport?

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Mr Short—Correct.

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Senator JOYCE—My God! It is big.

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Mr Randall—There are 20 acres of retail.

Senator JOYCE—What is your main concern? Is it the draw of business away from Hobart—$100 million investment at the airport and its effect on the commercial precinct of Hobart. Is that the major concern?

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Mr Randall—That is our primary concern.

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Mr Short—And the fact that it is not subject to Tasmanian planning legislation.

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Senator JOYCE—I am just fleshing this out. That is what differentiates it from $100 million investment, say, in the north of Hobart—if a developer wanted to develop a $100 million shopping centre in some other area, wouldn’t that basically have the same concerns?

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Mr Randall—If it was not on the airport land, it would be considered under the Tasmanian legislation.

Mr Thomas—On behalf of Virgin Blue, I would like to thank the committee for the opportunity to address it and to further articulate our position in relation to the Airports Amendment Bill 2006. As outlined in our submission, Virgin Blue is broadly supportive of the bill but does have reservations regarding a couple of specific provisions contained within it. These primarily relate to the changes to the ACCC monitoring arrangements and the removal of the five per cent restriction on airline ownership of non-core regulated airports. In addition, since Virgin Blue made its submission we have identified an additional area of concern. This concern relates to item 16 and 23 of the bill which relate to non-aeronautical development on airport lands. Virgin Blue is concerned about the potential for such developments, whilst being within the parameters of an airport’s master plan, to impact on the further expansion of aeronautical infrastructure. Clearly, the primary focus for airports and airport operating companies should be aeronautical services. After all, that is why we have airports. Having said that, we do recognise that there is an obvious economic and social benefit from having non-aeronautical developments within airport precincts. What Virgin Blue wants to see is a sensible balance achieved between aeronautical and non-aeronautical development.

In conclusion, I reiterate that Virgin Blue broadly supports this bill but has some reservations, which I have outlined in our written submission and in my earlier remarks. I once again thank the committee for the opportunity to address it and I am happy to take questions.

Senator JOYCE—In your pricing do you have any concerns about association between the ownership of the airport and the ownership of the airlines and, if that association gets any closer, could it affect the pricing competition for you guys?

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Mr Hanlon—Absolutely. We have said that we do not agree with that vertical integration of an airport and an airline in having the same owners. We have said that in our submission and we certainly do not agree with that. That could happen if one airline and one major airport were owned by the same group. They could put the prices up knowing that the revenue stays within that group for that entity. Ultimately it impacts on Virgin Blue and Rex and the other smaller aviation carriers.