1 Introduction

1.1 Purpose of Cost Recovery Implementation Statement

This Cost Recovery Implementation Statement (CRIS) provides information on how the Australian Maritime Safety Authority (AMSA) implements cost recovery for provision of infrastructure, regulation to support safe ship navigation in Australian waters, marine environmental protection, seafarer and ship safety, ship registration, and related marine services under the Navigation Act 2012 and Marine Safety (Domestic Commercial Vessel) National Law Act 2012. It contains financial estimates for 2020-21 and budget forecasts for 2021-22 and the three following years.

This document provides key information on the application of cost recovery activities, including financial and non-financial performance. It assists stakeholders to understand AMSA’s costs, which strengthens accountability, provides transparency, and demonstrates compliance with CRGs and the Regulatory Charging General Policy Order.

1.1 Description of the regulatory charging activity outputs

1.2.1 Policy background

AMSA’s policy outcome is to minimise the risk of shipping incidents and pollution in Australian waters through ship safety and marine environment protection regulation, and to maximise people saved from maritime and aviation incidents through search and rescue coordination[1]’.

1.2.2 Description of the activities

Regulatory charging activity outputs are summarised in Table 1, with the funding mechanism contained in brackets.

Table 1: Descriptions of AMSA’s regulatory charging activity outputs

Activity output	Description
Navigational infrastructure (Marine Navigation Levy)	Maintain a national network of integrated aids to navigation (AtoN) and traffic management measures in Australian waters[1] to ensure safe and efficient coastal navigation of the commercial shipping industry. This includes the provision of technical maintenance and engineering project management services. Other activities include shaping and ensuring appropriate international maritime standard setting at: International Maritime Organization (IMO), such as Australia’s obligations under International Convention for the Safety of Life at Sea (SOLAS), and International Association of marine aids to navigation and Lighthouse Authorities (IALA).
Environmental marine protection (Protection of the Sea Levy)	Resources the National Plan for Maritime Environmental Emergencies (National Plan), which is a cooperative arrangement between the Commonwealth, States and Northern Territory, and commercial shipping industry. The National Plan details processes about responses to pollution incidents including AMSA’s responsibility for: funding arrangements for clean-up operation costs relating to ship sourced pollution, and pollution that cannot be attributed to any specific vessel or cannot be wholly recovered from insurance providers. Other primary functions is funding the National Maritime Emergency Response Arrangements, as well as the maintenance of preparedness to combat pollution by ensuring there is adequate capability to respond to incidents through: training of personnel in response techniques, acquisition, maintenance, and stockpiling of relevant equipment and supplies at key sites around Australia, and provision of emergency towage capability.
Seafarer and ship safety under Navigation Act 2012 and other Acts (Regulatory Function Levy)	Conduct a range of maritime safety and regulatory activities on international and national commercial shipping operations. This consists of compliance inspections and audits undertaken on a risk based sample approach. A fundamental component of the activity is port State control inspections, which are inspections to ensure vessels and their owners or operators comply with regulations relating to vessels, crew, and the marine environment. Other inspections and audits include: flag State control inspections, marine surveys, cargo and handling related inspections, marine qualification duties and accreditations, and audits of registered training organisations. Promoting a culture of safety in the maritime industry through development of policies, guidelines, and technical requirements (Marine Orders) relating to legislative functions, is an integral component of the activity output. Seafarer and ship safety also includes the development of Australia’s maritime regulations and participation in international and regional maritime forums. It involves developing international standards on seafarer and ship safety and environmental protection, including harmonisation to international standards, mainly promulgated by the International Maritime Organization (IMO), International Labour Organization, and members of the Tokyo and Indian Ocean Memoranda of Understandings for port State control.
Marine services under Navigation Act 2012 and ship registration under Shipping Registration Act 1981 (fee-based activity detailed in AMSA Fee Determination)	Provides a range of fee-based activities: services to seafarers and coastal pilots (mainly qualifications), including approvals, issuing permits, authorisations, certifications, conducting examinations, and licensing for domestic and internationally recognised marine qualifications, inspections and surveys requested by ship owners (or agents), shipping registration of Australian flagged vessels, including ensuring vessels are maintained and crewed to a suitable standard, and other services, including determinations and exemptions.
Marine services under National System for domestic commercial vessels (fee-based activity as detailed in National System Regulations)	From 1 July 2018, AMSA transitioned to deliver safety services for domestic commercial vessels and seafarers, previously delivered by the States and Northern Territory agencies. As part of transitional funding arrangements, regulatory function based activities continue to be government funded, with fee-based activities cost recovered from industry. The fee-based activities provided are: certificates of operation, including assessment of application and issuing approvals for vessels to operate within certain defined areas and purposes, certificates of survey, including assessment of applications, and issuing approvals and certificates, to operate as a commercial vessel ensuring vessels comply with Australian law and standards, seafarer certificates of competency – near coastal, including approvals, assessing revalidations, issuing certifications, and conducting examinations for recognised marine qualifications, marine surveyor accreditation scheme to monitor and maintain competency of the network of accredited surveyors in the non-government sector, and assessment of applications requesting exemptions from standards and regulation of the National System or equivalent means of competency.

This CRIS does not cover:

Regulatory activities of the National System for domestic commercial vessels.A review of all costs and charges for the National System was to be conducted in 2020-21 and involve wide public consultation. In recognition of the significant impacts that the COVID-19 pandemic has had on Australia’s maritime industries, the Australian Government decided to delay this review. To ensure AMSA can continue delivering vital safety regulation to the domestic commercial sector the Australian Government announced on 6 October 2020 that it will provide an additional $11 million funding for 2021-22 while the review is being undertaken.

This new funding extends the Australian Government’s 2018 commitment that, no levy would be charged to industry for the first three years of AMSA’s delivery of National System services, by a further twelve months, meaning no levy will be charged to industry in 2021-22.

Total Government transition funding for the National System is now $123.4 million.
Commercial charges for the sale of publications (task, record, and logbooks), attachment licensing to third parties to use aids to navigation sites for specific purposes, and sub-leasing office and storage space.
Search and rescue coordination services for maritime and aviation incidents, which are funded by government budget appropriations[1],
Funding arrangements of shipping and offshore petroleum industries and the International Oil Pollution Compensation (IOPC) fund[2], and
Externally funded programs sponsored by various government departments for the provision of specific maritime related services.

1.2.3 Appropriateness of cost recovery

It is government policy that when an individual or organisation creates a demand for a government activity, there should generally be a charge for the provision of these activities.

Participants in the commercial shipping industry pay the costs attributable to the provision of navigational infrastructure within Australian waters, marine environmental protection, seafarer and ship safety, marine services under the Navigation Act 2012, ship registration, and some services under the National System for domestic commercial vessel safety.

Regulatory functions in many instances may be applicable across AMSA’s various activity outputs, such as emergency towage capability and work health and safety. Over time, a clearer demarcation of the costs to be borne by industry will be better understood.

Government policy is not to charge a levy for National System for domestic commercial vessel activities until the afore mentioned regulatory review is undertaken, assessing costs, funding options, and reducing administrative burden to industry.

Further, Government continues to funds search and rescue services attributable to community service obligations to the broader community through budget appropriations.

[2] Department of Infrastructure, Transport, Regional Development and Communication, Portfolio Budget Statement 2021-22, Budget Related Paper No. 1.10, page 199.

[3] AMSA does not provide navigational aids within port boundaries; these are the responsibility of port operators.

[4] The Government reaffirmed its initial policy, upon the establishment of AMSA in 1991, through the Strategic Review of Search and Rescue Service and pricing study in 2001 that search and rescue activities will remain funded from taxpayer funded budget appropriations.

[5] The Protection of the Sea (Oil Pollution Compensation Funds) Bill 1992 essentially established the procedure by which entities are required to provide details of oil receipts to the IOPC fund through AMSA - this is not a cost recovery arrangement.

1 Introduction