CHAPTER TWO

REPORT ON THE PRECISION AERIAL DELIVERY SYSTEM (PADS)

CHAPTER TWO

CHRONOLOGY OF EVENTS LEADING TO PURCHASE OF PADS

Introduction

2.1 Since the certification of PADS in 1988, SAR Pty Ltd has lobbied intensely and extensively to have the system adopted by search and rescue units throughout Australia.

2.2 In 1990, an incident occurred during which four people abandoned their yacht Rockin Robin which had been taking on water, boarded a dropped liferaft, and subsequently perished in seas which were too turbulent for the capacity of the liferaft. Debate ensued as to the efficacy of the methods used in the attempted rescue: Mr Laurie Gruzman of SAR Pty Ltd asserted that those lives could have been saved had a PADS system been used (a pump dropped to assist the stricken craft); but Airservices Australia disagreed, maintaining instead that there was no evidence to suggest that the yacht was in danger of sinking, or that PADS could have necessarily saved those lives.

2.3 Nevertheless, on direction from the then Minister for Transport and Shipping (the Hon Bob Collins), AMSA purchased in 1992 a number of PADS units both for training and for delivery of petrol driven pumps to stricken vessels, and relegated them to CAA for storage, maintenance and delivery (they were subsequently inherited by ASA). However, according to Airservices Australia, there were problems with training and some serious safety and OH&S flaws became evident. [1] This led CAA to suspend their use [2] and to choose an alternative system for delivering liferafts as its standard. [3] The pump units were, however, retained.

2.4 In late 1993, a joint review of air-delivered rescue equipment was carried out by an independent panel under the auspices of the CAA, the Department of Defence and AMSA. [4] The Joint Review received some 56 submissions and conducted a program of inspections and visits. [5] In its consideration of PADS, the report noted:

Prior to and during the time of this review, a ban on the system has been applied by the Staff Association [Civilair] because of concerns about the static line. Negotiations between the CAA and the Association led to CAA undertaking a research program to attempt to resolve these concerns. Negotiations were not complete at the time of preparation of this report. Solutions will require discussions with other parties and the issue is inappropriate for further exploration in this report. [6]

2.5 With regard to PADS, the Joint report made the single conclusion that: 'The Team regards the PADS system as suitable for delivery of pump units'. [7]

2.6 In the meanwhile, Mr Gruzman continued to lobby government ministers and instrumentalities as to the efficacy of PADS. Throughout 1993 and 1994 he repeatedly wrote to CAA requesting that a tender be called to determine the best system for Australia. However, CAA held firm in its belief that its own system was superior to PADS and that there was no necessity for CAA to call for tenders to replace that system. [8] This belief was incrementally reinforced by a series of incidents involving PADS that had occurred during 'pump-drop' training, not least of which was an accident late in 1993 when an officer was injured. [9] Despite these incidents, correspondence throughout 1994 provides evidence that CAA made repeated attempts to resolve the problems encountered with PADS during training so that the pump equipment could be put into general use.

2.7 Finally, however, after persistent lobbying from Mr Gruzman, the then Chairman of CAA, General Gration, agreed in 1994 to conduct an open, world-wide tender for an aerial delivery system. The resultant project was named SAREDS (the SAR Equipment Delivery Systems Project).

The SAREDS Project

Phase #1 - Letting of Tenders

2.8 The SAREDS Project commenced in August 1994 and under it a Tender Evaluation Committee (TEC) was appointed. The tendering process itself was subcontracted to Purchasing Australia (Department of Administrative Services). Three tenders were submitted but only one was considered to be suitable for comparative testing: the Precision Aerial Delivery System (PADS) manufactured by Search and Rescue Pty Ltd (SAR Pty Ltd). [10] Assessment of the tender against the system currently in use was contracted to the RAAF Aircraft Research and Development Unit (ARDU).

2.9 In evidence to the Committee, Mr Gruzman of SAR Pty Ltd, was highly critical of the tendering process:

They [Airservices Australia] classified it as a major project and it took two years. During that time they were still using their system. After two years, it was advertised worldwide. I believe there were 150 or so inquiries, but only one conforming tender resulted , that was ours [SAR Pty Ltd] , from the whole world. [11]

Phase # 2 - RAAF ARDU Testing

2.10 The ARDU tests were carried out between 21 August and 1 September 1995 at Edinburgh (South Australia) using the existing Airservices rescue system as a benchmark (the single, twin and multiple stored systems). The PADS system was tested in three configurations: one releasing a single liferaft, the second releasing a water pump and the third releasing a storpedo. All sorties were accompanied by a chase aircraft which provided photographic records of all releases (high speed cine film). A total of 28 flights were undertaken (14 each in PA-31 and Cessna 210 aircraft) over a total of 31 hours (15.5 each). [12]

2.11 The ARDU scrutinised the two systems in terms of maintenance, protection to SAR equipment, safety, reliability, flexibility, training and environmental considerations. Dropping tests were carried out in both light and heavy weather conditions (a sea swell of up to two metres and winds up to 30 knots), [13] although severe weather conditions were not encountered. [14] Ground tests were also carried out in which loading and handling, fit of systems in the aircraft, ease of preparation for use, and safety of storage were investigated. [15] Training for pilots and dropmasters in PADS deployment was carried out at SAR Pty Ltd headquarters at Merimbula (NSW). [16]

2.12 While five releases of the PADS system had been planned, complications with the first release led to the suspension of any further PADS testing. The Airservices equipment, however, was subject to the full testing protocol.

2.13 The test results were issued in November 1995 by the ARDU in a publication entitled Report for Task #0207. In addition to the written report, videos copies of high speed cine camera footage of each of the drops and other trials were provided to Airservices Australia.

2.14 The ARDU Report concluded that there were two 'unacceptable' features of the PADS system and eight 'unsatisfactory' features. The two unacceptable features were: the oscillatory motion of the static line resulting in the drogue impacting on the aircraft control surface; and the risk of uncommanded inflation of the liferaft while in the aircraft. Because these unacceptable features ultimately posed a risk to the safety of the aircraft's crew, it was recommended that both faults needed to be addressed prior to undertaking any further testing. [17]

2.15 The 'unsatisfactory' features were: release altitude (100'); circuit procedures for dropping; weak link design; fit of life rafts in the canister; ease of handling; retrievability of pump; instructions for assembly of pump; and ground and flying training. [18]

2.16 With regard to the Airservices Australia systems tested, the report noted that although they were acceptable overall, three unsatisfactory faults were found which needed to be addressed: consistency of accuracy, drift of the trailing cone to one side of the aircraft; and tangling of ropes. [19]

2.17 In an independent critique of the ARDU report made by Air Marshal David Evans, Captain Humphrey Bell and Mr Brian Versace, dated 28 February 1996, comments were made on various aspects of the test findings. [20] The report agreed that problems encountered with gyration of the static line, premature release of the canister, and uncommanded inflation of the liferaft within the aircraft were of significance.

2.18 However, the report also made a number of criticisms of the RAAF flight test procedures. In particular, the authors questioned the fact that the RAAF pilots had encountered difficulty with flying at the height required by the 'Gruzman Circuit' (100 feet), commenting: 'We would have thought this to be a routine operational procedure for many tactical missions'. [21] That section of the report concluded that flying problems encountered were more likely to have been due to inadequate training than any inherent problem with the delivery system.

2.19 SAR Pty Ltd was also critical of the ARDU tests on a number of grounds. In particular, Mr Gruzman argued that the equipment failures were due to human error, not any inherent problems with the PADS system. In evidence to the Committee, Mr Gruzman stated:

… let us take what else happened on this one and only flight. The flight took, we will say, six minutes. Let us look at what went wrong. First of all, the aeroplane gets out of control [which Mr Gruzman claimed was pilot error]. Next, when they drop, the canister is like this, and inside here is a rope that goes to the pin. Obviously if there is a heavy object inside it, which there is, and you roll it, it can displace that rope, and if it does, in those days that would pull the pin,that is obvious.

We were not allowed to watch the loading of the aeroplane or any aspect of it, although we had four men there. Therefore, it was reasonable to suppose that the unit had been rolled. Anyway, whatever the reason, it released prematurely so that the static line was left out of the aeroplane. All you had to do was pull it in, but these men said that they made a mistake, that they thought that they had to leave it out for eight second … even though it was serving no useful purpose.

It, having been left out, started to gyrate. The instructions are that if anything like that occurs you immediately cut away. Mr Boag, who knew something about PADS, was in the right seat, and you had dropmasters. We had trained them but they had refused to undergo cutaway training, but they had certainly had it well and truly explained to them. One man was sitting there with a knife and the cut-away mechanism but somehow or other they did not bother to use it and so they pulled the gyrating cone in under the tail. It was inevitable that the cone would hit the tail. [22]

Phase # 3 - TEC Report

2.20 In January 1996, the Technical Evaluation Committee of SAREDS published its own report, Tender Evaluation Plan Phase #3, which was a consideration of the evaluation conducted by the ARDU.

2.21 In assessing the various systems, the ARDU had scored each aspect of each system. However, in considering the ARDU report, the TEC decided to 'adjust' the actual scores. This was done in order 'to represent the views of the TEC in total and draw on the collective experience and knowledge of both ARDU and non-ARDU members of the TEC'. [23] The net effect of the modification was to reduce the overall scores for the Airservices system and to increase the scores attributable to the PADS system, although, according to the TEC, 'the agreed modification did not affect the outcome of the Evaluation process'. [24]

2.22 In its report, the TEC also noted that when compared with approved drawings, the static line of PADS had been modified. The TEC considered that these modifications indicated:

poor configuration management;
inconsistency of manufacture;
deliberate unauthorised product modification. [25]

2.23 The TEC concluded in its Phase #3 Report that two recommendations should be presented to the Airservices Australia Board for consideration:

1. Airservices should make no purchases of delivery systems as a result of the SAREDS Project; and

2. Airservices should initiate a research and development action to try to eliminate the deficiencies with Airservices existing delivery systems which were identified by ARDU during Phase #2 flight trials of the project. [26]

2.24 Thus PADS failed to win the tender. As noted by Purchasing Australia in a letter informing Mr Gruzman of the result: 'Airservices Australia considers that no system offered exceeded the capability of their current equipment and therefore they have elected not to procure any new equipment types as a result of the Request for Tender'. [27] Airservices subsequently withdrew the existing stocks of PADS equipment from its inventory. The total cost of the SAREDS project was $299,633. [28]

Turtleair Report

2.25 During the tendering phase of the SAREDS project it became apparent that there were no standards which applied to the construction of search and rescue equipment or its dispatch from an aircraft. Prompted by concerns expressed by the SAREDS Project Manager, Mr John Swann, CAA commissioned the aviation company Turtleair Pty Ltd, in conjunction with Multitech Aircraft Services Pty Ltd, to conduct an independent review of its search and rescue delivery systems and procedures. The resulting report, which was issued in May 1995, made a considerable number of recommendations on airworthiness and flying operations, some of which it rated urgent. [29] Its major finding was that all equipment used in the delivery of stores be required to meet a standard for acceptance as approved equipment in terms of search and rescue operations.

2.26 However, having commissioned the report, action within CAA then stalled. As described by Mr Swann in evidence to the Committee:

We did not have the manpower to do a lot with it. I knew there were problems. I figured it was a worthwhile risk as far as the [SAREDS] tender was concerned. What concerned me was that somebody would ask for the information, but nobody did. We did not really have an option of slowing the project down. We also did not have the time to do the Turtle Air stuff before the project. [30]

2.27 Eventually though, the recommendations that came under the ambit of the newly created Airservices Australia were put into effect. [31] However, despite efforts by Airservices, those recommendations which needed action by CASA, were not, and still have not been dealt with by CASA, [32] although the Commmittee notes that CASA recently gave an undertaking to a Senate Estimates Committee to do so. [33]

Airservices Position - April 1996

2.28 In April 1996, Airservices Australia provided a three-page briefing to the incoming Minister for Transport and Regional Development, the Hon John Sharp, on the involvement of Mr Laurence Gruzman in search and rescue. In that briefing paper Airservices Australia stated in relation to the SAREDS Project, and to PADS in particular:

the tender evaluation process was fair and proper and is now closed;
PADS failed to win the tender on the grounds of safety, occupational health, economics, and performance;
Airservices' experience with PADS has involved serious incidents, such that both management and staff are unwilling to use it;
Airservices has removed PADS from its inventory; … [34]

2.29 Thus, in April 1996 the position held by Airservices Australia management was clear: PADS was an inferior system to that currently in use.

Media Exposure - June 1996

2.30 Some two months later, on Sunday 9 June 1996, the television program 60 Minutes aired a segment entitled Wing and a prayer: search and rescue service in disarray. At its commencement the program asserted that Australia's search and rescue system was 'in disarray with different agencies working at cross-purposes', and that 'through pig-headedness, Canberra's bureaucrats have for years been turning their backs on a system that is not only cheap but clearly superior'. [35] Throughout the remainder of the program compere Jeff McMullen was severely critical of the existing Airservices system and extensively praised PADS.

2.31 In particular, the program significantly down-played the safety problems encountered during the ARDU testing. As stated by McMullen:

Last year when tenders were being finalised, PADS was eliminated on a dubious technical foul. As this footage shows, a light plastic cone, part of the PADS dropping gear, touched the tail of the plane. For this, PADS was struck out. [36]

2.32 And, after dismissing all previous safety concerns about the operation of PADS, with the assistance of SAR Pty Ltd, 60 Minutes subjected the system to 'a two-day trial' of its own 'with … cameras rolling'. The results of this test, according to McMullen, were that 'time and again … it worked with impressive accuracy'. [37]

2.33 Later, however, Aerospace Technical Services subjected the 60 Minutes tape to detailed scrutiny and concluded that some technical problems did in fact occur during those trials; problems which may not have been noticed because the media was focused solely on the accuracy of deployment. In evidence to the Committee, ATS argued that critical appraisal of the video tape and sound recordings of the 60 Minutes drops revealed several incidents where there was a forced release of the PADS canister. [38] In addition to the evidence noted by ATS, an Airservices internal memo described an incident that occurred during the 60 Minutes tests when Airservices officers noticed SAR Pty Ltd staff examining a cutting link that had apparently broken during one of the drops. [39]

Ministerial Involvement - May/June 1996

2.34 On 9 May 1996 the Chief Executive of SAR Pty Ltd, Mr Laurence Gruzman, met with the Minister for Transport and Regional Development, The Hon Mr John Sharp, and his Senior Adviser, Mr John Wallis, in Parliament House. According to the Minister, Mr Gruzman explained and demonstrated the equipment to him at that meeting. Mr Wallis was also present at a demonstration of the equipment by Mr Gruzman on Lake Burley Griffin on 11 June 1996.

2.35 Following the 60 Minutes program, the Minister announced through a brief Media Statement that new testing would be carried out on different varieties of search and rescue equipment. The Statement acknowledged that the Minister's decision followed the criticisms aired on television on 9 June 1996.

2.36 The Media Statement noted that the trial would be carried out 'by the new Search and Rescue organisation that Pat Crone is reporting upon in July', but that 'if the new organisation [was] unable to complete the task within a reasonable time, then the testing [would] be transferred to Airservices Australia and be verified by an independent expert …'. It concluded that 'a final decision will be made after the test, settling the matter once and for all'. [40]

2.37 The Minister's action, however, in issuing this statement, failed to take account of the brief that had been provided to him by Airservices Australia two months previously which had clearly stated that the PADS equipment had a history of problems.

Airservices Board Action - July / August 1996

2.38 In July 1996, following the resignation of Mr John Pascoe as Chairman of the Airservices Board, a new Chairman, Mr John Forsyth, was appointed. Although chairman of the Dymocks Book Arcade group of companies, and having had experience on the Board of a number of other commercial enterprises, [41] Mr Forsyth had had no previous experience as the Chairman of a government authority. Having inherited what had by then become a media enhanced controversy, the new Chairman was keen to see a speedy resolution to the matter.

2.39 In evidence to the Committee, Mr Forsyth justified his precipitate actions as follows:

The decision to evaluate the PAD system was based on the following: to finalise the debate as to which was the best system, and to regain public confidence in a system. The board believed that Airservices must be in the best position to rescue people and there had been much media debate and criticism of Airservices' search and rescue equipment and abilities.

The debate on whether Australia should be using the PAD system had been going on for more than eight years with no resolution. An independent, fair and unbiased evaluation was needed in which all the participants were satisfied with the ground rules and they would accept the results. Because of the antipathy between Gruzman and some Airservices staff, fuelled by Gruzman's allegation of foul play, it was obvious that unless a fresh person took the lead role the problem was unlikely ever to be resolved. There had been a long history of trials that were not followed up and a long history of indecision. This, coupled with personal accusations by Gruzman against Airservices Australia, prevented a way forward.

I arrived on the scene with no allegiance to either system, and therefore I was well placed to progress the matter. [42]

2.40 On 4 August 1996, Mr Forsyth wrote to the Minister outlining his concerns that 'should a search a rescue require the use of the Airservices equipment, at best it would be inefficient and at worst it would fail'. [43] Further, he argued that: 'should a search and rescue fail or lack efficiency, it would not be possible to withstand the resulting criticism and media barrage' which, in his opinion, 'would be well deserved'. [44]

2.41 In addition, the letter stated that the Chairman believed that the explanation he had received from Airservices Australia itself did not 'stand up to scrutiny' and that there was 'no sense of urgency' in Airservices management to resolve the matter. [45] In other words, he did not have confidence in the position held by Airservices personnel. In fact he was severely critical of Airservices for, in his opinion, 'years of indecision and buck-passing'. [46]

2.42 When questioned by the Committee about his statement that the briefing received from Airservices Australia did not 'stand up to scrutiny', Mr Forsyth replied: 'Some time has passed since then and I cannot immediately recall the exact items that would have caused me to do that, but my main concern was a commonsense concern'. Later he also stated: 'In my view, the briefing … did not satisfy me'. [47]

2.43 As a solution to the 'years of indecision', Mr Forsyth suggested that the Minister: 'consider making an announcement that you have appointed me to arrange the fly off as a matter of urgency' to determine the preferred system. [48]

2.44 This request to the Minister, however, ignored the fact that although there had been many iterations of PADS, problems with its deployment (and in particular the abberant behaviour of the static line) had not been overcome. In addition, while claiming that there had been 'years of indecision', the Chairman's statement ignored the fact that there had been a number of relatively recent reports, the most recent being the SAREDS project conducted by Airservices Australia itself, all of which had firmly rejected PADS. In evidence to the Committee the Chairman acknowledged that he had not read any of these reports. He had done this deliberately so that he 'did not form a particular opinion', [49] and although he had watched the 60 Minutes program he had not taken much interest in it. [50]

2.45 While the Chairman himself used the term 'fly-off' in his letter to the Minister, he later, in evidence to the Committee, stated his objection to the use of the term: 'Shortly after we started the negotiations with Mr Gruzman, I tried to get rid of the connotation that it was a competitive fly-off by emphasising that it was a technical evaluation. In this regard I was largely successful with Airservices staff but I could not eradicate 'fly-off' from Mr Gruzman's vocabulary'. [51]

2.46 The reply to the Chairman's letter came not from the Minister, but from his Senior Adviser, Mr John Wallis, who had been requested by the Minister to respond. The reply stated that the Minister requested Airservices Australia to commence a 'fly-off' as soon as possible. The letter also noted: 'there has already been considerable preliminary inquiries made by the Department of Transport and Regional Development regarding the manner in which such a fly-off can be conducted' and that the First Assistant Secretary of the Aviation Policy Division, Mr Peter Harris, 'has already had extensive discussions with Mr Gruzman on the matter'. [52]

2.47 When questioned about these matters at a hearing of the Rural and Regional Affairs and Transport Estimates Committee, Mr Harris explained:

The background to the department's involvement - to my involvement in particular - in this area relates initially to a press release that the minister put out on a decision he took … to undertake a review of search and rescue arrangements per se across both AMSA and Airservices.

A review was put in place … particularly in mind, although not a fait accompli, was the idea that we should have a single search and rescue organisation in Australia rather than some miscoordination between the different agencies which have a responsibility in this area.

…

So by dint of being involved in search and rescue per se and the Crone review, we were also involved in the question of the new organisation taking up the assessment of PADS. … It was effectively my job … to communicate that to Airservices and to discuss how these things might take place if, indeed, a new organisation was not up and running within a reasonable time.

Subsequent to that, Mr Gruzman contacted me and put the proposition that he had every expectation that this testing of PADS equipment would take place within a very short time frame. [53]

2.48 At the 6/7 August 1996 meeting of the Board of Airservices Australia, under Item 5, the Chief Executive's Report, the Board discussed issues relating to search and rescue. During that discussion the Chairman himself raised the subject of the purchase of PADS equipment. [54] As a consequence, the Board formally authorised expenditure of up to $1 million on the purchase of alternative equipment for marine rescue, the Precision Aerial Delivery System (PADS), manufactured by Search and Rescue Australia Pty Ltd (SAR Pty Ltd), if that system was found to be superior to those systems currently being used. [55]

2.49 Then followed protracted negotiations between Airservices Australia and SAR Pty Ltd as to the manner in which the 'fly-off' would be conducted. According to the Chairman:

… one of the criticisms from Mr Gruzman and the Airservices staff was that the ground rules kept changing. To counter this potential problem, I negotiated a letter of agreement with Mr Gruzman and Airservices Australia staff which took six days of quite excruciating and quite extraordinary negotiation to achieve and finalise. I have been in business for a long time and I have never had a negotiation like it. [56]

2.50 On 12 August 1996, Airservices and SAR Pty Ltd entered into the agreement for an evaluation of the PADS equipment, commencing on 19 August and concluding on or about 24 August 1996. The independent Evaluation Panel appointed under the contract was to provide a written report within 30 days of the evaluation, and include a recommendation as to whether any new equipment should be purchased. [57]

2.51 The contract stipulated that:

… if Airservices' equipment is found to be superior to the SAR Pty Ltd equipment, then its continued use will be confirmed. If SAR Pty Ltd equipment is found to be significantly superior to the existing Airservices' equipment and any equipment offered by a third party, then Airservices will enter into negotiations to purchase not less than 100 PADS units. If SAR Pty Ltd's equipment is found to be marginally superior, the cost of purchasing its equipment will be a factor for the Evaluation Panel to consider when making its purchase recommendation. [58]

2.52 Included in the contract was the unusual condition that:

… in the event that the Evaluation Panel does not recommend purchasing the SAR Pty Ltd equipment, SAR Pty Ltd agrees that it will make no further submission to the Australian Government or its agencies (either directly or indirectly) nor will it apply further direct or indirect pressure on the Australian Government or its agencies in respect of its equipment for a period of at least five years. [59]

2.53 When questioned in evidence to the Committee about this part of the contract, there was some initial confusion as to whether Counsel for Airservices Australia, Miss Kim Morison, had seen it. Having later agreed that she had read the clause before the letter was sent to Mr Gruzman, Miss Morison acknowledged that the condition would be difficult if not impossible to enforce legally. In defending his request to have the clause inserted, the Chairman, stated:

I took the view that Mr Gruzman had been attempting to sell these units for in excess of eight years and had been very aggressive and very persistent in his attempts to sell them. I had become personally aware of what pressure Mr Gruzman was prepared to apply and I also knew that the evaluation was going to cost somewhere in the order of $150,000 to $200,000. I was not prepared to proceed unless there was a mechanism,enforceable or not,clearly expressing intent. I was not prepared to have Mr Gruzman lose this evaluation and come back, two months later, with a model F and ask for a new evaluation and apply the very same pressure. Again, I come back to my contention that it is taxpayers' money that is being spent and I believe that the allegiance should be to the taxpayer and not to the contractor. [60]

2.54 On 14 August 1996 the Evaluation Panel was formally appointed, after consultation and agreement with SAR Pty Ltd as to its composition, to assess the latest, 'E' version of PADS. The panel comprised Mr Frank Young (Chairman), Mr Alf Tremain, Mr Alan Terrell (until 21 August 1996) and Mr Peter Patroni (from 21 August 1996).

2.55 It should be noted that neither the motion passed by the Board at its August meeting, nor the procedures used by the Evaluation Panel included a tendering process of any sort to determine the search and rescue systems to be evaluated.

Certification by CASA

2.56 There are three legal requirements that PADS equipment must fulfil when dropped from an aircraft. First, as with any cargo, while being carried in the aircraft it must itself not be dangerous nor carry any hazardous components. Second, when it is dropped from the aircraft the circumstances under which it is dispatched must comply with Civil Aviation Order - Section 29.5. This order states, at Paragraph 4.2: 'The opening through which articles or substances are dropped shall be located so that the articles or substances, on release, will not damage or effect the operation of any part of the aircraft'. In order to comply with CAO29.5, CASA requires trials to be conducted under the control of a qualified person and in accordance with an agreed flight test schedule. CASA officers may witness these trials and on satisfactory completion CASA, or a delegate, may issue a flight manual supplement for specific aircraft to permit the dropping of PADS equipment.

2.57 Third, while PADS itself does not need to be certificated, because it is not an aircraft component, the static line, which remains attached to the aircraft after the canister is dropped, must be certificated under Civil Aviation Regulation (CAR) 149. Certification must be issued for each type of aircraft used and each time modifications are made to the line. The line can only be manufactured by approved organisations and are subject to batch testing. Certification of the 'E' version static line was carried out by a CAR35 engineer in January 1996 for SAR Pty Ltd. [61]

2.58 While search and rescue crews are trained in accordance with the full set of Regulations and Orders, [62] neither a rating nor an endorsement is required to engage in search and rescue operations. The pilot, however, should have as a minimum, a private pilot's licence which is not subject to any distance restrictions. [63]

2.59 Just prior to the appointment of the Evaluation Panel, the Chairman became concerned about the issue of certification of search and rescue equipment. In a letter to the Chairman of CASA (Mr Justice Fisher), Mr Forsyth expressed the view that both the current search and rescue system being used by Airservices and the proposed PADS system should be certified by CASA to ensure that they met required safety standards. The letter noted that despite the fact that CASA had already provided advice that 'the equipment and procedures may not need to be certified', Airservices Australia believed that it 'was in the public interest' to do so. [64]

2.60 As a reply to this letter had not been received by 14 August 1996, Mr Forsyth again wrote to CASA suggesting that: 'if it is not possible to provide written approval from CASA for either or both of the systems prior to commencement of the evaluation then I invite one or more of your Senior Managers to attend to observe the evaluation. It is essential that at the conclusion of the evaluation, CASA confirms whether or not the equipment and procedures meet the required safety standards for search and rescue operations'. [65]

2.61 In his reply of 15 August, Justice Fisher repeated his earlier advice that under existing Civil Aviation Regulations (CARs), CASA did not have any statutory power to approve or certify equipment used in search and rescue operations as such equipment was not an aircraft component but he offered for an officer to attend the August evaluation to determine whether approval under CAR 149 was required. [66]

Independent Evaluation Panel - August 1996

2.62 The Evaluation Panel appointed by Airservices Australia was required to develop its own terms of reference and criteria for the comparative evaluation of the PADS system. In doing this the Chairman of the Panel, Mr Frank Young, stated: '… we saw our evaluation to be more of a practical nature, taking into account how the system was trained for, from both a pilot and dropmaster point of view and its ability to effectively deliver equipment to people in distress'. [67]

2.63 The evaluation of the effectiveness of the two systems was based on the time taken to deliver the rescue equipment and the accuracy and reliability of each delivery system. The safety features of each system were also taken into account, both in respect of those delivering and those receiving the equipment. [68] In order to provide a numerical basis for evaluating the effectiveness of the two types of delivery systems, the Panel, in consultation with SAR Pty Ltd, devised a point scoring system. [69]

2.64 The time-frame set by the Board for the 'fly-off' was tight. The Panel was given five days to arrange the tests and 5-7 days to have them carried out. It then had 30 days to report. While suiting SAR Pty Ltd and Airservices Australia, the compact time-frame precluded the participation of a third possible contender - RFD Pty Ltd. In a letter from the Victorian manager of RFD it was stated:

… With regard to our participation, I confirm that we are unable to supply a unit in time for the trials on 21-22 August. Although the system is available ex stock RFD North Ireland, we do not have the time to airfreight to Australia to meet the fly-off dates. Other factors which concerned me greatly was that RFD would most probably have to meet all costs associated with the evaluation, that is, aircraft, pilot, dropmaster, et cetera, with no guarantee that our system could be purchased even if the kit was considered superior. If the circumstances allowed us to submit the heliraft 7R SAR kit for evaluation, we would most certainly have participated. [70]

2.65 The very short time frame also precluded testing of the two systems in the type of weather usually encountered when marine search and rescue is called for - high seas, wind squalls and poor visibility. According to the Chairman of the Panel, the fly-off team actually went looking for those sort of conditions in Bass Strait but could not find any and owing to time constraints, could not wait for it to happen. [71]

2.66 Lack of time also, it appears, led to the failure of the Panel to independently check the modifications made to the PADS unit by Mr Gruzman, which had been carried out after the ARDU tests. Instead, the Panel accepted Mr Gruzman's assurance that the necessary changes had been made. When questioned in evidence about those changes, Evaluation Panel member Mr Alf Tremain responded:

I can go through some of the issues. Naturally, we are aware of the RAAF report and, naturally, we address those concerns. The first one was the oscillatory motion of the static line which happened on one occasion. The reason that was given to us was that there was an additional shackle at the end of that static line that made it unstable. The static line used in the ARDU test did not, in fact, conform with what had been air tested by the CAR 35 engineer. We were assured that proper approved static lines were used and we saw that as no longer an issue. [72]

2.67 When asked about the risk of uncommanded inflation of the liferaft inside the aircraft, Mr Tremain replied:

… Mr Gruzman advised us that he had conducted tests to see if it were reasonable for a raft to inflate in the container. From the tests that he described to us we considered it an extremely remote possibility. We did not view it as seriously as the RAAF had. [73]

2.68 However, later in evidence it was revealed by Mr Tremain that the test conducted by Mr Gruzman had consisted of placing the PADS cannister in the back of a utility truck and driving down a rough dirt road:

[Mr Gruzman conducted what] … I would call an engineering type test. What he did, he put a PADS unit on the back of a truck. He drove it over rough ground to try and dislodge the raft, or make the raft move around inside the PADS unit to try and entangle the inflation line. [74]

2.69 The Committee notes, however, that the question of how much time the Evaluation Panel had at their disposal varied according to whose opinion the Committee sought. When asked why there was such haste, Mr Young replied: 'We were asked to conduct the evaluation in a certain time scale'. When asked what was critcal about the chosen dates, Mr Bill Pollard, Airservices CEO replied: ' … the board … wanted to have the evaluation conducted as quickly as possible'. [75] Yet the Chairman of Airservices Australia, when asked about the time restrictions placed on the Evaluation Panel, commented: '… there was no restriction. If he [Mr Young] had said 10 days or 22 days, I would have agreed'. While it is clear that a more thorough evaluation would have been carried out given more time, the Committee notes that at no time did the Panel request an extension.

2.70 More time was requested, however, by instructional pilot, Mr Neil Boag. In a letter to Airservices SAR Manager, Mr Tony Marshall, he stated that the time allowed had not been sufficient to train the three nominated pilots in Airservices aerial dropping procedures to the required standard and that he was not prepared to approve them unless more time was allocated. This request was approved. [76]

2.71 The flight tests of PADS were conducted at Merimbula between 19-23 August 1996. Six sorties were flown, three for each system. Three pilots were selected who had sound general flying experience but no previous experience in air dropping techniques. They were trained in the dropping of both systems and each pilot flew an equal number of sorties on each type of equipment. The total test flying time logged for the three pilots over the three days was 20.2 hours. [77] Representatives from CASA, including a Flying Operations Inspector and an Airworthiness Officer, were present at the trails for several days during 19/23 August 1996. [78]

2.72 The results of the dropping trials can be summarised as follows.

The PADS system was clearly superior of in terms of accuracy and effective use by survivors.
Both systems revealed straddle errors.
The aiming procedure for the twin and multidrop Airservices system was considered to be 'seriously flawed' as it ignored target drift, or assumed that drift would be exactly downwind.
The PADS system was superior in terms of speed of deployment (ie. from time of arrival of the aircraft over the target to time of live drop).
While the PADS system required skilful control and mature judgement by the pilot at heights as low as 100 feet, the Airservices system required far greater pilot/dropmaster coordination to determine release points for pyrotechnics and time to establish the aircraft in the drop pattern.
PADS equipment failed in two instances when, on both occasions, the raft failed to automatically inflate.
While training of pilots, dropmasters and dispatchers in the PADS system was simpler and faster than with the Airservices system, training in the preparation and rigging of PADS equipment was more complicated. [79]

2.73 In terms of safety, the report noted that while in excess of 200 items of equipment were dropped, 'at no time during the evaluation was there any known breach of safety or any reported unserviceability to any aircraft involved'. [80] However, as documented below, this was not the view of several of Airservices staff who were present during the testing.

2.74 On 24 August 1996, the Chairman of the Evaluation Panel provided to the Chairman of Airservices Australia a letter stating that the evaluation had been conducted in accordance with the conditions stipulated in the agreement and that a detailed report, including a video record of the flying operations involved, would be provided as soon as it had been completed. Most importantly, however, the letter presented the summary finding of the Panel:

… that the SAR Pty Ltd equipment delivery system is significantly superior to the systems currently utilised by Airservices Australia. [81]

2.75 The Panel's detailed report was presented to Airservices Australia on 12 September 1996. The cost of the evaluation was 'a little over $150,000'. [82]

2.76 Criticism of the process used by the Evaluation Panel and results of the tests came from several Airservices Australia personnel. Mr Tony Metcalf commented, inter alia, in his report to the Chairman: 'Airservices dropped 10 rafts and all inflated. SAR P/L dropped 9 rafts which resulted in two failures' [83] His conclusion, however, stated:

As the manager representing Airservices Australia I accept the organisation of evaluation conducted between 19-23 August.

Ther are no complaints levied against the evaluation panel, and this group has been most professional and fair. I extend my congratulations to them for the manner in which they have performed this most difficult task under trying conditions'. [84]

2.77 The Acting Manager of Airservices SAR, Mr Tony Marshall, provided lengthy comment on the Evaluation Panel report in a letter to Mr Peter Evans, General Manager of Air Services, and in two monthly 'Due Diligence' reports (August and September). In essence his concerns related to unresolved problems associated with deployment (the static line and uncommanded inflation) and, in particular, to financial matters. [85] Significantly, however, the concerns expressed by Mr Marshall were not passed on to the Chief Executive nor to the Board Members and Chairman. When asked by the Committee why Mr Marshall's reports were not forwarded, Mr Peter Evans, General Manager of Air Traffic Services, stated:

[Due Diligence] is an internal reporting process. The call is on the general manager as to what is put forward. I suppose from my perspective, issues that Tony [Marshall] raised were things that we had discussed. They were not new to the process. I was aware they were there. We had just been through another evaluation process. My perception would be that if problems arose during the training process, we would have to address those. As I said, I was concerned that the reflection would be on my manager, SAR, rather than on the system, and they weren't new issues. So I took that as a report to me. [86]

2.78 Criticism of the Evaluation Panel's assessment also came from Mr Neil Boag, Chief Pilot for the commercial company General Flying Services. [87] In his submission to the Committee, Mr Boag was critical of a number of aspects of the Panel itself and of the procedures used for testing the two systems. In his opinion, the Panel members chosen were 'totally inappropriate in that none had any real experience in search and rescue operations and certainly none in dropping search and rescue equipment'. [88] On the physical conditions experienced during the trials Mr Boag commented: 'The weather conditions that existed at the time of the trials was totally unrealistic for any search and rescue evaluation. The drop zone was only just offshore, and in light winds the tidal effect is more than wind effect. This negates the trial as the Airservices Australia equipment relies on drifting down onto the target'. [89] In conclusion, Mr Boag stated: 'The trial at Merimbula can only be considered a joke, when compared to the professional tests previously completed'. [90]

Purchasing of PADS - September / October 1996

2.79 Having received the Evaluation Panel's interim report, the Chairman of Airservices Australia immediately commenced negotiations to purchase a number of PADS units from SAR Pty Ltd. Between 25 August 1996, when the Chairman of Airservices Australia telephoned SAR Pty Ltd to inform Mr Gruzman that PADS had been judged to be significantly superior, and 6 September 1996 when the purchase contract was finalised, there occurred a protracted volley of exchanges between Airservices Australia and SAR Pty Ltd as to the price to be paid for the PADS units, and other conditions of the contract. [91]

2.80 On Friday 30 August 1996 negotiations were conduced between SAR Pty Ltd and Airservices Australia on a package price for a certain number of PADS. A quote from SAR Pty Ltd was faxed on Sunday 1 September to Airservices Australia, outlining a package as follows:

supply of 125 PADS units and 70 storpedos;
training of all CSUs throughout Australia, as described;
delivery of equipment throughout Australia;
completed within 90 days of order;
total cost of $1,275,113;
cost reduced to $1,147,602, by a rebate of $125,511 with the sale of 500 PADS units overseas with the assistance of Airservices Australia. [92]

2.81 Airservices Australia objected to this quote, claiming a lower unit price had previously been quoted by SAR Pty Ltd and that the company was obliged to honour that quote. According to Airservices, the new unit price was nearly twice as much as had been initially tendered. [93] In addition, Airservices argued that training had never been part of the original tender. [94]

2.82 In reply, Mr Gruzman explained that the original quote and the subsequent package offered on 1 September were of approximately the same value, they were just expressed differently. [95] For reasons relating to overseas marketing, SAR Pty Ltd expressed a preference for the format given in the second quote but was willing to use the original quote if that was insisted upon by Airservices Australia. Mr Gruzman stated: 'Your contention is that we are bound to sell, as you are bound to buy, at the figures which I gave you off-the-cuff at about midnight on 6 August and which you wrote in your diary. We accept your contention and we regard the contract as effectual in those terms. The correct figure for the package based on that contract is $1,145,000. The difference is minuscule'. [96]

2.83 However, Airservices Australia rejected the stipulation that training be included in the PADS package. On 3 September the Chairman met with Mr Anton Gruzman and explained that 'the higher price was unacceptable and that training was never considered to be part of the initial purchase … '. [97]

2.84 To break the impasse that had developed over the purchase price, SAR Pty Ltd then offered Airservices Australia the choice of two packages: one which listed individual prices for each component (PADS units, storpedos, static lines, roping boards and roping tables), and one which gave a total price of $750,000 for 100 PADS units (and associated components). Training and training products would be the subject of separate negotiations. [98] On 4 September 1996, the Airservices Chairman issued an ultimatum to Mr Gruzman. It gave a per-component price that Airservices Australia was prepared to pay for PADS equipment and a request that a response be received from SAR Pty Ltd before 11.30am that day, a time chosen to allow consideration of the matter at the Board meeting set for noon. [99] The listing of items of PADS equipment to be purchased was:

104 units including a static line at $4950
52 Storpedos at $1550
26 training videos at $100
52 static lines at $750
26 roping boards at $95
26 roping tables at $225. [100]

2.86 The faxed reply from SAR Pty Ltd arrived at 10.53am rejecting the Airservices offer and requesting that Board members be given a copy of the explanatory letter. [101]

2.87 In response, the Chairman issued a terse three line letter to SAR Pty Ltd indicating that a 'comprehensive international tender' would be called by Airservices Australia 'in the near future'. Late that night, Mr Anton Gruzman rang Mr Forsyth to inform him that SAR Pty Ltd was prepared to sell PADS for the price dictated by Forsyth in his letter of 4 September 1996. This verbal agreement was confirmed by fax the following day.

2.88 The final contract, signed on 18 September 1996, was for:

104 PADS units (including static lines) at $4950 each;
52 storpedos at $1550 each;
26 roping tables at $1000 each;
26 roping boards at $95 each;
52 static lines at $750 each;
26 training videos at $100 each; and
80 coloured training manuals at $175 each.

2.89 The total cost of the PADS equipment, which was inclusive of packaging and delivery to SAR Pty Ltd at Merimbula, was just under $680,000.

Ministerial Involvement

2.90 During negotiations on the purchasing of PADS, SAR Pty Ltd made a number of attempts to involve the Minister and his staff. It is clear from material publicly available that both the Minister and his Senior Adviser, Mr John Wallis, were aware of the difficulties encountered by both parties during the negotiations as Mr Gruzman invariably copied his correspondence to the Minister's Office. Answers to questions without notice and correspondence, including correspondence from the Minister's senior Adviser, reveal that Mr Sharp and his office were involved from early May 1996, at the request of Mr Forsyth (see Paragraphs 2.40 - 2.44 and 2.95), in the decision to evaluate and subsequently purchase the PADS equipment.

2.91 The Minister met with Mr Gruzman at Parliament House where the equipment was both explained and demonstrated to Mr Sharp and Mr Wallis on 9 May 1996. Mr Wallis then represented the Minister at a demonstration of the equipment on Lake Burley Griffin on 11 June 1996.

2.92 Further, in an electronic memo dated 11 June 1996 and titled Mr Gruzman's drop on Lake Burley Griffin, Mr Neil McKay advised Mr Ian Rischbieth, Airservices Australia Policy Adviser, that Mr Wallis had indicated that Mr Gruzman had raised a number of issues about the SAREDS tender evaluation which needed to be investigated. [102]

2.93 Mr Peter Harris, First Assistant Secretary of Aviation Policy in the Department advised the Senate Rural and Regional Affairs and Transport Estimates Committee on 27 February 1997 that, as part of the review of search and rescue arrangements, he had no doubt at all that there would have been reference to earlier problems with PADS in discussions he had had with the Minister's office. [103]

2.94 In a letter dated 1 September 1966 from Mr Gruzman to Mr Bill Pollard, Chief Executive of Airservices Australia, it was stated: 'Our original undertaking to the Minister was to train and equip the entire complement of CSU organisations within 90 days of the order'. [104]

2.95 On 3 September 1996, Mr John Wallis, Senior Adviser to the Minister wrote to the Chairman of Airservices Australia, at his request, to clarify the price quoted previously by Mr Gruzman to the Minister:

I refer to the acquisition of search and rescue equipment delivery systems from Search and Rescue Pty Ltd.

For your information, in initial discussions with the Minister for Transport and Regional development, the Hon John Sharp MP, the Chief Executive Officer of that Company, Mr Laurie Gruzman QC, quoted the price per unit as $4 500.

This figure was consistently quoted in subsequent discussions between Mr Gruzman and the Minister and myself. [105]

2.96 In a submission to the Committee, the Minister described how this letter arose:

My Senior Adviser was informed on 3 September by Airservices that the Chairman was encountering difficulty in his negotiations with Mr Gruzman over the price of the PADS equipment. Airservices Australia asked him to confirm by fax to the Chairman the cost per unit mentioned by Mr Gruzman when extolling the merits of PADS to me and to members of my office. His recollection was sought in order to assist the Chairman in his negotiations. [106]

2.97 On that same day Mr Gruzman wrote a four page letter to the Minister describing the controversy that had developed over the purchase price for PADS. The letter began: 'Thanks for your call today. We respond to Mr Wallis' request that we provide a statement of facts for you to consider'. [107] This statement, however, was wrong. As clarified by the Minister in his submission:

On 4 September 1996, my Senior Adviser wrote to the Chairman of Airservices setting out the circumstances of Mr Gruzman's call and clarifying that the reference to "Thanks for your call" in Mr Gruzman's letter was a mistaken one: "Since Mr Gruzman is well aware that his conversation was with me and not with the Minister …". [108]

2.98 The following day, Mr John Wallis wrote to the Chairman of Airservices Australia, Mr John Forsyth:

Last night I was telephoned at home by Laurie Gruzman [who] sought to involve the Minister's office in intervention in what I understand is a dispute over the PADS supply. … [I] explained that the Minister could not intervene in the commercial management of Airservices unless there was a question of impropriety.

…

There is obviously some distance between the parties. That is a matter for you to address, but I would be grateful if you would keep me informed of events as they progress, since Gruzman is obviously going to seek to involve the Minister and I will need to be alert and fully informed to respond correctly to the situation. [109]

2.99 It is clear from this selection of exchanges that the Minister's Office, through Mr Wallis, was drawn into the controversy between Airservices Australia and SAR Pty Ltd over the purchase of PADS.

2.100 When problems were encountered with PADS training, Mr Anton Gruzman wrote at length to the Minister. [110] The Minister continued to distance himself from the continuing conflict, stating: 'I encourage you to take up these matters and any future concerns over commercial arrangements between Search and Rescue Pty Ltd and Airservices Australia directly with the Chairman and Chief Executive of Airservices'. [111] In conclusion, the Minister himself stated in his submission: 'It is clear from the correspondence that there was not only no involvement by me or my office in the negotiations over the PADS purchase, but rather a determination not to be involved'. [112]

Delivery

2.101 When the PADS units were delivered, in various shipments, inspections were carried out by Airservices Australia officers. At that stage quite a number of problems were encountered. In particular, there was confusion as to what to accept with regard to the static lines.

2.102 Recalling previous controversy over the safety of the static line, and the previous Civilair ban on it until a 'weak link' was included, Neil McKay of Airservices wrote: 'Its important that before going to Merimbula to accept the static lines you get tabs on what has been "approved" and make sure the CASA folk involved are aware of the arguments for having a weak link in the static line'. [113]

2.103 This memo precipitated a series of electronic exchanges within Airservices on recent modifications to the static line, weak links, cutting links, approved drawings, accredited manufacturers and CASA involvement; all indicative of the lack of certainty and confidence on the part of Airservices Australia in what it was accepting from SAR Pty Ltd.

2.104 Delivery of the PADS units also caused problems for Airservices Australia staff. The delivery point listed in the Airservices contract was Merimbula. The goods were to be picked up from Merimbula by Airservices and transported to Melbourne, an action which would incur additional cost. However, there was no budget allowance for payment of freight associated with delivery, and officers of Airservices expressed concern that it all seemed 'a very strange way of doing business'. [114]

Footnotes

[1] See for example, CAA Electronic Memo dated 9 May 1991 (11:55am EST) from John Fischer, ATS Workshop Essendon, to Neil McKay, Airservices Australia. Attached to letter from Mr Ian Rischbieth, dated 28 January 1997, Answers to questions taken on notice by Airservices Australia at a hearing of the Committee on 9 December 1996, Item 10 (Folder 3). (Hereafter referred to as 'Rischbieth').

[2] Ministerial Brief, April 1996, Search and Rescue (SAR): Involvement of Mr Laurence Gruzman, QC. Rischbieth, Part 6 (Folder 1), p. 1.

[3] For example, see the Final Report of the CAA Western Australia District Office, Air Traffic Services, Civil SAR Unit, PADS Static Line Trials, dated 24 September 1993, signed P McMullen, Civil SAR Coordinator. Rischbieth, Item 2 (Folder 4).

[4] Previous reviews had been carried out in 1984, 1987, 1989 and 1992.

[5] The CAA noted in its submission to the Joint inquiry that staff had expressed concerns about the use of PADS, particularly the operation of the static line, and that the Authority was conducting a Research and Development program to resolve those concerns. CAA Submission to the Joint Review of Air-Droppable Survival Equipment, dated 7 October 1993, p. 11.

[6] Joint Review of Air Droppable Survival Equipment Report by Consultant (J H Rowland) for AMSA, CAA and Department of Defence. December 1993, p. 30.

[7] Ibid, p. 33.

[8] Letter dated 14 May 1993 from Ken McLeod and David Williams to Buck Brooksbank, CAA, Brief: Letter dated 9 May 1993, from L Gruzman QC, Re PADS. Rischbieth, Item 10 (Folder 3).

[9] Electronic Memo dated 23 February 1994 from Ken McLeod to Ian Kearsley, CAA, Problems with PADS. Rischbieth, Item 10 (Folder 2).

[10] Evidence, p. RRA&T 245.

[11] Evidence, p. RRA&T 93.

[12] Department of Defence Royal Australian Air Force Aircraft Research and Development Unit, Formal Report - Task 0207 Support to Airservices Australia SAREDS Project Commonwealth of Australia AR-009-080 November 1995, pp. 1-3.

[13] Rural and Regional Affairs and Transport Legislation Committee Examination of Additional Estimates 1996-97, Additional Information Volume 7, Transport and Regional Development Portfolio, p. 1889.

[14] Department of Defence, op cit, p. 6.

[15] Ibid, p. 6.

[16] Ibid, p. 14.

[17] Ibid, Summary.

[18] Ibid, p.30.

[19] Ibid, p. 30.

[20] Joint Report on PADS - Precision Aerial Delivery System by Air Marshal David Evans, Captain Humphry Dell and Mr Brian Versace, dated 28 February 1996. Rischbieth, Item 2 (Folder 4).

[21] Ibid, p. 6.

[22] Evidence, p. RRA&T 96.

[23] SAR Equipment Delivery Systems Project (SAREDS) Tender Evaluation Plan Phase #3 Evaluation Report, January 1996 (page 3 of unpaginated text). Rischbieth, Part 4 (Folder 1).

[24] Ibid, p. 3.

[25] Ibid, p. 2.

[26] Ibid, p. 9.

[27] Letter dated 15 February 1996 from M G McKague, Purchasing Australia, Department of Administrative Services, to Mr L Gruzman, SAR Pty Ltd. Rischbieth, Item 2 (Folder 4).

[28] Cost of SAREDS Evaluation Process, Rischbieth, Part 5 (Folder 1).

[29] An Independent Review of the Search and Rescue Delivery Systems and Procedures Utilised by the Civil Aviation Authority conducted by Turtleair Pty Ltd in conjunction with Multitech Aircraft Services Pty Ltd, 28 May 1995.

[30] Evidence, p. RRA&T 247.

[31] Evidence, p. RRA&T 250.

[32] Evidence, p. RRA&T 251.

[33] Rural and Regional Affairs and Transport Legisaltion Committee Consideration of Estimates, Thursday 27 February 1997, Proof Copy pp. 17-19.

[34] Ministerial Office Briefing Search and Rescue (SAR): Involvement of Mr Laurence Gruzman, QC April 1996, p. 3. Rischbieth, Part 6 (Folder 1). See also Evidence, p. RRA&T 214.

[35] Wing and a prayer: search and rescue system in disarray . Sixty Minutes Sunday 9 June 1996. Department of the Parliamentary Library Information Storage and Retrieval System, transcript taken from a tape recording, p.1.

[36] Ibid p. 6.

[37] Ibid, p. 6.

[38] Evidence, p. RRA&T 272.

[39] Electronic Memo dated 10 December 1996 (12:55pm EST) from John Fischer (FMD/ASMB) to Neil McKay, Airservices Australia, Merimbula 60 Minutes Exercise. Rischbieth, Item 10 (Folder 2).

[40] Media Statement dated 20 June 1996 New Testing For Search and Rescue by The Hon John Sharp, Minister for Transport and Regional Development, Reference: TR59/96.

[41] Evidence, p. RRA&T 145.

[42] Evidence, pp. RRA&T 141-142.

[43] Letter dated 4 August 1996 from Mr John Forsyth, Chairman, Airservices Australia, to the Hon John Sharp, Minister for Transport and Regional Development. Rischbieth, Part 1 (Folder 1).

[44] Ibid.

[45] Ibid. (See also Evidence, pp. RRA&T 151-152.)

[46] Ibid.

[47] Evidence, p. RRA&T 152.

[48] Ibid.

[49] Evidence, p. RRA&T 149.

[50] Evidence, p. RRA&T 145.

[51] Evidence, p. RRA&T 142.

[52] Letter dated 5 August 1996 from Mr John Wallis, Senior Adviser, Office of the Minister for Transport and Regional Development, to Mr John Forsyth, Chairman, Airservices Australia. Rischbieth, Part 1 (Folder 1).

[53] Rural and Regional Affairs and Transport Legislation Committee Examination of Additional Estimates 1996-97, Proof Committee Hansard, Thursday 27 February 1997, p. 11

[54] Evidence, p. RRA&T 57.

[55] The resolution stated: ' … in the event it is determined by an independent panel of experts that the Airservices search and rescue delivery system should be replaced either partially or in full by equipment available from SAR Pty Ltd or a third party, then the replacement system shall be purchased within a financial limit of not more than $1 million. This resolution is based on safety and public interest considerations and shall remain current for a period not exceeding six months.' Evidence, p. RRA&T 143.

[56] Evidence, p. RRA&T 143.

[57] Letter dated 12 August 1996 from Mr John Forsyth, Chairman, Airservices Australia to Mr Laurie Gruzman, SAR Pty Ltd, p.2. Rischbieth, Part 1 (Folder1).

[58] Ibid.

[59] Ibid.

[60] Evidence, p. RRA&T 184.

[61] Evidence, p. RRA&T 74.

[62] The relevant regulations covering search and rescue are: CAR149 Towing; CAR150 Dropping of Articles; CAR157 Low Flying; CAR 262 Carriage of Dangerous Goods; CAO29.10 Low Flying; and CAO 29.5 Dropping of Articles from Aircraft in Flight.

[63] Rural and Regional Affairs and Transport Legislation Committee Examination of Additional Estimates 1996-97, Additional Information Volume 7, Transport and Regional Development Portfolio, p. 1877.

[64] Letter dated 7 August 1996 from Mr John Forsyth, Chairman, Airservices Australia, to The Hon Mr Justice William Fisher, Chairman, CASA. Rischbieth, Part 1 (Foler 1).

[65] Letter dated 14 August 1996 from Mr John Forsyth, Chairman, Airservices Australia, to The Hon Mr Justice William Fisher, Chairman, CASA. Rischbieth, Part 1 (Folder 1).

[66] Letter dated 16 August 1996 from Mr Justice Fisher, Chairman, CASA, to Mr John Forsyth, Chairman, Airservices Australia. Rischbieth, Part 1 (Folder 1).

[67] Evidence, p. RRA&T 125.

[68] Evaluation Panel report p.18, as quoted in Evidence, p. RRA&T 125.

[69] Rural and Regional Affairs, op cit, pp. 1884-8.

[70] Evidence, p. RRA&T 127.

[71] Evidence, p. RRA&T 129.

[72] Evidence, pp. RRA&T 35-36.

[73] Evidence, p. RRA&T 36.

[74] Evidence, p. RRA&T 39, See also Evidence, pp. RRA&T 66, 198, 202-205.

[75] Evidence, p. RRA&T 128.

[76] Undated letter from Mr Neil Boag, Chief Pilot, General Flying Services, to Mr Marshall, SAR Manager, Airservices Australia. Attached to A Report on the Evaluation of Search and Rescue Aerial Delivery Systems Conducted at Merimbula NSW and SE Victoria during the period 19-23 August 1996. Commissioned by Airservices Australia.

[77] Rural and Regional Affairs, op cit, p. 1893.

[78] Rural and Regional Affairs, op cit, p. 1876.

[79] A Report on the Evaluation of Search and Rescue Aerial Delivery Systems Conducted at Merimbula NSW and SE Victoria During the Period 19-23 August 1996. Commissioned by Airservices Australia, pp 6 - 21.

[80] Ibid, p.19.

[81] Letter dated 24 August 1996 from Mr Frank Young, Chairman, Evaluation Panel, to Mr John Forsyth, Chairman, Airservices Australia. Rischbieth, Part 1 (Folder 1).

[82] Evidence, p. RRA&T 155.

[83] A Report on the Evaluation of Search and Rescue Aerial Delivery Systems Conducted at Merimbula NSW and SE Victoria During the Period 19-23 August 1996. Commissioned by Airservices Australia, Annex 3, Reports from Participants, Letter from Mr Tony Metcalf.

[84] Ibid, p. 2.

[85] Memo dated 4 September 1996 from Mr Tony Marshall, A/g Manager, SAR, to Mr Peter Evans, General Manager, Air Traffic Services, Airservices Australia, Re: Response to Gruzman fax 1st September 1996. Rischbieth, Item 10 (Folder 2).

[86] Evidence, p. RRA&T 48.

[87] Mr Boag was also the pilot chosen by the Evaluation Panel to train three pilots in Airservices Australia supply dropping procedures

[88] Submission No. 1, p. 1.

[89] Ibid, p. 3.

[90] Ibid, p. 8.

[91] Evidence, pp. RRA&T 143 -144.

[92] Letter dated 1 September 1996 from Mr Laurie Gruzman, SAR Pty Ltd, to Mr Bill Pollard, Chief Executive, Airservices Australia. Rischbieth, Part 1 (Folder 1).

[93] Evidence, p. RRA&T 143.

[94] Evidence, pp. RRA&T 143-144.

[95] Letter dated 3 September 1996 from Mr Laurie Gruzman, SAR Pty Ltd, to Mr John Forsyth, Chairman, Airservices Australia. Rischbieth, Part 1 (Folder 1).

[96] Ibid.

[97] Evidence, p. RRA&T 144.

[98] Letter dated 4 September 1996 from Mr Laurie Gruzman, SAR Pty Ltd, to Mr John Forsyth, Chairman, Airservices Australia. Rischbieth, Part 1 (Folder 1).

[99] Letter dated 4 September 1996 from Mr John Forsyth, Chairman, Airservices Australia to Mr Laurie Gruzman, SAR Pty Ltd. Rischbieth, Part 1 (Folder 1).

[100] Letter dated 4 September 1996 from Mr John Forsyth, Chairman Airservices Australia, to Mr Anton Gruzman, SAR Pty Ltd. Rischbieth, Part 1, (Folder 1). Note: later correspondence from SAR Pty Ltd argued that there had been an error in the price quoted originally for the roping tables and that the price should have been $1295 each.

[101] Evidence, p. RRA&T 144.

[102] Electronic memo dated 11 June 1996 (04.55pm EST) from Neil McKay, Manager, Mechanical & Electrical Engineering, Airservices Australia, to Ian Rischbieth, et al, Re: Mr Gruzman's Drop on Lake Burley Griffin. Rischbieth, Item 10 (Folder 2).

[103] Rural and Regional Affairs and Transport Legisaltion Committee Consideration of Estimates, Thursday 27 February 1997, Proof Copy pp. 10-11.

[104] Letter dated 3 September 1996 from Mr John Wallis, Senior Adviser, Minister for Transport and Regional Development, to Mr John Forsyth, Chairman, Airservices Australia. Rischbieth, Part 1 (Folder 1).

[105] Letter dated 1 September 1996 from Mr Laurie Gruzman, SAR Pty Ltd, to Mr Bill Pollard, CEO, Airservices Australia, et al. Rischbieth, Part 1 (Folder 1). See also Evidence, pp. RRA&T 177-180.

[106] Submission No. 2, p. 2. Letter dated 6 March 1997 from The Hon John Sharp MP, Minister for Transport and Regional Development to Senator John Woodley, Chairman, Senate Rural & Regional Affairs and Transport Committee.

[107] Letter dated 3 September 1996 from Mr Laurie Gruzman, SAR Pty Ltd, to The Hon Mr John Sharp, Minister for Transport and Regional Development. Rischbieth, Part 1 (Folder 1).

[108] Submission No. 2, op cit, p. 3.

[109] Letter dated 4 September 1996 from Mr John Wallis, Senior Adviser, Minister for Transport and Regional Development, to Mr John Forsyth, Chairman Airservices Australia.

[110] Letter dated 19 November 1996 from Mr Anton Gruzman, SAR Pty Ltd, to The Hon Mr John Sharp, Minister for Transport and Regional Development. Attached to a letter dated 26 February 1997 from the Minister to Senator J Woodley, Chairman, Senate Standing Committee on Rural and Regional Affairs and Transport.

[111] Letter dated 21 November 1996 from the Minister for Transport and Regional Development, John Sharp, to Mr Anton Gruzman, SAR Pty Ltd. Attached to a letter dated 26 February 1997 from the Minister to Senator J Woodley, Chairman, Senate Standing Committee on Rural and Regional Affairs and Transport.

[112] Submission No. 2, op cit, p. 3.

[113] Electronic memo dated 9 October 1996 from Neil McKay, Team Leader, Mechanical & Electrical Engineering, Airservices Australia, to John Fischer, Re: Acceptance of PADS equipment. Rischbieth, Item 10 (Folder 2).

[114] Electronic memo dated 7 October 1996 from John Maynard, Facilities Management, Airservices Australia, to Tony Hankins, PADS Acceptance. Rischbieth, Item 10 (Folder 2).