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 AMSA’s 2020-21 audited year-end results, budget for 2021-22, and estimates for the three following years, aligning with 2021-22 Portfolio Budget Statements. This is an updated CRIS from the version published in July 2021. 

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. 

1.2 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 coordination²’. 

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 waters3 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) [1], 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 [2], 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 appropriations⁴, 
• Funding arrangements of shipping and offshore petroleum industries and the International Oil Pollution Compensation (IOPC) fund⁵, 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. 

1.2.4 Stakeholders 

The principle stakeholders for AMSA’s regulatory charging activity outputs are: 

• vessel owners and operators, and their associated agents – international vessels (~5,800) and domestic commercial vessels (~31,000), 
• seafarers and coastal pilots – international (~60,000) and domestic (~66,000), 
• accredited marine surveyors (~250), 
• registered training organisations, 
• Commonwealth, State and Northern Territory agencies, and 
• the Australian community. 

Footnotes

2. Department of Infrastructure, Transport, Regional Development and Communication, Portfolio Budget Statement 2021-22 [3], 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.

2.1 Government policy approval to cost recover regulatory activities 

The Explanatory Memorandum of the Australian Maritime Safety Authority Act 1990 [4] states the Government’s intent that AMSA ‘will run on a self-funded basis, with services which cannot be provided on a self-funded basis (search and rescue coordination services) to be paid by the Commonwealth’. 

AMSA recovers costs from participants in the commercial shipping industry in adherence with Public Governance, Performance and Accountability (Charging for Regulatory Activities) Order 2017 [5], which refers to the Australian Government Charging Framework and CRGs. 

2.2 Statutory authority to charge 

AMSA’s regulatory charging activities are authorised by the application of Australian Commonwealth legislative instruments, in particular Part 5, Division 2 of the Australian Maritime Safety Act 1990 [6], which provides for the charging of levies and fees with references to the following Acts: 

• Navigation Act 2012 [7] 
• Marine Navigation Levy Act 1989 [8]
• Protection of the Sea (Shipping Levy) Act 1981 [8]
• Marine Navigation (Regulatory Functions) Levy Act 1991 [9]
• Shipping Registration Act 1981 [10]

With statutory authority to charge National System fees arising from Section 150, Schedule 1 of the Marine Safety (Domestic Commercial Vessel) National Law Act 2012 [11]. 

A summary by AMSA’s activity outputs of government policy approval to cost recover, including date of approval, and statutory authority to charge with legislative references is included in Appendix 1. 

3.1 Outputs and business processes of the regulatory charging activities 

3.1.1 Activity outputs 

As described in Section 1.2.1, AMSA’s role is to deliver on seafarer and ship safety, and marine environmental protection through regulation, as well as provide search and rescue capability. The broad outputs and primary activities for all roles are itemised in Table 2, which also notes whether the output is subject to regulatory charging (cost recovery) or not.

Table 2: AMSA’s broad activity output listing 

Activity output	Primary activities	Regulatory charging?
Search and rescue activities and functions	Operating AMSA Response Centre, coordinating maritime and aviation search and rescue.  Providng a ground station and Mission Control Centre for the Cospas Sarsat distress beacon detection system.  Maintaining maritime distress and safety communications services.  Providing dedicated airborne search and rescue services.	No, funded by government budget appropriations
Navigational infrastructure	Providing and maintaining a national network of marine aids to navigation (AtoN) and related navigational systems and measures.  Intergovernmental and international engagement to shape and ensure appropriate maritime standards are in place (e.g. for Australia’s obligations under the SOLAS convention and for the provision of AtoN that align with international guidance from IALA).	Yes
Environmental marine protection	Managing the National Plan, including crisis preparedness to combat marine environmental emergencies (pollution incidents).  Regulating, monitoring, and coordinating maritime casualty management and emergency towage capability.  Conducting pollution prevention public awareness and education campaigns.	Yes
Seafarer and ship safety under Navigation Act 2012 and other Acts	Monitoring compliance with operational standards for ships in Australian waters, under the Act, to ensure their seaworthiness, safety and pollution prevention.  Participating in the development and implementation of national and international marine safety and environment protection standards.  Providing public access to ship safety and environment protection standards and policies.  Administering training standards for seafarers and coastal pilots.  Conducting safety public awareness and education campaigns.  Exercising occupational health and safety inspectorate functions.	Yes
Marine services under Navigation Act 2012 and ship registration under Shipping Registration Act 1981	Administering certificates of competency for seafarers and coastal pilots.  Conducting inspections, surveys, and audits requested by ship owners or their agents.  Administering Australia’s ship registration system.	Yes
Marine services under National System for domestic commercial vessels	Assessing applications and issuing approvals and certificates of operation, survey, and competency of near coastal seafarer qualifications.  Assessing applications and issuing approvals for network of accredited marine surveyors.  Assessing applications that request exemptions from the application of the National System, and equivalent means of competency.	Yes
Seafarer and ship safety under the National System for domestic commercial vessels	Monitoring compliance with standards for the domestic commercial vessel fleet,   Participating in the development and implementation of domestic marine safety and environment protection standards.  Conducting safety awareness and education campaigns for domestic commercial vessel industry.	No, funded by combination of government budget appropriations and jurisdiction contributions
Externally funded programs	Externally funded programs sponsored by various government departments for provision of specific maritime related services, predominantly in relation to search and rescue capabilities.	No, funded by various government departments

Operational targets of activity outputs are contained in the annual report and performance statements of AMSA’s, which describes the reportable measurements to achieve policy outcomes. A summary of regulatory charging activity non-financial performance measures is in Section 8. 

3.2.1 Business processes 

Levy-based activities 

Levy-based charging activities relate to the provision of statutory regulatory services to a group of individuals or organisations, as opposed to transactional business processes. These regulatory-based business processes are carried out as overall activities that aim to minimise the risks of shipping and pollution incidents and maximise safety of people involved. 

Business processes include provision and maintenance of aids to navigation sites, standard and policy development specifically related to our regulatory functions, managing the National Plan for maritime environmental emergencies, compliance audits, investigations and enforcement, and development and promulgation of educational and advisory material. 

Fee-based activities 

Driven largely by transactional business processes specifically performed for, or at the request of, or on the application of a particular individual or organisation. Fee-based regulatory charging activities support specific regulatory functions to which the fees relate. There is clear and distinct linkage of costs of the business processes to an individual or organisation. 

Generic business processes for AMSA’s fee-based activities include: 

• receipt, review, and decision on an application, including ongoing consultation with the applicant, 
• undertaking technical assessment, with a decision made by a delegate, and 
• processing and issuing a certificate, license, exemption, determination, or approval. 

In practice, administrative business procedures for the receipt, review and issue are broadly similar across fee-based charging activities. However, time and effort (and associated costs) for technical assessments and decisions vary between the types of outputs and on the complexity or nature of the application. 

3.2 Costs of regulatory charging activities 

AMSA applies an activity-based costing methodology to determine costs for activity outputs and regulatory charging activities, as depicted in Appendix 2. This holistic methodology allocates all costs to activity outputs based on estimated time and effort, and associated cost drivers. 

3.2.1 Changes in costing model techniques 

In developing the 2021-22 budget, AMSA undertook an activity-based costing and zero-based budget exercise building on the framework developed in 2020-21 that is transparent, defensible, and repeatable. The approach in developing costing models is contained in Appendix 3, including cost drivers, assumptions, and sensitivities. 

AMSA is currently engaged in the next stage of its continuous improvement program by mapping key processes, measuring effective service delivery, and analysing costs through benchmarking direct and overhead activities against industry standards to determine efficiency. This will support the government review of AMSA’s operations and reduce administrative burden and costs to regulated entities, without compromising safety. 

3.2.2 Nature of costs 

The nature and make-up of costs vary considerably across AMSA’s regulatory charging activity groups. For example, for provision and maintenance of aids to navigation there is an extensive capital cost component (depreciation), with consistently high operational maintenance costs, reflecting the hostile environmental conditions in which these assets operate. 

In contrast, compliance and certification activity groups are labour intensive and as such have a high staff cost component. Generally, activities with a large staffing level require a higher proportion of property operating expenditure and ICT overheads compared to activities that have minimal labour inputs. 

3.2.3 Cost categories 

Direct 

Direct costs are those costs directly and clearly attributed to an activity group based on estimations of resource requirements to deliver statutory and regulatory obligations, and include direct operational management support activities – direct costs include employee, suppliers, and depreciation expenditure. 

AMSA business line managers provided direct input in assigning costs to activities, including staff utilisation to achieve operational outcomes validated by estimated time and effort requirements, and supplier costs based on an analysis and nature of expenditure. 

Corporate overheads 

Overheads include property operating expenditure, ICT networking, communication costs, and enabling tasks and processes to support service delivery of AMSA’s activity outputs through provision of corporate services and executive functions. 

Enabling overheads comprise executive, human resources, finance, governance, and general ICT support – accompanying their respective share of property operating expenditure, ICT networking, and communication costs. 

AMSA applies several cost drivers to allocate indirect, support, and corporate overhead costs to direct activity outputs, as detailed in Appendix 3. 

Capital costs 

Depreciation and amortisation is a representation of capital costs, used to determine capital expenditure requirements for replacement and enhancement of assets. Assessed on an asset-by-asset basis to identify the appropriate treatment, where there is a specific direct link depreciation is assigned to that activity group, whereas corporate support related depreciation is assigned to the appropriate overhead classification. 

3.2.4 Cost estimates for 2021-22 

Estimated costs for providing AMSA’s regulatory charging activities, broken down into direct average staffing levels (ASL), and direct, overheads, and capital costs is set out in Table 3.

 Table 3: Breakdown of costs estimates for 2021-22 

Activity output and groups	Direct  ASL*	Direct   ($’000)	Corporate overheads  ($’000)	Capital  ($’000)	Total  ($’000)
Navigational infrastructure	13.9	22,721	3,973	6,832	33,526
Provision and maintenance of aids to navigation	8.7	19,005	2,670	6,672	28,347
Vessel traffic services (ReefVTS)	0.7	2,692	250	10	2,952
Provision of under keel clearance management	0.7	191	644	100	935
Standards development	2.0	497	218	26	741
Other**  (i.e. native title management, and levy management)	1.8	336	191	24	551
Environmental marine protection	14.2	20,863	3,631	1,731	26,225
National Plan pollution response	13.0	20,675	3,498	1,713	25,886
Other**  (i.e. education and engagement, and levy management)	1.2	188	133	18	339
Seafarer and ship safety	118.7	34,247	15,941	1,924	52,112
Compliance	32.0	8,901	3,927	391	13,219
Standard development	28.4	7,153	3,194	375	10,722
Integrated operations	16.9	4,617	3,677	229	8,523
Decision support and intelligence	5.2	4,431	792	64	5,287
Enforcement	10.6	2,547	1,161	128	3,836
Education and engagement	9.1	2,176	1,042	127	3,345
Maritime distress alerting and safety systems	6.8	1,762	995	323	3,080
Audit and assurance	2.8	751	309	34	1,094
Ship registration	1.6	736	197	138	1,071
Other**  (i.e. certification, qualifications, vessel traffic safety, seafarer safety, exemptions and approvals, and levy management)	5.3	1,173	647	115	1,935
Marine services & ship registration	24.0	5,858	3,118	708	9,684
Certification	7.3	2,124	1,068	352	3,544
Qualifications	9.6	1,985	1,221	115	3,321
Audit and assurance	4.6	1,313	569	57	1,939
Ship registration	2.0	286	211	178	675
Exemptions and approvals	0.5	150	49	6	205
Marine services National System	22.2	5,079	2,984	776	8,839
Certification	11.7	2,841	1,672	550	5,063
Qualifications	8.8	2,015	1,140	206	3,361
Exemptions and approvals	1.7	223	172	20	415
Total for regulatory charging	193.0	88,768	29,647	11,971	130,386

*     Direct ASL does not include line manager support, corporate support, nor non-regulatory charging activities (such as search and rescue or National System regulatory function output currently funded by government). 

**     Consists of various activities considered immaterial for reporting purposes. 

3.3 Design of regulatory charges

3.3.1 Charging structure 

Regulating international shipping and domestic commercial vessels and seafarers is a complex undertaking, with a wide variety of vessel types, manning levels, competency prerequisites, handling requirements for various cargoes, operational conditions, and jurisdiction and international obligations. 

AMSA applies a ‘user pays’ principle for regulatory charging activities. The design of AMSA’s regulatory charging activity outputs considers whether the provision of such regulatory activities is to an individual entity (reasonably attributed to that entity), or to a group of entities (provided to commercial shipping industry and broader community) – where the former, fees are charged, whereas the latter involves levies. 

AMSA’s broad charging structure is summarised in Table 4.

 Table 4: Charging structure of regulatory activity outputs 

Activity output	Charging mechanism	Structure
Levy-based activities
Navigational infrastructure	Marine Navigation Levy	Net registered tonnage – sliding scale
Environmental marine protection	Protection of the Sea Levy	Net registered tonnage – linear
Seafarer and ship safety under Navigation Act 2012 and other Acts	Regulatory Function Levy	Net registered tonnage – sliding scale
Fee-based activities
Marine services under Navigation Act 2012 and ship registration	Fee Determination  (fee-based activities)	Direct (fixed) fee or hourly rate
Marine services under National System	National Law Regulation  (fee-based activities)	Direct (fixed) fee or hourly rate

 

Levy-based activities 

AMSA’s methodology for charging levies is derived from historical predecessors, as well as international standards where banding by tonnage is considered common practice for the commercial shipping industry. Levy rates within these bands, are adjusted periodically to address shortfalls or imbalances, with the last change occurring in 2014-15. 

International commercial vessels are liable for levies on either (1) the date of arrival to an Australian port, or (2) where the vessel is in Australian waters with no corresponding paid levy applicable for the previous three months, the day after the end of that period. For Australian coastal trading vessels, unless the vessel is out-of-service, levies are payable at the start of each quarter. 

The average number of port visits during each levy payment period (three months) varies depending on the vessel type and handling of cargoes, with bulk cargo vessels averaging around one to two visits per levy payment period and container ships around five to six. 

The commercial shipping industry pays levies on non-exempted vessels⁶ that are twenty-four metres or more in tonnage length, with the rate based on a vessel’s net registered tonnage, with environmental marine protection activity output charged on vessels that also carry ten or more tonnes of oil on board⁷, with a minimum amount payable of $10. AMSA’s levy ready reckoner is in Table 5.

Table 5: AMSA’s levy ready reckoner

	Net Registered Tonnage (NRT)
From:	0	5,001	20,001	50,001
To:	5,000	20,000	50,000	∞
Levy*	Cents per NRT	Cents per NRT	Cents per NRT	Cents per NRT
Marine Navigation Levy	23.50	12.00	7.00	2.50
Regulatory Function Levy	17.00	17.10	17.00	15.50
Protection of the Sea Levy	11.25	11.25	11.25	11.25
Levy calculation method	51.75c for each tonne	$2,587.50 plus 40.35c for each tonne over 5,000	$8,640.00 plus 35.25c for each tonne over 20,000	$19,215.00 plus 29.25c each tonne over 50,000

 

The majority of vessel types visiting Australia continue to be bulk cargo carriers, with iron ore and coal vessels contributing ~67% of total net tonnage – which indicates a heavy reliance on iron ore and coal exports. 

Despite the steady increase in the quantity and size of international ships visiting Australian ports, shipping usage for aids to navigation, demand for inspections, and other regulatory functions is largely influenced by externalities that may impact volumes year-on-year. These are largely outside the control of AMSA, including the COVID-19 pandemic, potential trade disputes, economic disruptions, and the changing climate. 

In relation to environmental marine protection, given the nature and purpose of this activity, it is not possible to ascertain when a marine environmental emergency will occur. When an incident does occur, costs of clean-up operations and financial commitments can be enormous, with legal proceedings often taking years to conclude. While international compensation regimes are generally highly effective, the cost of responding to an incident can exceed the available liability and compensation limits. From evidence of significant incidents overseas, governments have had to bear the shortfall, which can be many hundreds of millions of dollars. 

These factors mean that any projections of expected growth (or reductions) in demand for regulatory charging activities must consider complex relationships within the commercial shipping industry. AMSA is continuing to develop and rollout risk-based models to provide better insights into the linkage between the level of regulation effort to cost recovered revenue from industry.  

Fee-based activities 

Fee-based activities include, assessment of applications, exemptions and determinations, inspections and surveys, registration of vessels, conducting examinations, and accreditation of non-government service providers. 

AMSA applies fixed fees to regulatory charging fee-based activities where the range of typical delivery times do not vary significantly from the standard average time. Where there are wide variations, indicated by significant divergences from the standard deviation, the basis of the relevant charge is an hourly rate, and any reasonable unavoidable travel costs. These travel costs may be flights and accommodation, where provision of services are at locations remote from AMSA’s regional offices⁸, or motor vehicle travel rates where vehicles are used for the mode of transportation to and from offices⁹. 

Marine services and ship registration is tracked using multiple systems, including a Coastal Pilotage System, International Marine Qualifications System, NAVIS (ship registration), MARS (domestic commercial vessels), and Financial Management Information System. Volumes are estimated based on inputs provided by business line managers during the budget development process, using largely historical data obtained from these various systems, and adjusted for expected variances. 

A schedule of fee-based regulatory charging activities, separated into fees under the Navigation Act 2012 and fees under National System, is included in Appendix 4. Charging rates are published on AMSA’s website [12]. 

3.3.2 Revenue estimates 

Revenue estimates budget, and the three forward year estimates are summarised in Table 6. 

Table 6: Revenue estimates 

		Budget	Forward Year Estimates
Activity outputs		2021-22  ($’000)	2022-23  ($’000)	2023-24  ($’000)	2024-25  ($000)
Levy-based activities
Navigational infrastructure		36,226	36,625	37,000	37,375
Environmental marine protection		36,379	36,725	37,100	37,475
Seafarer and ship safety		54,595	55,150	55,700	56,250
Total levy-based activities		127,200	128,500	129,800	131,300
Fee-based activities
Fees under Navigation Act 2012 and Shipping Registration Act 1981		3,885	3,885	3,885	3,885
Fees for National System		3,805	3,805	3,805	3,805
Total fee-based activities		7,690	7,690	7,690	7,690
Total regulatory charging		134,890	136,190	137,490	138,790

3.3.3 COVID-19 disruptions and bushfire relief 

In 2020-21, AMSA committed to the continuation of providing relief to the domestic commercial industry and seafarers from natural disaster disruptions, such as the 2019-20 bushfires, and COVID-19 pandemic. As part of this commitment, AMSA has implemented: 

• exempting vessels used in emergencies such as evacuation of bushfire victims, 
• minimum safe manning requirements and safety management system temporary updates in response to a natural disaster, and 
• general exemption for seafarers providing an extension for certificates of competency with expiry dates between 26 March 2020 and 31 January 2021, with no charge for the process for applying for renewals. 

3.3.4 Review of charging structures 

AMSA is engaged in a comprehensive all-inclusive review of its regulatory charging activities, structures and rates in anticipation of the government review. The following specific items are planned to be assessed over the next twenty-four months: 

• Following the refined activity-based costing and zero-based budget exercise, undertake an analysis of direct processes and corporate overheads to assess efficiency, including benchmarking with external entities. 
• Assess levy regulatory drivers to approximate levels of resources used to produce activity outputs, to demonstrate a linkage between the level of effort and the output. Initial findings indicate net tonnage for our levies (Marine Navigation Levy, Protection of the Sea Levy, and Regulatory Functions Levy) may be an appropriate driver of effort. Work is continuing to finalise AMSA’s conclusions, with any proposed change to involve wide and extensive consultation.  
• Assess whether the delivery of fee-based activity outputs at minimal costs is the most effective and efficient way to deliver services, and whether industry can fully absorb the resultant cost of service delivery. 
• Review hourly and fixed rates of fee-based activities under the Navigation Act 2012, Shipping Registration Act 1981, and the National System. Where similar personnel, expertise, and services are performed, rates should align. 
• Investigate an indexation strategy (if applicable) on regulatory charging activities and the need to regularly revise charge-out rates, to reduce inflationary pressures on costs. 
• Work with industry and government on an agreed level of maintenance and utilisation of regulatory charging reserves to fund specific requirements. 

AMSA will engage widely and extensively with stakeholders once the government review commences, providing opportunities for feedback on any proposed changes, with provisions to address industry concerns. A stakeholder engagement strategy will be prepared for each consultation. 

Footnotes

⁶ There is a list of exemptions contained in the Marine Navigation Levy Collection Regulations 2018 [13], Marine Navigation (Regulatory functions) Levy Collection Act 1991 [14], and Protection of the Sea (Shipping Levy) Regulation 2014 [15].

⁷ There will be situations where vessels exempted from both the Marine Navigation Levy and Regulatory Function Levy may be liable for the Protection of the Sea Levy. Generally, these vessels include fishing, religious charitable, non-for-profit organisation, or research vessels.

⁸ Given the various locations of AMSA offices, these costs will generally be limited.

⁹ Defined as more than twenty-five (25) kilometres from an AMSA office, the charge is based on a per kilometre basis specified by the Australian Taxation Office business use rates.

AMSA has implemented internal controls to ensure costs recovered for regulatory charging activity outputs are measured correctly and are collected on time. In adherence with legislative obligations, an officer of Australian Border Force may detain a vessel at any Australian port for any unpaid and outstanding levies. The vessel can only be released after payment is received. This process ensures the existence of any unpaid levies are consistently at a very low level. 

An assessment of regulatory charging activities was conducted using Department of Finance’s Charging Risk Assessment. AMSA considers the risk to remain low to medium, given no anticipated changes (other than indexation) to current activities in 2021-22. Identified risks, accompanying mitigation strategies and controls, are provided in Table 7 with additional details provided in AMSA’s Corporate Plan [16]. 

Table 7: Risks and mitigation strategies associated with regulatory charging

Risk identified	Inherent risk	Mitigation strategy and controls	Residual risk
Funding risk to levies  Levies are collected based on tonnage proxies predominately from the number of arriving international commercial vessels, with the majority of levies (67%) sourced from iron ore and coal bulk cargo.  Economic factors, such as COVID-19 disruptions or a trade dispute, may adversely reduce AMSA’s levy revenue as the number of international vessels arriving at Australian ports decrease. Tonnage (and revenue) may drop quickly in reaction to economic pressures.  In the short-to-medium timeframe, our regulatory service delivery (and associated costs) will remain similar (sticky); as revenue decrease, it may not be enough to cover expenditure.	High	Capability to implement a range of efficiency measures within a medium timeframe to offset any potential reductions in levy revenue without need to adjust rates.  Regularly compare regulatory charging costs against revenue and volumetric data to ensure unit costs are reflective of pricing within each tonnage bands.  Review use of tonnage-based proxies for levies to enable charges to be more reflective and closely linked to level of effort – weighed up against ease of operation and associated costs to administer.  Work with the Department of Infrastructure, Transport, Regional Development and Communications (Department of Infrastructure) and the Government to consider the appropriateness of levy rates.	Medium
Secure funding for National System  National System regulatory-based activities are funded by a combination of government budget appropriations and jurisdiction contributions. Full government funding for functions (except fee-based activities) has been committed to 30 June 2022, with future arrangements expected to be considered through a government review of effectiveness in service delivery and cost efficiency.  AMSA must work with the Department of Infrastructure and the Government to ensure sufficient funding for the National System regulatory activities to avoid shortfalls.	Severe	Engage early and regularly with government and industry groups (principle external stakeholders).  Determine and segregate one-off developmental and transitional costs from business-as-usual costs associated with National System, with the former funded by retained earnings.  Work with the Department of Infrastructure and Government to consider future funding models and arrangements for the National System following the government review.	Medium
Ensure regulated industry are operating to appropriate standards  Failure as a regulator to prevent an incident or fatality in relation to compliance and enforcement arrangements.	High	Continue to review measures to minimise the risks of shipping and pollution incidents and maximise safety of people involved – including education and training.  Ensure targets are being met for ship inspection programs, navigational services, and safety and regulatory, assessed on a risk-based approach, while implementing and applying lessons learnt.	Medium
Reserves not enough to fund a major pollution incident clean-up  A major environmental emergency pollution incident resulting in clean-up costs exceeding retained earning reserves, damaging reputation, and forcing AMSA to seek special appropriation funding from government.	High	Implementation and maintenance of a pollution response reserve to fund any potential clean-up costs deemed appropriate for up to a 450-500 tonne oil spill.  Should an extreme pollution incident occur, work with the Department of Infrastructure and the Government to consider a temporary increase in levy rates to fund any shortfall.  Seek a drawdown for a special appropriation should an extreme pollution incident occur.	Low
Inflated or escalating costs  Escalating costs to provide regulatory activities to principle stakeholders and costs that may be beyond that deemed efficient.  Business processes may not be efficient or effective in the delivery of regulatory charging activities, with corporate overheads unnecessarily large. This may have negative long-term impacts on AMSA’s budget, or result in industry paying more in the recovery of costs than required – cost efficiency is an Australian Government cost recovery obligation.	High	Analyse direct costs, including staffing levels and classifications, average time in service delivery, ICT infrastructure (software) support, managerial engagement, and supplier (contractual) costs.  Business process map tasks in the delivery of regulatory services (direct tasks) and compare (benchmark) to other agencies providing similar services.  Review and analyse all corporate related costs (property, networking, ICT, and corporate support), benchmarking to similar agencies – incorporate some measurement into key performance indicator reporting.	Low
Key performance indicators  Not effective in measuring progress of specific activities, not maintained as an ongoing and reportable measurement. Difficult to assess AMSA’s effectiveness in the delivery of services and progress achieving policy outcomes to acceptable standards of industry.	Medium	Engage and agree KPIs with external stakeholders.  Report on KPIs in external published documents (e.g. annual report, PBS, and CRIS).  Use KPIs and costing model outputs to support strategic decisions.	Low

 

 

Communication with stakeholders is an essential part of developing the CRIS, with adherence to AMSA’s Statement of Regulatory Approach [17]. 

This updated CRIS is a non-material revision of the 2021-22 Budget CRIS published in July 2021. It consists of 2020-21 audited year-end results, as well as the budget and three forward estimates aligning with the 2021-22 Portfolio Budget Statements. As AMSA engaged with external stakeholders as recently as May and June 2021, and there are no material changes to regulatory charging, no active engagement has been undertaken for this updated CRIS.  

In May 2021, AMSA published a consultative CRIS on its website and invited specific industry groups and participants to comment on its cost recovery arrangements – other groups, owners and operators, and the general public were also able to respond. The consultation was over a three-week period, commencing on 12 May 2021 and closing on 6 June 2021. 

Industry groups invited to provide feedback included: 

• National Safety Committee 
• Shipping Consultative Forum 

Three responses were received, with a key item raised during this consultation period being our levy rates within the various net registered tonnage bands, associated skill involved for different size vessels, and our effort in regulatory requirements 

Following consultation, AMSA responded appropriately to each response received. 

A report detailing all feedback received from stakeholders on CRIS consultations over the previous couple of financial years, including our responses, is published on our website here [18]. This feedback will inform AMSA of potential funding options that may be eventually considered by Government.

Financial estimates for AMSA’s regulatory charging activity outputs budget, and three forward year estimates, is summarised in Table 8, with cumulative results in Table 9. 

Table 8: Financial estimates for regulatory charging activities 

	Budget	Forward Year Estimates
	2021-22  ($’000)	2022-23  ($’000)	2023-24  ($’000)	2024-25  ($’000)
Navigational infrastructure (Marine Navigation Levy)
Expenses (X)	33,526	34,132	34,497	34,891
Revenue (Y)*	36,226	36,625	37,000	37,375
Balance (Y - X)	2,700	2,493	2,503	2,484
Environmental marine protection (Protection of the Sea Levy)
Expenses (X)	26,225	26,999	26,985	27,293
Revenue (Y)*	36,379	36,725	37,100	37,475
Balance (Y - X)	10,154	10,026	10,115	10,182
Seafarer ship safety under Navigation Act 2012 and other Acts (Regulatory Functions Levy)
Expenses (X)	52,112	53,057	53,623	54,236
Revenue (Y)	54,595	55,150	55,700	56,250
Balance (Y - X)	2,483	2,093	2,077	2,014
Marine services under Navigation Act 2012 and ship registration
Expenses (X)	9,684	9,859	9,964	10,078
Revenue (Y)	3,885	3,885	3,885	3,885
Balance (Y - X)	(5,799)	(5,974)	(6,079)	(6,193)
Marine services for National System
Expenses (X)	8,839	8,999	9,095	9,199
Revenue (Y)	3,805	3,805	3,805	3,805
Balance (Y - X)	(5,034)	(5,194)	(5,290)	(5,394)

Table 9: Financial estimates for regulatory charging activities 

	Budget	Forward Year Estimates
	2021-22  ($’000)	2022-23  ($’000)	2023-24  ($’000)	2024-25  ($’000)
Expenses (X)	130,386	132,746	134,164	135,697
Revenue (Y)	134,890	136,190	137,490	138,790
Balance (Y - X)	4,504	3,444	3,326	3,093
Cumulative balance	4,504	7,948	11,274	14,367

As noted, AMSA’s financial estimates provided here do not include the activity output for the National System regulatory-based seafarer and ship safety. Given the upcoming government review of this function, it is not possible to comment on forward years with any degree or level of accuracy, nor without legislative funding provisions. To do otherwise would be confusing and counterproductive to users of this CRIS.

Historical financial performance of AMSA’s regulatory charging activity outputs, from 2014-15 to 2019-20, are shown in Table 10, including explanations of material variances. The cumulative results for regulatory charging activity outputs are included in Table 11. 

Table 10: Historical performance of AMSA’s regulatory charging activities by output 

	2016–17  ($’000)	2017–18  ($’000)	2018-19  ($’000)	2019-20  ($’000)	2020-21  ($’000)
Navigational infrastructure (Marine Navigation Levy)
Expenses (X)	41,134	31,874	35,567	37,164	41,294
Revenue (Y)*	34,091	34,651	36,539	36,281	38,146
Balance (Y - X)	(7,043)	2,777	972	(883)	(3,148)
Explain material variances:	In 2016-17, 2019-20, and 2020-21, provisions for removal of lead paint and asbestos content in aids to navigation sites (predominately lighthouses) were increased as further evidence and substantiation of existence become known. The approximate movement in the provision for 2016-17 was $7.1 million, 2019-20 was $4.9 million, and 2020-21 was $6.3 million. We are working through each of the identified sites through a program of scheduled works to remediate sites and reduce this provision each year.
Environmental marine protection (Protection of the Sea Levy)
Expenses (X)	29,128	30,219	62,707	29,686	25,311
Revenue (Y)*	34,068	36,494	39,234	48,156	49,773
Balance (Y - X)	4,940	6,275	(23,473)	18,470	24,462
Explain material variances:	There are natural timing variances associated with environmental emergencies, as clean-up operation costs are incurred immediately from date of an incident, whereas insurance recoveries or legal settlements typically received four to six years afterwards.  As AMSA has a constructive obligation to meet clean-up costs from ship-sourced marine pollution, in 2018-19 we booked a $27.1 million provision associated with an incident that occurred in June 2018. This clean-up operation finished in June 2020, with actual expenditure of $15.7 million, with excess provision of $11.4 million reversed and recognised as revenue in 2019-20.  In 2020-21 we received insurance recoveries and legal settlements from incidents that occurred in prior years. Further, there was a reduction in crisis preparedness training expenditure and other National Plan related activities as a result of Covid-19 restrictions.
Seafarer ship safety under Navigation Act 2012 and other Acts (Regulatory Functions Levy)
Expenses (X)	38,218	43,142	35,507	50,433	47,343
Revenue (Y)	51,211	52,488	53,470	54,949	56,724
Balance (Y - X)	12,993	9,346	17,963	4,516	9,381
Explain material variances:	In 2016-17 AMSA undertook a workforce planning exercise, building capability to minimise duplication and increase collaboration across domestic and international areas of responsibility. An internal restructure carried out to support a more flexible and responsive organisation, resulting in a notable reduction in staff costs.  For 2017-18 to 2018-19 there was a redirection of resources towards the domestic commercial sector due to unexpected level of transitional workloads associated with full-service delivery of the National System, with 2019-20 reverting back to normal services.  However, in 2020-21 there is a reduction in expenditure predominately related to Covid-19 disruptions and delays for regulatory function activities. We expect this to reverse (increase in expenditure) from 2021-22 as pandemic disruptions largely cease and work-force strategy planning is undertaken to identify the efficient and effective usage of resources in provision of regulatory functions across both domestic and international sector.
Marine services under Navigation Act 2012 and ship registration
Expenses (X)	10,891	5,560	5,995	10,897	9,000
Revenue (Y)	4,849	3,959	3,813	2,959	2,930
Balance (Y - X)	(6,042)	(1,601)	(2,182)	(7,938)	(6,070)
Explain material variances:	An analysis of these under-recoveries indicates that it largely within qualifications for seafarers and pilots, and inspections and surveys on international vessels. We are understanding processes to determine whether costs are efficient or not. Depending on results of this analysis, we will work with stakeholders and government to consider appropriate future arrangements.
Marine services for National System
Expenses (X)	625	867	6,359	7,256	7,772
Revenue (Y)	73	119	3,360	2,988	3,098
Balance (Y - X)	(552)	(748)	(2,999)	(4,268)	(4,674)
Explain material variances:	There are three components driving under-recovery, lower volumes (and revenue) than was originally anticipated, an increase in expected level of service delivery, and temporary inefficiencies as business processes are developed and refined after full-service delivery in 2018-19. The reduction in revenue for 2019-20 is largely the result of bushfire and COVID-19 relief provided to industries.

*  Revenue includes insurance recoveries and legal settlements for aids to navigation assets and environmental emergency pollution responses. In relation to environmental emergencies, there is typically a four to six year delay in incurring expenditure associated with operational costs, which occurs immediately after an incident, and any eventually insurance recovery or legal settlement. 

Table 11: Cumulative performance of AMSA’s regulatory charging activity outputs 

	2016–17  ($’000)	2017–18  ($’000)	2018-19  ($’000)	2019-20  ($’000)	2020-21  ($’000)
Expenses (X)	119,996	111,662	146,135	135,436	130,720
Revenue (Y)	124,292	127,711	136,416	145,333	150,671
Balance (Y - X)	4,296	16,049	(9,719)	9,897	19,951
Cumulative	4,296	20,345	10,626	20,523	40,474

The cumulative balance for regulatory charging activity outputs from 2016-17 to 2020-21 is a $40.5 million surplus. This balance has been used in part to fund the development and implementation of a modern regulatory infrastructure framework applicable for both international and domestic commercial vessels. 

Following two years of detailed activity-based costing and zero-based budgeting exercises, we are progressing over the next few years to understand processes and corporate overheads. As part of the government review, AMSA will develop strategies to address imbalances, with extensive stakeholder consultation on any proposed changes. 

 

Costing outputs through activity-based costing techniques is a powerful tool in management, providing accurate information on the costs of activities and processes in which to make informed decisions. However, it does not provide any in-depth analysis that may be symmetrically tracked (or measured) to assess achievement of predetermined objectives in support of AMSA’s policy outcomes. To achieve a more comprehensive analysis alignment of costing to performance indicators (or targets) is essential. 

Effective performance measurement is key to ensure objectives are met in keeping with stakeholder expectations. Reporting on key performance indicators provides a consistent and repeatable framework to communicate goals, create measurable objectives, and it allows for benchmarking. 

Performance indicators and measurements are based on non-financial, as well as financial information. These can be tricky to develop as indicators are usually confused with business metrics. A relevant performance indicator provides information that is significant and useful to AMSA and its stakeholders, and is attributable to activities. 

In establishing key performance indicators, the SMART criteria is used: 

S Is the goal of the activity specific? 

M Can you measure progress towards that goal?  

A Is the goal realistically attainable? 

R How relevant is the goal to AMSA? 

T What is the timeframe for achieving the goal? 

Overtime, the SMART criteria will be expanded to SMARTER with the additional of Evaluation and Revaluation. These last two steps are important to ensure the ongoing relevance of each measure. 

Measures for 2021-22 

Consistent with the Department of Finance’s Resource Management Guide 131 Developing Good Performance Information, AMSA reviews its non-financial performance measures annually to ensure they remain relevant and fit-for-purpose.  

Our measures are predominantly at an outcome level and measure the achievement of our vision - safe and clean seas, saving lives. 

In 2021-22 this also includes some measures that demonstrate our performance against the three new principles of regulator best practice described in the Department of Prime Minister and Cabinet’s (DPMC) Regulator Performance Guide (April 2021):  

1. Continuous improvement and building trust: regulators adopt a whole-of-system perspective, continuously improving their performance, capability and culture, to build trust and confidence in Australia’s regulatory settings. 

2. Risk-based and data-driven: regulators maintain essential safeguards, using data and digital technology to manage risks proportionately to minimise regulatory burden and to support those they regulate to comply and grow.     

3. Collaboration and engagement: regulators are transparent and responsive, implementing regulations in a modern and collaborative way.    

Currently reported through a separate process, from 2021-22 onwards regulator performance will be an integral part of our overall non-financial performance reporting under the Public Governance, Performance and Accountability Act 2013. This is a transition year, and we will incrementally introduce more regulatory performance measures over coming years.  

We have also included an efficiency and effectiveness measure related to environmental marine protection activity output. We will introduce more of these types of measures as our reporting systems mature. 

To help readers follow year-on-year performance any changes to measures are explained in the rationale and footnotes. 

AMSA is developing a measures library which provides the detailed evidence base for reporting, including measure owners, definitions, targets, tolerances, data sources and calculation methods. 

Non-financial performance measures for regulatory charging activities are summarised in Table 12, broken down by vision outcome level, activity output, and rational and success factors, accompanying a set target. 

Table 12: Performance targets for 2021-22 – regulatory charging activities 

Activity outputs	Measure	Rationale and success factors	Target
Safe Seas – ensuring regulated vessels and seafarers are operating safely and meeting standards
Seafarer and ship safety under Navigation Act 2012 and other Acts (Regulatory Functions Levy)	Safety of foreign-flagged vessels and Australian-flagged vessels (under the Navigation Act 2012) operating in Australian waters is demonstrated through the proportion of very serious incidents total report arrivals1.	Indicates whether standards are being met	≤ 0.5%
Clean Seas – preventing pollution from shipping
Environmental marine protection (Protection of the Sea Levy)	Reducing trend in the number of significant pollution incidents2.	A reducing trend in the number of significant pollution incidents is an indicator of the success of AMSA’s preventative measures across its operation (e.g. ship inspection, safety education, regulation) which all contribute to preventing marine pollution.	Trending towards zero
	Timeliness of response to significant oil spill incidents3.	The time taken to ready AMSA oil spill response equipment and response personnel for mobilisation to a Level 2 (or higher) oil spill incident is an indicator of the effectiveness of AMSA’s marine pollution response arrangements.	Within four (4) hours

Notes: 

1. Marine incidents are classified by AMSA into one of three severity levels: (1) very serious; (2) serious; and (3) less serious. Several factors are considered by AMSA to decide whether an incident is deemed very serious and/or serious. These include, fatalities, serious injuries, loss of vessel, damage to vessel and equipment; serious pollution and other incidents that result in serious consequences (i.e. fire; grounding; collisions etc.) Incidents are categorised individually. 

2. A significant pollution incident is now defined as a Level 2 (or higher) incident in accordance with the National Plan for Maritime Environmental Emergencies. Level 2 incidents are more complex in size, duration, resource management, and risk. Fifteen characteristics that together constitute a Level 2 incident was a more comprehensive descriptor than using a single volume-based data. 

   • Multiple jurisdictions 

   • Some functions delegated or Sections created 

   • Routine multi-agency response 

   • Outline incident plan 

   • Requires intra-state response 

   • Escalated response 

   • Multiple shift days to week 

   • Single hazard 

   • Potential for loss of life 

   • Significant environmental impacts and recovery may take months, with remediation required 

   • Groups of fauna or threatened fauna 

   • Business failure 

   • Ongoing reduced social services 

   • Medium term infrastructure failure 

   • National media coverage 

3. A significant oil spill incident is a Level 2 (or higher) incident – refer to note 2. 

Table 13: Non-financial performance measures for 2020-21 

Environmental marine protection (Protection of the Sea Levy)
Details of key performance measure	Target	2017-18	2018-19	2019-20	2020-21
Reducing trend in the number of significant pollution incidents	Trending towards zero	0	0	0	0
Rationale: A reducing trend in the number of significant pollution incidents is an indicator of the success of AMSA’s preventative measures across its operation (e.g. ship inspection, safety education, regulation) which all contribute to preventing marine pollution.
Analysis of performance: There were no significant pollution incidents during the reporting period.

Timeliness of response to significant oil spill incidents	Within four (4) hours	N/A	N/A	N/A	100%
Rationale: The time taken to ready AMSA oil spill response equipment and response personnel for mobilisation to a Level 2 (or higher) oil spill incident is an indicator of the effectiveness of AMSA’s marine pollution response arrangements.
Analysis of performance: There were no Level 2 spill incidents during the reporting period.

Seafarer and ship safety under Navigation Act 2012 and other Acts (Regulatory Functions Levy)
Details of key performance measure	Target	2017-18	2018-19	2019-20	2020-21
Safety of foreign-flagged vessels and Australian-flagged vessels (under the Navigation Act 2012) operating in Australian waters is demonstrated through the proportion of very serious incidents total report arrivals	≤ 0.5%	0.3%	0.42%	0.19%	1.55%
Rationale: Indicates whether standards are being met
Analysis of performance: Given the apparent rise in the incident rate over the reporting period, AMSA is undertaking analysis to understand the drivers for this trend.

The reporting against these targets will also be contained in our 2020-21 Annual Report. 

The development of key performance indicators for the National System and fee-based activity outputs is continuing through an internal consultative process with business-line managers. The Executive and Accountable Authority will review and approve these prior to holding any consultative process with external stakeholders. Further, as part of the upcoming government review, AMSA will assess and redefine all performance indicators. 

Indicative dates for tasks in preparing the 2022-23 Budget and updates are listed in Table 14 – this does not incorporate the upcoming government review of AMSA’s operations that will involve extensive and comprehensive stakeholder engagement. 

Table 14: Indicative events and forward dates 

Event	Description	Indicative dates
2022-23 Budget CRIS	Develop new costing models for 2022-23 Budget	December 2021 to April 2022
	Publish a consultative CRIS for engagement, including with updates of 2021-22 estimates.	May 2022
	Publish ministerial approved 2022-23 Budget CRIS, incorporating any external stakeholder feedback	June 2022
2022-23 Updated CRIS	Update 2021-22 costing models with year-end results, including non-financial performance measures	July to August 2022
	Publish ministerial approved 2022-23 update CRIS	September 2022

CRIS approval and change registers from 2016-17 to 2019-20 are provided in Tables 15. 

Table 15: CRIS approval and change register 

Date of change	CRIS	CRIS change	Approval	Basis for change
15 Sep 2016	2016-17 National System introductory fees	Publication of 2016-17 CRIS for National System service delivery of introductory fees prior to charging non-government sector	Approved by Minister for Infrastructure, Transport and Regional Development	Initial release
29 Jun 2017	2016-17  Non-National System	Publication of 2016-17 CRIS, updated with 2015-16 audited actual results	Certified by Chief Executive Officer	Updated budget and financial results
27 Jun 2018	2018-19 National System full-service delivery for fees	Publication of 2018-19 CRIS for National System full-service delivery for fee-based activities prior to charging the non-government sector	Approved by Minister for Infrastructure, Transport and Regional Development	Initial release
21 Dec 2018	2018-19	Publication of 2018-19 CRIS updated with 2017-18 audited actual results, incorporating National System introductory fees	Certified by Chief Executive Officer	Updated budget and financial results, incorporating National System introductory fee-based activities
20 Dec 2019	2019-20  Consolidated	Publication of 2019-20 CRIS update with 2017-18 audited actual results, incorporating National System full-service delivery fee-based activities.	Certified by Chief Executive Officer	Updated with financial results and incorporating National System full-service delivery fee-based activities
23 Jul 2020	2020-21	Publication of 2020-21 CRIS updated with estimates for 2019-20	Certified by Chief Executive Officer	Updated estimated budget and current year estimates
4 Dec 2020	2020-21  Updated	Publication of updated 2020-21 CRIS with 2019-20 audited year-end results and budget for 2020-21	Certified by Chief Executive Officer	Revised with audited year-end results and updated budget to align with Portfolio Budget Statements
9 Jul 2021	2021-22	Publication of 2021-22 Budget CRIS updated with estimates for 2020-21	Certified by Chief Executive Officer	Updated estimated budget and current year estimates
6 Dec 2021	2021-22 Updated	Publication of updated 2021-22 CRIS with 2020-21 audited year-end results	Certified by Chief Executive Officer	Revised with audited year-end results

Summary of government policy approval to cost recover, including date of decision, and statutory authority to charge by activity output, with references, is provided below. 

Activity output	Date of decision	Government policy approval	Statutory authority to charge
Navigation infrastructure	11 Sep 1990, reaffirmed on 17 Sep 2018	Implied in second reading of Australian Maritime Safety Authority Bill 1990 [19] and Explanatory Statement of Marine Navigation Levy Collection Regulations 2018 [20]	Part 5, Division 2 of Australian Maritime Safety Authority Act 1990 [21] and Explanatory Statement of Marine Navigation Levy Collection Regulations 2018 [20]
Environmental marine protection	28 Nov 1989	Implied in second reading of Australian Maritime Safety Authority Bill 1990 [19] and second reading of Protection of the Sea (Shipping Levy) Bill 1981 [22]	Part 5, Division 2 of Australian Maritime Safety Act 1990 [21], Section 5 of Protection of the Sea (Shipping Levy) Act 1981 [23], and National Plan [24]
Seafarer and ship safety under Navigation Act 2012 and other Acts	Jun 1989	Implied in second reading of Australian Maritime Safety Authority Bill 1990 [19] and second reading of Marine Navigation (Regulatory Functions) Levy Bill 1991 [25]	Part 5, Division 2 of Australian Maritime Safety Act 1990 [21] and Section 6 of Marine Navigation (Regulatory Functions) Levy Act 1991 [9]
Marine services Navigation Act 2012	11 Sep 1990	Implied in second reading of Australian Maritime Safety Authority Bill 1990 [19]	Part 5, Division 2 of Australian Maritime Safety Act 1990 [21] and AMSA Fees Determination 2015 [26]
Ship registration under Shipping Registration Act 1981	21 Jun 2012	Explanatory statement of Shipping Registration Regulations (Amendment) 1991 [27]	Part 5, Division 2 of Australian Maritime Safety Act 1990 [21], Shipping Registration Act 1981 [10], and AMSA Fees Determination 2015 [26]
Marine services under National System for domestic commercial vessels	2 Mar 2016  And  4 Dec 2017		Marine Safety (Domestic Commercial Vessel) National Law 2012 [28] and Marine Safety (Domestic Commercial Vessel) National Law Regulation 2013 [29]

Principles applied 

There are five principles that support the development of our costing model: 

1. Linked to strategic business planning: costing is not just a ‘bean counting’ exercise. It should be linked to the strategic direction and planning of AMSA, and inform executive at a strategic and tactical level. 
2. Holistic approach: a modelling exercise should include all revenue and operating expenditure, including overheads, other indirect costs, and capital expenditure (capital allowances and/or depreciation). Further, it should focus not just on cost recovery activities, but all activities of AMSA. This will result in a model that can fulfil multiple demands for costing information. 
3. Comprehensive and consistent: a simple approach that applies consistency in the application of modelling rules across all business areas and activities, creating a robust model understood by stakeholders. It should be developed over short timeframes, with a relatively small input of resources. 
4. Flexibility: it is important to recognise that demands for service delivery change over time, driven by various internal and external circumstances. A costing exercise must be dynamic in nature to evolve with changes to AMSA’s business requirements and circumstances. 
5. Institutionalised as a ‘normal’ function: modelling should be a living database that requires regular updating on a periodic basis. This is successful when the model receives official endorsement with AMSA wide involvement (operational area’s ‘buy-in’). Costing will then become a routine task and a ‘foundation stone’ for improving and reporting on financial performance. 

Methodology 

The methodology for modelling AMSA’s costs is summarised in the illustration below. It adheres to activity-based costing principles, which enables more analysis on the efficiency of activity outputs and/or business processes for cost recovery and other activities. It focuses on cost drivers, which allocates indirect costs to direct costs and then to an output.  

Not all business processes are specific or direct in the provision of activity outputs. Several tasks are support related activities that simply enable the delivery of AMSA’s core outputs to stakeholders. Nevertheless, these should form part of the activity cost. 

Cost categories 

As part the costing methodology, we assign each activity to one of the following four cost categories to ensure appropriate identification of overheads for allocation to an activity. 

• Direct: representing direct business processes (or tasks) relevant in service delivery of activity outputs. 
• Indirect: exists to support the delivery of a direct activity. Examples include divisional support activities such as general management, specific ICT costs relating to systems to enable service delivery, and supporting property operating expenditure, ICT networking, and communication. Indirect processes are allocated to direct activities based on a cost object using an appropriate driver.  
• Corporate overheads: enabling tasks and activities to support service delivery of AMSA’s activity outputs through provision of standard corporate and executive functions. Corporate overheads include executive, human resources, finance, governance, and general ICT support, accompanying their respective share of property operating expenditure, ICT networking, and communication. Similar to indirect, corporate overheads allocated to direct activities based on cost drivers. 
• Depreciation: representing capital costs, asset register assessed on an asset-by-asset basis. Where there is a specific direct link to an activity, depreciation is assigned to an activity group, where corporate support related, depreciation is assigned to the appropriate overhead classification. 

Below is an outline of the composition of an activity cost. 

Approach  

As well as the principles in methodology detailed in Appendix 2, an effective model must be: 

• Robust – in addition to the allocation of direct costs, a model must be capable of reliably allocating indirect and corporate overheads to direct activities, 
• Defensible – assumptions and approach applied in determining cost allocations must be clearly documented and capable of withstanding external scrutiny, and 
• Repeatable – model must be capable of supporting a repeatable process in future periods. 

An illustration of the model approach applied in 2021-22 is detailed below. 

Data collection and collation 

The typical approach is to use data collection systems, such as timesheets, to gather information about drivers and use this for the allocation of costs to activities. AMSA does not currently collect timesheet data. Instead, the approach applied in 2021-22 is to use a data collection template with direct input from each business line area manager. 

Managers assigned staff and employee costs (based on ASL equivalent grades), and supplier costs to activities and activity groups. During this data collection phase, managers provided: 

• reasons why AMSA performs the activity, including how it is funded, 
• whether the activity is ongoing, commencing, or terminating, 
• description of activity drivers, including expected volumetric data per annum, expected impacts (risks, quality, benefits, service levels…etc.) for scenario levels,  and justification for using the driver, 
• risk assessment, identifying risk of not performing the activity, and 
• corporate focus area aligning with Corporate Plan [30]. 

Overhead model 

The collation of data collection templates determined direct costs for each activity output. To calculate fully absorbed costs of an activity output, an attribution of indirect and corporate support costs to each direct activity based on drivers is required. The overhead model applies several cost drivers. 

Allocation of indirect support costs 

Activity groups are used to assembly similar activities for the purposes of allocating indirect support costs to direct activities. There are two levels of activity groups to provide options in accurately assigning costs: 

• Activity group 1 – set at the highest level at which common activities can be identified. 
• Activity group 2 – sets a lower level to allow for a more targeted approach to overhead allocation. It also allows for activities to be split between international and domestic industries. 

Currently, indirect support costs are assigned to direct activities using direct ASL of that respective activity group as a cost-driver. The model has the flexibility to assign dollar values to specific individual activity groups. However, at this stage, ASL deemed the most appropriate as costs are influenced by the number of staff. 

Where costs are incurred solely to support a specific group of activities, such as ICT hosting and support of software, the activity group is used to assign costs – as illustrated below. 

The following indirect costs have been allocated in the model utilising activity groups: 

• Support activities (excluding corporate overhead functions) required for the delivery of a group of activities, such as divisional management and administrative costs, 
• Depreciation costs for assets that directly support a group of activities, and 
• ICT operating expenditure on projects and systems that directly support a group of activities. 

Property operating expenditure 

Given its role, AMSA operates at numerous locations throughout Australia, leasing offices and storage facilities, as well as owning eight remote residential properties and one regional office. This corresponds to a sizeable property footprint and associated operational expenditure. 

Property operating expenditure for office leases and residential properties are allocated by aggregating costs by location, and then directly allocated to each business line area in proportion of the respective number of staff and contractors utilisation that location – below is an illustration of this process. 

Property operating expenditure for direct activities, such as aids to navigation sites or leasing space for National Plan stockpiles, are allocated directly to their respective activity outputs. 

Corporate overheads 

Corporate overheads allocated to direct activities using several cost drivers, depending on the nature of the expenditure, detailed below. 

Overhead category	Allocation method	Rationale
Executive functions	Dollar cost (direct + indirect)	Dollar costs appears the most reasonable given executive functions focus on strategic and risk, which is usually dictated by expenditure.
Human Resources (HR)	ASL	Cost and resourcing of HR functions heavily influenced by volume of staff that are supported (e.g. payroll, recruitment, training, and performance management).
Finance	Dollar cost  (direct + indirect)	Primarily focused on areas of higher spend and risk. A higher cost requires ongoing financial management arrangements.  While dollar cost for the allocation method is not a perfect cost driver, it provides a more accurate allocation than simply using ASL.
Governance	Dollar cost (direct + indirect)	Focuses effort on organisational priorities and risk, with corporate planning the output. Strategically important activities receive additional management and analysis compared to lower risk (and generally lower cost) activities.  ASL deemed unreasonable as governance function activities are not influenced by the number of staff.
ICT general (excluding directly attributed activities)	ASL	Driven by the volume of staff and contractors supported (e.g. issuance of computers, help-desk requests, telephony and communications costs).

Attribution of costs to non-regulatory charging activities 

Staff providing regulatory charging activities may also undertake other activities funded by either government budget appropriations (search and rescue coordination services and regulatory function National System activities) or Australian Government agencies for targeted externally funded maritime related programs. 

Costs for non-regulatory charging activities are identified during the collection and collation phase by direct input from business unit managers, with indirect and corporate overheads treated in the exact same manner as regulatory charging activities. This holistic approach (mentioned in Appendix 2) ensures a comprehensive model fulfilling multiple demands for costing, with no risk of omitting any costs from total activity outputs. 

Sensitivities 

Cost drivers and assumptions underlying the modelling are developed to limit and constrain any significant sensitivity from changes in demands of regulatory charging activities. Nevertheless, it is recognised that costs are sticky in the short-to-medium timeframe, predominately consisting of contracted suppliers and staff. 

Supplier costs are largely longer-term contracts where expenditure relates to service requirements or deliverables. These are generally not dynamic or responsive to short-term changes in demand of regulatory charging activities. Staff costs have a similar constraint for short-term movements and are based on long-term expected time and effort requirements to meet policy outcomes to an acceptable standard, as identified by business unit managers. 

In determining the staff and supplier cost levels, AMSA forecasts the expected level of demand for regulatory charging activities as part of its annual budgeting processes. This process is based on historical data and trends, consultation advice, understanding known economic factors, and thorough communication with principle stakeholders. Although, externalities, such as COVID-19 disruptions, trade disputes, or austerity measures may impact resourcing and service delivery. 

Fees under Navigation Act 2012 and other Acts 

A schedule of the fee-based regulatory charging activities are listed below, with reference to Australian Maritime Safety Authority Fees Determination 2015 [26]. 

Charge	Type	2020-21	2021-22
Services to seafarers and coastal pilots
Examinations and assessments
Assessment of sea service for an:  certificate of competency as master, deck office or engineer, or  certificate of recognition of a certificate of competency as master, desk office or engineer.	Fixed fee	$168	$168
Oral examination for certificate of competency	Fixed fee	$544	$544
Computer based examination for certificate of competency	Fixed fee	$220	$220
Assessment of marine qualifications for immigration	Fixed fee	$472	$472
Undertaking a psychometric assessment	Variable	External provider cost
Written examination of theory or charts for coastal pilot’s licence – standard examination	Fixed fee	$544	$544
Written examinations of charts for coastal pilot’s licence – Whitsundays	Fixed fee	$816	$816
Oral examination for check pilot licence	Fixed fee	$816	$816
Certificates for seafarers and pilots
Initial issue of certificate of competency or proficiency	Fixed fee	$190	$190
Initial issue of certificate of recognition or competency or proficiency or certificate of equivalence	Fixed fee	$190	$190
Revalidation of certificate of competency o certificate of recognition or proficiency or certificate of equivalence	Fixed fee	$136	$136
Endorsements to active certificate of competency	Fixed fee	$112	$112
Initial issue of, or revalidation of, Global Maritime Distress and Safety System (GMDSS) competency certificate or certificate of recognition of GMDSS certificate	Fixed fee	$112	$112
Issue of initial coastal pilot’s licence of reissue of coastal pilot’s licence	Fixed fee	$150	$150
Issue of compass adjuster licence	Fixed fee	$190	$190
Issue of certificate of safety training	Fixed fee	$112	$112
Issue of certificate of proficiency as Marine Cook	Fixed fee	$112	$112
Additional charge for transmission of documents other than by regular mail, such as fax, email, or registered mail:  within Australia  outside Australia	Fixed fee	$40  $80	$40  $80
Inspections and surveys
Vessel design and performance—tonnage measurements and loadline
Provision of copies of tonnage calculations	Hourly rate	$272	$272
Inspections and certification for tonnage measures and loadline	Hourly rate	$272	$272
Inspections of vessels and equipment
Approvals and exemptions for a vessels, materials handling equipment or loading or unloading arrangements for a vessel, and, for second and subsequent visits, inspections of vessels, equipment, or arrangements for these matters	Hourly rate	$272	$272
Survey for initial issue or reissue of a certificate	Hourly rate	$272	$272
Follow-up visits to re-inspect deficiencies identified at initial inspections	Hourly rate	$272	$272
Other services and inspections of vessels and equipment	Hourly rate	$272	$272
Cargo inspections and approvals
Visits to vessels or loading facilities for inspections to ensure safe loading and stowage of grain	Hourly rate	$272	$272
Inspections, determinations, approvals, and exemptions for solid bulk cargoes	Hourly rate	$272	$272
Inspections, determinations, approvals, and exemptions for dangerous goods	Hourly rate	$272	$272
Inspections, certifications, approvals, and exemptions for transportation of livestock, including inspections and services for issue or endorsement of an Australian Certification for the Carriage of Livestock	Hourly rate	$272	$272
Inspections and approvals of containers for authorisations to load or unload where container is unsafe or overloaded or lacking a valid safety certificate plate or after expiry of the examination date	Hourly rate	$272	$272
Miscellaneous inspections that are compulsory, requested by the recipient, or follow-up inspections to confirm corrective action	Hourly rate	$272	$272
Other marine services
Determinations, declarations, exemptions and approvals
Determination (other than a manning level determination), declaration, exemptions, or approval	Hourly rate	$272	$272
Services relating to manning levels
Determination of manning levels	Fixed rate	$1,088	$1,088
Review existing approved manning levels	Fixed rate	$544	$544
Services relating to the international safety management code
Document of compliance or safety management certificate, including conduct initial audit or for reinstatement of document or certificate	Hourly rate	$272	$272
Scheduled periodic compliance audit relating to continuation of document of compliance or safety management certificate	Hourly rate	$272	$272
Services to pilotage providers and coastal pilotage exemptions
Licence as provider of coastal pilotage services or for reinstatement	Hourly rate	$272	$272
Scheduled compliance audit of accredited provider of coastal pilotage services	Hourly rate	$272	$272
Exemption of vessel from coastal pilotage requirements	Hourly rate	$272	$272
Exemption of seafarer from coastal pilotage requirements for exempt vessel	Fixed rate	$136	$136
Services to registered training organisations
Approval of training course	Hourly rate	$272	$272
Schedule periodic compliance audit of approved courses provided by registered training organisation	Hourly rate	$272	$272
Services to providers of vessel traffic services
Authorisation to provide vessel traffic services	Hourly rate	$272	$272
Conduct scheduled periodic compliance audit of provider of authorised vessel traffic services	Hourly rate	$272	$272
Shipping registration
Applications for registration or re-registration
Registration of ship required to be registered	Fixed fee	$2,664	$2,664
Registration of ship, other than Australian owned ship, on demise charter to an Australian based operator	Fixed fee	$3,996	$3,996
Registration of ship permitted to be registered, other than foreign owned ship on demise charter to an Australian based operator	Fixed fee	$1,554	$1,554
Transfer or transmission of ownership
Registration of transfer, transmission of ownership, for ship required by to be registered	Fixed fee	$777	$777
Registration of transfer, transmission of ownership, for ship on demise charter to Australian based operator other than an Australian owned ship	Fixed fee	$1,332	$1,332
Registration of transfer, transmission of ownership, for ship permitted to be registered, other than foreign owned ship on demise charter to an Australian based operator	Fixed fee	$444	$444
Grant of certificate
New registered certificate	Fixed fee	$222	$222
Provisional registration certificate	Fixed fee	$333	$333
Extension of period of currency of provisional certificate	Fixed fee	$222	$222
Grant of temporary pass	Fixed fee	$333	$333
Certificate of entitlement to fly Australian national flag or red ensign	Fixed fee	$222	$222
Supply deletion certificate	Fixed fee	$111	$111
Administrative services
Exemption from registration	Fixed fee	$666	$666
Request for change of name of registered ship	Fixed fee	$111	$111
Request for change of home port of registered ship	Fixed fee	$111	$111
Request for extension of time for lodging documents	Fixed fee	$167	$167
Additional charge for transmission of documents other than by regular mail, such as fax, email, or registered mail:  within Australia  outside Australia	Fixed fee	$40  $80	$40  $80
Inspections and searches
Search by staff of Australian Shipping Registration Office of register - for each period of 15 mins or remaining part	Fixed fee	$55.50	$55.50
Certified extract of register or of document forming part of or associated with Register	Fixed fee	$75	$75
Certified copy of register entry	Fixed fee	$40	$40
Certified copy of documents forming part of or associate with register - for each page	Fixed fee	$21	$21
Caveats
Lodgement of a caveat	Fixed fee	$222	$222
Services relating to a continuous synopsis record
New continuous synopsis record	Fixed fee	$555	$555
Reissue of continuous synopsis record	Fixed fee	$170	$170
Amendments to existing continuous synopsis record	Fixed fee	$390	$390
Other services
Any service not listed elsewhere	Hourly rate	$272	$272
Any service for which AMSA bears a direct expense	Variable	Direct expense

Fees under National Law (National System) 

In accordance with Clause 52 of the Marine Safety (Domestic Commercial Vessel) National Law Regulation 2013 [29], annual indexation shall apply to specified fees contained within the provisions. This is a mandatory legislative requirement. 

The indexation factor is 1.1% for 2021-22, with an effective date of increase being 1 July 2021. 

Charge	Type	2020-21	2021-22
Certificate of survey
Certificate of survey
New certificate of survey	Fixed fee	$378	$382
Renew an existing certificate of survey	Fixed fee	$212	$214
Vary an existing certificate of survey#	Fixed fee	$196	$198
Voluntarily suspend a certificate of survey	Fixed fee	$214	$216
Replace a certificate of survey	Fixed fee	$37	$37
Unique vessel identifier
Unique vessel identifier	Fixed fee	$164	$165
Certificate of operation
Certificate of operation
New certificate of operation	Fixed fee	$200	$202
Renew an existing certificate of operation	Fixed fee	$200	$202
Vary an existing certificate of operation	Fixed fee	$187	$189
Voluntarily suspend a certificate of operation	Fixed fee	$214	$216
Replace a certificate of operation	Fixed fee	$37	$37
Certificate of competency
Examinations and assessments
Conduct an examination	Fixed fee	$351	$354
Certificates of competency, near coastal
New certificate of competency, near coastal:   - Coxswain grade 1   - Coxswain grade 2   - General purpose hand   - Marine engine driver grade 2   - Marine engine driver grade 3   - Master inland waters   - Master less than 24 metres	Fixed fee	$155	$156
New certificate of competency, near coastal:   - Engineer class 3   - Marine engine driver grade 1   - Master less than 35 metres   - Master less than 80 metres   - Mate less than 80 metres	Fixed fee	$267	$269
Renew an existing certificate of competency, near coastal:   - Coxswain grade 1   - Coxswain grade 2   - General purpose hand   - Marine engine driver grade 2   - Marine engine driver grade 3   - Master inland waters	Fixed fee	$142	$143
Renew an existing certificate of competency, near coastal:   - Engineer class 3   - Marine engine driver grade 1   - Master less than 35 metres   - Master less than 80 metres   - Mate less than 80 metres	Fixed fee	$225	$227
Vary an existing certificate of competency (i.e. remove a restriction, add an endorsement, change of name)	Fixed fee	$142	$143
Replace a lost, stolen or destroyed certificate of competency	Fixed fee	$142	$143
Other marine services under National System*
Accreditation application fees
1 to 5 categories of surveying	Fixed fee	$1,495	$1,511
6 to 10 categories of surveying	Fixed fee	$2,292	$2,317
11 to 16 categories of surveying	Fixed fee	$3,089	$3,123
Renew existing marine surveyor accreditation	Fixed fee	$271	$274
Replace lost, stolen or destroyed accreditation card	Fixed fee	$49	$49
Vary an existing accreditation	Fixed fee	$280	$283
National Law exemptions
Scheme non-survey (Exemption 2)	Fixed fee	$189	$191
Operation beyond survey time (Exemption 6)	Fixed fee	$230	$232
Temporary operations permit (Exemption 7)	Fixed fee	$298	$301
Class C restricted operations (Exemption 40)	Fixed fee	$326	$329
Exemption from the application of the National Law or specified provisions of the National Law	Hourly rate	$246	$248
Approval under a Marine Order or an equivalent means of compliance	Hourly rate	$246	$248