RAAus AGM This Saturday at YLED Lethbridge Victoria

[DonRamsay]

Whether you print 11,000 or 12,000 copies, the total cost is not much different. But, if you get down to low numbers the cost per copy becomes prohibitive.

 

For my money, I can't see the value of printing the Members Market any longer. By the time the magazine is printed it is well out of date and it's available on the web in a better presentation.

 

Before we go knocking off printing we would need to be sure the advertisers are happy about it. Being distributed for free on the net is the best way to get it most widely read by the people we want to read it . . .younger people to replace us in time.

 

 

[Geoff13]

Whether you print 11,000 or 12,000 copies, the total cost is not much different. But, if you get down to low numbers the cost per copy becomes prohibitive.For my money, I can't see the value of printing the Members Market any longer. By the time the magazine is printed it is well out of date and it's available on the web in a better presentation.

 

Before we go knocking off printing we would need to be sure the advertisers are happy about it. Being distributed for free on the net is the best way to get it most widely read by the people we want to read it . . .younger people to replace us in time.

I agree with the members market comment.

 

However the best way to get it read by this person who wants to read it is to provide it in printed form.

 

Cheers Geoff13

 

 

[DonRamsay]

When people sue, they go looking for who has deep pockets. As such, people who sue RA-Aus are always going to join CASA as a co-defendant.

 

Keeping a big cash reserve to pay off lawsuits just sets you up for a fall.

 

The building is a form of financial reserve that could be borrowed against if we ever got that desperate.

 

Under no circumstances EVER should RA-Aus even think about owning an airfield or building or buying hangars. We have enough trouble running the bit we have without adding those responsibilities to the mix. And who ever made a quid out of running aviation businesses?

 

 

[rhysmcc]

I'm guessing the members market is a large part of the magazine income, something along the lines of $30 per ad each issue?

 

Using the figures quoted, say the mag costs $60 per member per year, say a move to digital costs $10 per year per member, that $50 saving should be split between investing for the future and reduced member fees. Ie a $25 reduction in fee. For those who want the printed copy, subscribe for $50 per year.

 

I think Russ is on the money though, our biggest cost is staff, about $1.2million. If we can invest now to reduce that in the future by moving from paper to more automated online systems, needing less clerical staff to process forms, renewals and registrations. Together with stream lining the magazine, if possible so it makes a profit as a monthly mag, or maybe a quarter edition with monthly newsletter style editions.

 

If we really want to start saving money and cutting back or streamlining, we need more information then we have now. We need to know exactly how much is getting spent on what. For example, how much is spent on aircraft registration related matters, how much on pilot certificate issuing, how much is on auditing flight training schools. I think ASIC was one of the areas highlighted that was costing us money, is that something we really need to be doing?

 

 

[Guest Maj Millard]

The size of the cash/asset reserves are irrelevant unless there is a strategy and business plan defining what the reserves should be. Too little and there is the risk of not being able to pay bills/liabilities, too much and the members are paying too much for the services they receive. If operational costs exceed operational revenues then the reserves are just being depleted and measures should be taken to address this. If reserves are used to reduce operational costs in future years then that could be a good investment in the future running of the business.The talk of legal cases being the reason for the reserve needs to be addressed in the business case and adequately allowed for in the insurance coverage as well as the reserves rather than retain and build up reserves “just in case”.

A lawyer would be better qualified to comment but in my experience in another high risk recreational industry where legal cases are fairly common - the instructing and certifying bodies needs to demonstrate that the course curriculum and standards are appropriate, the instructor/examiner needs to demonstrate that they have followed the curriculum and standards (no more – no less) and the participants need to demonstrate that they acted within the privileges allowed in the standards. If all is met with no negligence as a reasonable person would, then there is no case. Having been intimately involved in a coronial case where this was tested, the civil case was closed without issue because each party was able to demonstrate they complied with the standards and test of what a reasonable person would do in the circumstances.

 

Insurance should be used to manage the liability risks and pay the legal costs required to demonstrate this in court. Holding a reserve just in case of legal action is self insurance and generally a doubtful practice unless there is a strong case for it and intimate knowledge of what may happen. If the board is not confident in the pilot certifying or aircraft licensing process/standards then it needs to address this rather than just squirrel money away just in case somebody were to take RA-Aus to court.

 

The business plan should address all of (and more):

 

· What should the reserves be $1m or $10m?

 

· How much insurance should be held?

 

· What are the incomes and expenses for the business and how do you make sure incomes are higher than expenses?

 

· How should RA-Aus invest the reserves in better systems, building, airfield or hanger?

 

Operationally, the RA-Aus administration team needs to take care of the systems, process and standards to deliver on the strategy and business plan whilst working within the income/expense constraints.

 

As I asked earlier – who does the CEO and board work for? It was a rhetorical question; I know the answer was the members. It is obvious this has not been the case for a number of years and there have been some genuine attempts recently at fixing this with new appointments but the fact that RA-Aus is a member association should never be lost on the CEO and individual.

O1rmb, I heard every word of that and I agree with you on a lot of it . I for one have stated before that I am on the board for two reasons....the membership and the health of the organization...period. I will be at the strategy meeting in Canberra in a couple of weeks , and I will take some of your points with me for consideration...thanks for your valuable imput.......Maj....

 

 

[coljones]

If we really want to start saving money and cutting back or streamlining, we need more information then we have now. We need to know exactly how much is getting spent on what. For example, how much is spent on aircraft registration related matters, how much on pilot certificate issuing, how much is on auditing flight training schools. I think ASIC was one of the areas highlighted that was costing us money, is that something we really need to be doing?

Agree.

Is the rank and file asking for reduced fees or are they asking for more detail about how the fees are spent?

 

I don't have a problem in paying for what I get but I am a bit concerned that we are pushing to build a war chest (slush fund) with no indication as to why, for what purpose and how much. It seems to me that the $2.5 mill was plucked out of the air because it seemed like a good idea at the time. We do have a building we can mortgage if push comes to shove. RAA is operating as a monopoly among people who have, in the main, a few bob. If they allow RAA to go to the wall they have aircraft that, in all probability, not fly again. That will focus their minds. If I were a bank I would have no hesitation in lending RAA money given its assets and access to a continuing sizable cash stream.

 

 

[rhysmcc]

Indeed, it's good to have the cash with a plan (i.e. investment for the future). The idea of having it ready to pay for lawsuits doesn't sit well for me, but I don't really know what we are being sued for or what we likely can be sued for in the future (i.e. what neglect has been made and kept hush).

 

It would be great to strive to lower membership fees and I believe is reflected in our mission statement (To foster, encourage and develop safe Recreational Aviation in Australia with minimum bureaucracy* and minimum cost). Right now I think the discussion is more about our we can prevent the fees having to go up to pay for the increase in expenses over the last couple of years, however any strategic plan should have the mission statement in mind, part of that in my opinion is keeping costs to members down.

 

 

[Powerin]

I too think it is a mistake having a legal warchest...but I might be wrong. An incorporated association's funds are public knowledge. Is it not the case that a litigant will only bother to sue if they know that funds are available to win? As has been mentioned before, self insurance is probably a mistake because you could never really afford the cost of fighting a court case and the cost of a judgement against you could you?

 

As for the magazine, I wonder how much could really be saved going digital? I admit, despite having had computers since 1982 and being on the Internet since 1996, that I still prefer printed magazines. How much income do we get from advertisers to offset the cost of printing? One thing I notice from the digital versions of newspapers and magazines is the distinct lack of mainstream advertising. How many of our advertisers would stick with our magazine in digital form? I know I would have second thoughts about the cost effectiveness of advertising in a digital format if I were an advertiser. Like Coljones, I am willing to pay for the printed mag, but I would accept a digital magazine if the membership costs were brought down.

 

There was a comment previously about needing cheaper magazine advertising rates for members. This is a nice concept, but I suspect nearly all of the advertisers are members anyway. You can't, on the one hand, complain about the cost of the magazine but then on the other hand complain about the cost of advertising which helps pay for the magazine. It is not the job of RAA members to pay extra to help other members make a profit from their business.

 

 

[rhysmcc]

There's no mention of any income from the magazine in the budget, does RA-AUS even profit from ads or is it only the publisher who collects that and then charge a printing fee per copy to RA-Aus?

 

It is not the job of RAA members to pay extra to help other members make a profit from their business.

Although we do seem to do that for flight training schools, another reason why we need more detailed break down. How much is spent administrating the schools and what income is collected other then new memberships? (Not saying it's wrong but you need to do what activities are costing and what are producing income)

 

 

[facthunter]

I am sure the information you seek is readily available . All this stuff is discussed all the time. Advertising income comes off the cost of the magazine and could (in theory) even make a profit. Having appropriate adverts benefits the reader too in some cases, but if the industry is not powering on all this activity is more subdued. Sponsoring an organisation like us raises the issue of "not biting the hand that feeds you" I'm suggesting nothing at all just talking principles. The "Members funds" are not profit not are they likely to unduly influence the organisation away from it's proper duty of acting in the members interests. Nev

 

 

[Guest Maj Millard]

Gentlemen, in respect to a 'slush' fund ( Cols back to that).......or a 'fighting ' fund. Unless you've had you head firmly planted in the sand you would have noticed that in the past 12 months we have had several fatal accidents, including a couple of high profile double fatals.

 

In a couple of cases the passengers involved ( non- members) have kicked off possible lawsuits against somebody, or everybody. It's just how things go these days, Relatives or family will sue at the urging of their representation. ( generally money hungry layers who love and thrive on these cases). Generally the lawsuits don't fly (sic) until after the findings of the Coroners inquests, whose findings can be way off the actual mark at best, as we have found in the past.

 

Often the RAA is named as a litigant, and regardless of the final outcome it still takes heaps of cash to properly defend our position in court. The RAA has good legal representation and we have a good history of defending ourselves properly in court.

 

Often with Coroners inquests etc these cases don't rear their ugly heads for some years after the actual event. We do of course need a cash reserve on hand to defend our interests when required, or to satisfy any judgement against us, or negotiated settlement if that is required, as has been the case recently in a couple of cases.

 

Obviously if all of you out there flew much safer and didn't creat these problems for us , we would no doubt be in better shape, but unfortunatly that hasn't been the case as the recent crashes in the past six months has shown.

 

Alternatly if one of you is an attorney qualified to protect our interests and wants to do it at no cost, then I'm sure the office would be happy to hear from you. Otherwise we are going to need an ongoing large cash reserve/slush fund/ fighting fund.

 

 

[turboplanner]

I am sure the information you seek is readily available . All this stuff is discussed all the time. Advertising income comes off the cost of the magazine and could (in theory) even make a profit. Having appropriate adverts benefits the reader too in some cases, but if the industry is not powering on all this activity is more subdued. Sponsoring an organisation like us raises the issue of "not biting the hand that feeds you" I'm suggesting nothing at all just talking principles. The "Members funds" are not profit not are they likely to unduly influence the organisation away from it's proper duty of acting in the members interests. Nev

If it's so readily available cut the waffle give us the figures then.

 

 

[Guest Maj Millard]

If it's so readily available cut the waffle give us the figures then.

I believe the financial report was released recently ?......have a read.

 

 

[facthunter]

Turbo... Sorry . I will decline that. Nev

 

 

[rhysmcc]

I believe the financial report was released recently ?......have a read.

I've had a read and it doesn't include the details, it has summary of information and total figures but I can't seem to find where for example it says $X was made from magazine advertising, $Y was spent on printing, $W on delivery, $Z on editor/staff payments. The same can for most of RAA operations, ie $A is spent administrating pilot renewals, $B is spent on aircraft registration etc etc.

 

Now it may be argued members don't need to know all the little details, the summary is fine. But my question is, does ANYONE know these details? If we are serious about cutting expenditure we need to know what activities is the money being spent on and is it been spent well.

 

I'm happy to have Maj the benefit of knowing if we need the "legal fund" or not, as he would be more privy to knowing what wrong doing or negligence has been made that we will have to pay for in the future. I just hope these issues have been addressed so no future incidents can make the same claim.

 

 

[Russ]

If........if, there was questionable decisions / actions, why the damn coverup. This festering topic keeps on popping up. ( ie....last paragraph above post )

 

Someone in authority, catagorily dismiss this, or release the facts. ( FOI could be in play here ?? )

 

If........there is substance to the matter, it tarnishes later officials into the mix as to knowledge of matters, and perpetuating silence.

 

So.....debunk it, or release the information.

 

On another note.....why try to reduce "fees" they are bugger all now. ( get smarter at using them )

 

" hull" insurance for EVERY member, that would be good. ( group policy )

 

" public liability insurance " .....every member again policy. ( more and more local athorities are getting into this demand. )

 

These insurances are available now, singularly to you / me, not cheap tho, but a group thing could be way better.

 

 

[rankamateur]

Russ, I absolutely agree with your comments about insurance. A individuals we have but one option with insurance cover, ... bend over and assume the position!

 

 

[rhysmcc]

If........if, there was questionable decisions / actions, why the damn coverup. This festering topic keeps on popping up. ( ie....last paragraph above post )Someone in authority, catagorily dismiss this, or release the facts. ( FOI could be in play here ?? )

If........there is substance to the matter, it tarnishes later officials into the mix as to knowledge of matters, and perpetuating silence.

 

So.....debunk it, or release the information.

 

On another note.....why try to reduce "fees" they are bugger all now. ( get smarter at using them )

 

" hull" insurance for EVERY member, that would be good. ( group policy )

 

" public liability insurance " .....every member again policy. ( more and more local athorities are getting into this demand. )

 

These insurances are available now, singularly to you / me, not cheap tho, but a group thing could be way better.

If you come out and said you were negligent, you are opening yourself up to massive legal suits for anyone who may have been wronged by it, that's the only reason why I can see it wouldn't be public (or member knowledge).

 

The only reason why I suggested reducing fees is to counter the loss of the magazine subscription (from paper to online) as a suggestion. Also need to keep in mind you are competing now against the RPL which costs $50 once, granted hiring of aircraft is generally more. I'm happy to keep paying the RAA membership but not for just the privilege to fly (which i can do without RAA) but for the extra benefits it can provide (ie insurance, cheaper aircraft ownership/hire). However why should the 10,000 pay for the hull insurance for the 3000 aircraft owners? Where would a pilot see the savings of this insurance (ie will hire fees come down, i doubt it.)

 

 

[facthunter]

User pays is well understood by the management. It is already in the various category of membership structure. It is a bit of a no brainer for a fairness argument.

 

One way or another the careful pilots will pay for those less careful. If a good deal is negotiated with some insurance mob you would (I imagine) still negotiate a different policy for each person. I've always found they want to know your experience and accident history. You may also only choose to insure hull damage on the ground, as an example, and tailor your policy to your own risk assessment.

 

Hire costs are subject to competitive pressure at the end of the day, but any extra costs imposed have to be passed on, usually. Any savings made MAY be passed on. depending on the market. Nev

 

 

[rhysmcc]

Yes, something along the lines of what SAAA have (ie 10-20% discount on premiums) would make more sense for individuals to make their own policy.

 

If a collective hull insurance was possible, the cost would need to be absorbed into the aircraft registration fee rather then the membership fee.

 

 

[SDQDI]

Ok first let me say these last few pages are awesome:thumb up: Nice robust discussion without serious personal insults. This is exactly the sort of conversation that is actually constructive.

 

In regards to the magazine I wonder if now we are getting emails that the magazine and emails could work in conjunction with each other, for example instead of a magazine each month have it each quarter and in between include any 'timely' (stories or articles which need to be out there, events, Operational concerns ect) stories of interest in a monthly email. I'm not an expert when it comes to members market but maybe that could be all online and only the planes that aren't sold could be included in the quarterly magazine? That way we are only printing four times a year which would save us 8 issues straight off the bat, although maybe being quarterly the magazine might need to be half as big again?? But that should still save us the cost of four issues per year? Not sure if my head sums are right but if it was costing us 30k per issue that would save over 100k on its own.

 

Personally I like the paper mag and wouldn't mind paying a little more for it but I think that we should look at other options first.

 

Keep up the constructive posts people:thumb up:

 

 

[Guest Andys@coffs]

My personal views....our membership base should be used to leverage buying arrangements, but........at no time should any transactional load be placed on the RAAus staff, we can barely do what we have to now and don't want any additional staff to be required to bring us these arrangements. As such to me licensing and registration activities remain as they are, members will use the arranged deals if they are of financial advantage to the members, and if not they will ignore or do their own thing.... Ultimately each year or 2 of our group arrangement we will get a view from the supplier (was it good for them, did they get as many members to participate as they expected) and also we will via regular survey and 2 way communication ask the members was it good for them......if not we know we need to revisit...... Hull insurance is generally a percentage of hull value, and as such is a variable amount between the member and the uinsurer, don't see why RAAus would want to insert itself in the loop...Ideally RAAus may well be able to charge the provider a commission for each deal arranged, In that way its good for all

 

Andy

 

 

[Russ]

Raa has 3000 reg flyers ( aircraft )

 

Raa approaches insurance co's....X , Y ,Z

 

Gentlemen, Please give us a quote to hull insure $50...60...70...80...90...100k aircraft

 

BTW gentlemen, there is the potential for 3000 new policies.

 

Now.....if this scinareo does not get their attention, I'll be gobsmacked.

 

A commission to Raa.....why not

 

Same scinareo for public liability insurance.

 

 

[Oscar]

Andy, the call has been on for the development of an integrated business process management system based on a whole-of-enterprise, web-enabled relational database structure that would remove a vast amount of the routine transaction processing load from the staff, for at least a year or more. I am sure that you have a very good understanding of what that entails - including the fact that it cannot be accomplished by piecemeal system development but MUST be done according to an overarching IT development strategy so that all 'modules' integrate seamlessly, utilising one master data field definition structure - not something that is cobbled together post-hoc from individual modules gathered from disparate sources a la Peoplesoft.

 

People need to remember that RAA exists to be an interest-group-centric agent of CASA (which is, for better or worse, the authority that has been mandated by legislation with the authority and responsibility for aviation safety in Australia). It enjoys monopoly status for certain classes of aircraft entirely due to CASA accepting that monopoly status - but please note that CASA has stated that it is not bound to eternally continue to support a monopoly should that be found to be ineffective in exercising the delegation it has from CASA for its operations.

 

The idea that RAA is a 'club' - a 'band of siblings' - united in a common love for all things that the RAA seeks to be, is comprehensively dismissed by the low voter turn-out for Board representation. I don't have the interest to do the numbers, but I suspect that an audit of the total number of members who voted for every position currently occupied on the Board would be somewhere of the order of 25% - 33% of the total membership? Perhaps someone else can tally up the numbers, but I think it would be found that more than half of the 'membership' of RAA have basically no interest in RAA per se - they would subscribe to any service provider that allows them to fly legally and safely in their small aircraft. Should CASA endorse a 'competitive' commercial service that meets that basic requirement at a lower cost than RAA, it is reasonable to postulate that membership might well hemorrhage .

 

Fanciful? I suggest you contemplate on the idea that CASA might - just might - revise its maintenance authorisation requirements such that a suitably-trained and 'qualified' RPL-qualifying aircraft owner could do her/his own basic maintenance on her/his RPL-qualifying aircraft. What's your best guess as to how many defectors from RAA would happily hang letters on their aircraft if that makes a practical reduction in the administrative cost of their flying?

 

RAA HAS to be a 'service' first and foremost and an 'organisation', secondarily. I should add that I whole-heartedly endorse the role of RAA as an advocate for small-aircraft operation, which needs an advocate in such areas as support for the maintenance of regional airfields, access to airspace, promotion of the wider social acceptability of RAA-class operations etc. However, those are 'value-added' components for RAA membership that are certainly worth member $$ - but it remains that RAA needs to discharge its responsibilities as an 'accredited' agent of CASA in the most cost-effective and efficient manner possible.

 

Continuing to operate with labour-intensive (and audit-indefensible) manual systems is simply not a viable option for RAA. What I would seek is an indication that RAA has both realised AND planned for a move to a viable system of business processing that is consistent with modern practice.

 

 

[Guest Andys@coffs]

Oscar

 

No Arguments from me, when you see the board motions from the last board meeting (my first) you will see that stage 1 (requirements definition) is funded and starting. Tony King and myself are both IT Department players for many years, I have a history of ERP implementations with Oracle ERP so know only too well that you will do requirements definition at some point, early or late, but the clock countdown to delivery doesn't start until its done, while the cost counter starts immediately as you know! So you can do it expensively in a single pass or horrendously expensively in multiple passes.......

 

We will not proceed pass stage 1 until we are very clear on what it is that is to be delivered.....ala PM101

 

Andy

 

P.S I believe the board motions will be published in the next day or so......