Performance Review Commission, and performance management of the European ATM system Keith C. Williams, Chairman PRC

Origin of performance review 1997: European ATM Institutional Strategy Moving from solutions-based to performance-oriented strategy Includes the creation of a strong, transparent, independent European performance review and target setting system Performance Review Commission (PRC) advises on ATM matters Performance indicators Proposed performance targets Guidelines for economic regulation Incorporated in EUROCONTROL Revised Convention 1998: Creation of PRC (12 independent members) Supported by permanent Performance Review Unit (10 p) 2004: Performance Review is part of Single European Sky regulations

Role of Performance review Feedback information for policy makers, ANS management, stakeholders Closes the performance loop Least intrusive form of regulation

PRC documents Performance Review Reports Demand for ANS: Traffic Provision of ANS Safety Capacity/Delays Flight efficiency Cost-effectiveness Special items ATM Cost-Effectiveness reports (ACE) ANSP Benchmarking Factual data Cross-ANSP comparisons Trend analysis Special reports E.g. Fragmentation, Civil/Military 37 States 9.6 M flights

How the PRC analyses ANS performance Performance Indicators Performance Drivers Capacity Delays Safety Flight Efficiency ANS Key Performance Areas ANS Performance Ground Delays Aviation performance Accidents Incidents Traffic demand Capacity Airline Performance Airport Performance Horizontal Flight efficiency Vertical Flight Efficiency Airspace design & use Civil/Military use of airspace Safety maturity Legislative, Cultural Env. Safety Management Productivity Support Costs Complexity Fragmentation Cost Effectiveness Other costs (12%) ATCO Unit Costs ANSP costs (88%) Cost of living

Safety Agreed performance objectives Number of accidents, severe incidents shouldnt increase Interim target: agreed safety management maturity in all States/ANSPs by end 2008 Mechanisms to deliver performance Regulations: In place; complete and uniform application is an issue Safety management: Maturity improving Progress to date Many actions in progress Incident reporting Information flow to be firmed up Legal and cultural impediments Key Performance Indicators being developed Limited trend information Severe incidents dont appear to increase

ATM capacity and delays Focus on ground delays Airborne delays assessed under flight-efficiency Agreed performance objectives Sufficient [en-route] capacity to accommodate demand in typical busy hours ATFM En-route delay < 1 min/flight (near optimum) Performance management Capacity planning and management coordinated through EUROCONTROL Magnitude ATFM delay cost: En-route 550M, Airport 500M Progress to date ATM-related delays: 21% of Air transport delays Major improvements since 1999, but challenge due to sustained traffic growth Main Issues Matching capacity and demand efficiently Main issue is airport capacity (outside ATM) Managed by ATM: 21% Key Performance Indicator

ATFM Delays: Target setting Trade-off delay/cost of capacity Target setting based on understanding of optimum

Flight Efficiency No agreed performance objective yet Safety remains paramount Trade-off with capacity Progress to date Coordination of airspace design & use under EUROCONTROL Focus has been on capacity so far Very slow improvement in flight efficiency Magnitude Economic impact of Route extension ~ 2 200M p.a. Direct link with environmental impact (Emissions) Vertical and terminal airspace inefficiencies to be added Issues to be resolved Flight-efficiency is a major ATM issue Airspace design is the main underlying issue Continental dimension of airspace design issues Civil-military aspects PRC uses same framework as ANSEP Key Performance Indicator Actual Route (A) Great Circle (G) Direct route Extension Direct Course (D) TMA Interface Route Extension A DG 30 NM

ANSP benchmarking First PRC report in 2003 Requires Information disclosure Validation Stability in time Institutionalised benchmarking Voluntary benchmarking ANSEP performance framework draws on PRC experience PRC uses same framework as ANSEP

PRC proposed target: -3% p.a. in real unit cost terms Mechanism to deliver performance User pressure, PRC benchmarking Co-ordinated planning under EUROCONTROL States, ANSP initiatives Progress to date Progressive improvement in unit cost since 2003 > 2 billion euro saved from 2003 to 2008 if trend remains Break in trend coincides with first benchmarking report Unit cost approximately twice higher than in US Main causes Low average productivity Fragmentation of service provision Weak governance of monopoly ANSPs in many States Magnitude High cost of user charges (7.2 billion euro in 2005) In spite of progressive improvements, Cost-effectiveness is a major ATM issue (billions of euro) Cost-effectiveness Key Performance Indicator

Conclusions High stakes in ANS performance (billions of or $ per annum) Experience with performance-oriented approach in Europe since 1998 Prerequisites for efficient performance-oriented strategies Reliable information flow Target setting, performance monitoring Adequate regulation Performance management processes Independent performance review (with permanent support) Strong governance of monopoly service providers Accountability for performance