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

Policy makers

Policyobjectives Achieved

Performance

LegislationInstitutions

Industrial Organisation

Air Navigation

ANS ProvidersSupervisory authorities

Common functions

Airspaceusers

Airportoperators

PerformanceReview

Advice on performance

issuesPerformance information

Consultation Raw

information

Policy makers

Policyobjectives Achieved

Performance

LegislationInstitutions

Industrial Organisation

Air Navigation

ANS ProvidersSupervisory authorities

Common functions

Airspaceusers

Airportoperators

PerformanceReview

Advice on performance

issuesPerformance information

Consultation Raw

information

Policy makers

Policyobjectives Achieved

Performance

LegislationInstitutions

Industrial Organisation

Air Navigation

ANS ProvidersSupervisory authorities

Common functions

Airspaceusers

Airportoperators

PerformanceReview

Advice on performance

issuesPerformance information

Consultation Raw

information

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

www.eurocontrol.int/prc

37 States9.6 M flights

How the PRC analyses ANS performance

Performance Indicators

PerformanceDrivers

CapacityDelays

Safety

FlightEfficiency

ANS Key Performance

Areas

ANSPerformance

Ground Delays

Aviation performance

Accidents Incidents

Traffic demand

CapacityAirline

Performance

Airport Performance

Horizontal Flight efficiency

Vertical Flight Efficiency

Airspace design & use

Civil/Military use of airspace

Safety maturityLegislative, Cultural Env.

Safety Management

Productivity

Support Costs

Complexity

Fragmentation

CostEffectiveness

Other costs (12%)

ATCO Unit Costs ANSP costs (88%)

Cost of living

Safety

Agreed performance objectives “Number of accidents, severe incidents shouldn’t 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 don’t appear to increase

ATM capacity and delays

1.3 1.41.21.83.13.65.54.12.9 1.2

-1

0

1

2

3

4

5

6

1997 1998 1999 2000 2001 2002 2003 2004 2005 2006

min

utes

per

flig

ht

-1 000

0

1 000

2 000

3 000

4 000

5 000

6 000

Flig

hts ('000)

En-route ATFM delay per flight (May-Oct.)

Airport ATFM delay per flight (May-Oct.)

En route target En route

optimum

Target: 1.0min/flight

Actual: 1.4min/flight

Summer (May-October)

source : EUROCONTROL/CFMU

0.8 0.9 0.8 0.9 0.7 0.6 0.6 0.7 0.9 0.8

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)

Primary delay (2006)

79%12%

9% 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 ExtensionA

DG

30 NM

0

10

20

30

40

50

60

2004 2005 2006 2007 2008 2009 2010

rout

e ext

ensio

n (k

m/fl

ight

)

Direct en route

TMA Interface

Proposed target

- 2 km per f light

ANSP benchmarking

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

0,4

0,5

0,6

0,7

0,8

0,9

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

P

2007

P

2008

P

2009

P

2010

P

Eur

o 20

05/ k

m

100

130

160

190

220

250

Cost Per Km Total Costs (1997= index 100) Traff ic (1997=index 100)

Average 1997-2003

PRC proposed target

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