SMS Overview

The Civil Aviation Authority (CAA) is in the process of implementing new requirements for safety management systems for all operators. Safety Management Systems (SMS) are required to cover hazard identification, risk assessment and mitigation, safety monitoring, and ongoing training and communication about safety issues. Second tier operators must achieve full compliance by 2015 and third tier operators must achieve full compliance by 2016.

The introduction of SMS will inevitably involve costs, but questions operators must consider include:
  • What is the benefit of not doing anything about SMS vs. the costs to your operation if an emergency situation or event does occur?
  • What is the cost if your operation is forced to suspend operations due to an inquiry for audit purposes?
Ultimately, all parties with access to airside activities will be required to be SMS compliant in order to obtain the certification necessary to continue operation.

What is SMS?

SMS is a formal organization tool for managing safety. It is a shift in focus from the relatively static Quality Assurance (QA) requirements currently employed to a more proactive approach that involves the industry in providing more of an educational approach to safety. This includes formal accountability resting with a senior person in a company (most likely the CEO), an educational programme providing regular training to employees, information sharing between operators and CAA, and ongoing monitoring of safety. Operators are also expected to have conducted proper hazard assessments, evaluated mitigation measures from the perspective of human and financial risk, developed response plans where appropriate, and to review the assessments on a regular basis. Some of these requirements will involve relatively minor changes to existing procedures, while other requirements will have a more major impact.

Who needs to do this?

Any organisation certified under the Civil Aviation Rules (CARs) must become SMS compliant. This also applies to support and third party contractors. CAA has classified operators into three groups:
  • Group 1 consists of airlines operating large and medium aeroplanes, maintenance organisations providing services to Group 1 airlines, aerodromes, and air traffic services;
  • Group 2 includes the majority of general aviation, including helicopters, airlines operating small aeroplanes, maintenance supporting other than Group 1 airlines, aviation training, aircraft design and manufacturing, recreation, telecommunications services, meteorological services, and aeronautical information services;
  • Group 3 includes all remaining operations including agricultural aircraft operations and service organisations such as aviation security.
Rule amendments for Group 1 came into force in 2010, with full compliance required by 2014. Group 2 operators are required to have a Safety Management System that is to be fully compliant by 2015. Group 2 operators should begin transitioning their systems now to minimise the disruption and cost to their operations: a series of incremental steps will deliver a better quality system at lower cost than a “big bang” change left to the last few months before mandatory compliance.

Why do we need to do this?

Pursuant to its obligations under the convention of International Civil Aviation (which forms part of ICAO), as of January 2009 New Zealand was required to comply with a set of prescribed standards and recommended practices regarding safety management. The intent behind this is to raise safety standards by moving from a system that is focussed on a reactive (post-event) approach to safety management to a proactive system that aims to minimise safety risks before events happen. Of more direct relevance to industry it is critical to have a safe operation to provide confidence and credibility to the public, which is necessary for staying in business. Recent accidents in the adventure tourism industry have highlighted the potential for operators to be held liable if accidents occur when a reasonable culture of safety management could have prevented those accidents. It is reasonable to expect that the same issues of liability will increasingly fall on aviation organisations.


CAA has specified a list of mandatory items that must to be covered in your systems:
  1. Management commitment and responsibility, with the CEO made accountable for safety and responsible for ensuring that all necessary resources are made available for safety management;
  2. The specification of safety accountabilities resting with the key safety personnel (including the CEO);
  3. Appointment of key safety personnel, typically being a safety manager;
  4. Co-ordination of emergency response planning between all parties involved on an aerodrome, including air traffic control, airline operations, air traffic service providers. The co-ordination between parties must be described in each party’s safety manual;
  5. SMS documentation;
  6. Hazard identification;
  7. Safety risk assessment and mitigation;
  8. Safety performance and monitoring and measurement;
  9. The management of change;
  10. Continuous improvement of SMS;
  11. Internal audit programme (similar to the current QA requirements);
  12. Management review (similar to the current QA requirements);
  13. Training and education, so that all employees receive regular training in safety awareness and the organisation’s safety plans; and
  14. Safety communication to ensure that critical safety information is communicated to employees, and so that employees understand the safety imperative behind any organisational or procedural changes arising from SMS.

Costs to Industry associated with the introduction to SMS

SMS is intended to build upon existing safety management practices, yet it will inevitably result in additional costs to industry. These costs must be balanced against the costs of safety incidents. Costs will include:
  • Direct costs: Development of manuals such as: training manuals for general safety and for the organisation’s SMS, hazard identification and mitigation manuals, risk management procedure manual, induction manual for new employees. Development of assessments to test employee understanding and awareness of safety issues and safety management. Designing and implementing procedures, staff training, and potential increases in numbers in personnel.
  • Indirect costs: Such as certification, updating company manuals and expositions, meeting reporting requirements and CAA charges for approving SMS manuals.
  • Continuing costs: These will arise particularly from ongoing education programmes, but may also arise from increased level of internal audit/review and regulatory oversight. This may also include re-submitting documents to CAA in the case of a failed audit.