Partial cost recovery for launch and return applications

The government has agreed to introduce partial cost recovery arrangements for space launch and return applications.
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Image credit: Digital Earth Australia

The government has been reviewing cost recovery arrangements for assessment of applications made under the Space (Launches and Returns) Act 2018 (the Act); consistent with the government’s Cost Recovery Guidelines. It has agreed to introduce partial cost recovery arrangements.

This updates arrangements for fees as set out in the Space Activities Act 1998 (the 1998 Act), and detailed in the Space Activities Regulations 2001.

Work within the Agency is not expected to be cost recovered, while work performed outside of the Agency is expected to be cost recovered. This means that the most frequently assessed applications (Overseas Payload Permits) are not expected to attract a fee. Assessments likely to be cost recovered would involve complex applications, requiring consideration by a technical expert contractor, ensuring activities are as safe as reasonably practicable. To support these assessments, the Agency is working towards lifting in-house capability, including recruitment of staff with specific expertise.

The Act also includes a mechanism for the Minister to waive fees. Arrangements for waivers will be considered during the development of the rules for fees, which could include consideration of support for innovation in the sector.

Fees will not be introduced before 1 July 2020. Prior to the introduction of the partial cost recovery arrangements, the Agency will undertake consultation on the draft rules for fees prior to commencement of charging. Consultation is expected to include:

  • when partial cost recovery will likely be applied
  • the amount of a fee and/or a way of working out the fee
  • timing for payment
  • circumstances in which a fee may be wholly or partly waived

Consultation is expected to be undertaken in March and April of this year.

The charging of fees for space activities is not new, and was set out in arrangements under the Space Activities Act 1998 and Space Activities Regulations 2001. As Australia develops a world-class regulatory system, the Agency remains focused on enabling entrepreneurship while ensuring national safety and security. The above arrangements represent a balance of encouraging innovation in the sector, while ensuring relevant costs are cost recovered from industry consistent with the Government’s Cost Recovery Guidelines.

The implementation of a partial cost recovery model comes at a time when the government has invested $629 million since 2018-19 to grow the industry, including:

  • the Space Infrastructure Fund, to fill gaps to help businesses and researchers to participate in the global space economy
  • the International Space Investment initiative, providing grants for projects to enable Australia’s participation in international space agency activities
  • Moon to Mars investment, unlocking opportunities across the supply chain that will deliver positive outcomes for industry, local and regional economies and boost national GDP

The charging model will be reviewed in 2022–23 to ensure arrangements are appropriate.

More information on the public consultation will be provided through the Australian Space Agency newsletter and social media when available.

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