Unfortunatly it is not a case keeping their instructors sharp its more a case of 46+ instructors trying to do renewals on 4 servicable aircraft on a good day plus keep the program ticking along on a 7 day roster.....
The guys who use it are kept current... which i guess is fair enough seeing phase 1, 2 and 3 are VFR instructors.
Instructor rating renewals are done in the grob so there's no drama there. As for the ungrades, as old mate ITS said its all based in seniority but there are sufficient grobs around that they will give you one (at a good rate) to do your upgrade with. It works well for everyone... you get your upgrage and pay rise. The upgrade process the compnay imposes is quite stringent as will take months to complete, so going outside is always good for your career progression.
Good luck with you and keep know to Peter. There is always movement just dont be to disguntaled and keep working at it.