The CASA test form, requires that the candidate is capable of operating ALL of the operational equipment fitted to the aircraft.
I agree that basic (DR) nav skills will and are declining as more automation is creeping into the cockpit.
However ALL navigation skills need to be taught to and learnt by the students.
The emphasis of most instructors will always be on the basics (fall back skills) but the instructors job is to teach ALL the required skills to do the job. Nowdays the average light twin and big singles are equiped with TSO'd GPS or GPS/COMM/NAV units, the larger trbo props (Metros aside) are standard fitted with GNSS/RNAV capable units with system intergration (FMS or AIR data Computers). One of the main tasks of the Training captains nowdays is teaching the CORRECT use of such systems. With the modern light singles now coming out of the factory or retofitted equipment available for hire and training, this type of training should be done at the PPL/COMM NAV stages.
As one poster pointed out that it is easy to make a mistake with button pushing and or data entry, it is TRAINING at the appropriate stages that will reduce this error and improve safety.
richo