With all due respect Mick, and I dont doubt the problems you face, I think the problem lies a lot deeper than just Gen Y attitudes and stick and rudder issues.
Ive worked in both fields extensively, GA instruction and GA Charter- they are both drastically different jobs, and both take time to adjust to. I think a bigger problem is the CASA system, and that the training standards have gotten away from the practicalities of becoming a proficient pilot and have been replaced by a cover their arse legally type of system. Airmanship is barely mentioned (unless its in Jargon that sounds impractical), and it comes down to the individual instructor as to whether all those intricacies that create a true "airman" are passed on. Most of the time, new instructors are just hard pressed to get through the syllabus, and are more concerned about things that in the larger scheme of things, wont matter til much later on in the students career.
Things that regularly get missed: flying on attitudes and Power settings. Not trimming, concentrating on things inside the cockpit, not looking outside, not getting a "feeling" for aircraft performance. the inability to create space in the circuit, Poor approach profiles, poor flare attitudes, Fear of xwinds.. etc etc etc.
Almost all of these issues are easily rectified by experienced instructors, but its usually not done until its too late. At the nav level, you often are still dealing with simple flying errors, and this takes away from the mental capacity to navigate.
I also think that the sausage factories, like any other flight training organisation, will have a mix of quality in staff, however the student doesn't get the choice of who they fly with, and may often get stuck with the worst of the worst for the most important phases. In an aero club, if an instructor isnt effective or doesn't get results, students will choose someone else through word of mouth.
I think that the only way to have it fixed is for the industry to respect instruction and pay instructors more to stay in the field. Its not respected(even within instruction in many cases), and its treated as a stepping stone by the majority which lowers standards again cos their just biding time.
Fee-help is for the most part, bad for the industry, as there are people training out there who never see a dollar change hands, and never really understand the anxiety of having to work hard enough not to screw anything up. I did so much work on the ground particularly during PPL, because I simply couldn't afford to F#ck it up. There's an influx of pilots who just don't get that.
What we need is people to stay in instruction, or to do it part time along with their other jobs and Some sort of scenario where companies/individuals get rewarded for being involved in mentoring.
Its easy to sit there and say its all gone to crap, but I doubt that many pilots are anywhere near as good as they think they for the first few years anyway. if you've ever instructed, and then sat in aircraft with pilots who have only chartered, you can see the bad habits, and most charter pilots would say that most instructors are too slow and careful, but it depends on the individual. I always made a point of getting out in WX down to the legal minimums even with newish NAV students, because I figured they'd learn a lot more to see it with the safety of a more experienced pilot by their side than to be exposed to it first time on their own with someone else's life in their hands.
In charter obviously you need to know where the next "out" is, and when thats passed, where the next one is and so on. i don't see that it would be so hard on an industry level to have those kind of techniques included in the syllabus..
I don't really know what the answer is, but generally speaking instructors leave the industry just as they become effective leaving many who will never make it anywhere else and hate it, and junior instructors. The industry as a whole needs to act to ensure that senior instructors are paid a lot more to stay because for most its just not a realistic career long term.