Cost of Instructor Rating

[Time will tell]

@ JADP

As i mentioned it is fair to add an amount for administration. But $7000 is ridiculous.

In a previous life I was heavily involved in the RTO process and am well aware of what is required. As a club member i have seen the work done to get the approval. The driving force behind the price hike is from one person only. We both know who that is.

I wonder if he still charges $200 to add a PIFR to an IFR flight test. The candidate only needs to write "Please issue the PIFR based on my MECIR" casa will issue the PIFR for the sticky label fee of $50-

TWT

[propelled]

Its a joke basically.
As if anyone would accept paying $29k for the course when it can be done for half that, unless they r suckers.. Each to their own, thats the free market aye!

[glenb]

I can assure you that the margins on the instructor rating are very very tight. One of the reasons that less schools offer the instructor rating. A previous post suggests 150 hours of theory which is accurate but to suggest $1500 for that is quite unrealistic. A grade one instructor would probably earn about $30 an hour for the 150 hours. A total of $4500 plus add on another $500 for super and payroll tax. The school then decides they want a modest cut for the 10 week course of $100 per week. There is your $6000 plus the 30 hours at the dual rate and another 20 hours mutual at half the solo rate. At he end of 10 weeks work, supplying the building, classroom, facilities etc we may get $1000. Hardly gouging.

[The Kelpie]

Glen

That assumes 1 on 1 instructor/student ratio. We all know that theory is hardly ever done in this manner.

Further the number of theory hours you have quoted is not all face to face.

More to Follow

The kelpie

[Woodwork]

Far be it from me to go against the grain, but...

If you're picking where to do your instructor rating based on internet research and cost alone, without ever bothering to visit the facilities or at least speak to their past customers, I'm not sure I'd care to hop in an aircraft with you and be taught, well, anything. Will you send me around for another go at that PFL because I was a shade too high, or will you glance at your watch and think "that's another 0.1 I'm not getting paid for, let Darwin sort him out"?

Headline price is only part of the picture. Factor in the quality of instruction and facilities, future employment opportunities and school reputation, the fleet you'll use and its relevance to the types you'll actually fly, etc.

If you're still coming up with one place being considerably poorer value than others, then fine, but use caution reaching that conclusion based on price alone.

Re FEE-HELP, there is no 20% loading (whoever mentioned that may be confused about a discount for up front payment), but it is indexed annually, usually in excess of CPI. Given the typical GA pilot salary means it's likely to be five years or more before you commence repayments, the cumulative effect of that indexation can mean the dollar value you repay is higher than if you'd borrowed from a bank in today's dollars, where future inflation will reduce and not increase your debt. Sometimes it's worth cross-shopping FEE-HELP with a student loan if you're eligible.

[The Kelpie]

Originally Posted by Woodwork

Re FEE-HELP, there is no 20% loading (whoever mentioned that may be confused about a discount for up front payment), but it is indexed annually, usually in excess of CPI.

I think you may be mistaken, this is an extract from the government's study assist website (http://studyassist.gov.au/sites/studyassist/helppayingmyfees/vet-fee-help/pages/vet-fee-help)

Is there a loan fee?

There is a loan fee of 20% for some VET FEE-HELP loans, depending on where you are studying. The loan fee does not count towards your FEE‑HELP limit.

You will incur a 20% loan fee if you are a full fee paying student.

You will not incur a loan fee if you are studying as a subsidised student in a reform state or territory. Currently, Victoria and South Australia (as of 1 July 2012) are the only reform states for the purposes of VET FEE-HELP.

More to Follow

The Kelpie

[Woodwork]

Thanks Kelpie, I was unaware of that. It's either new or not applied to every course, since I did not incur it with UNSW. If it applies here, then it makes (IMHO) FEE-HELP even less attractive than it previously was.

If you're going to commence your career beholden to someone, Wayne Swan is probably the worst possible choice

[The Kelpie]

I agree woodwork!

[swh]

Let me guess the pay for instructors has not kept up with the cost of getting the qualifications.

[Time will tell]

@glenb

Glen as usual your input is valued.. Given you are on the other side of the fence in relation to this, what do you beleive a fair price is for an Instructor rating..

Now I can assure you that the course is not done 1 on 1. I am told there will be 4 on each course.

Going by your web site $17,500 for a course seems to be industry standard and im certain no one would or could accuse you or price gouging.. This thread relates to the school accross the road to you charging $7000 more than you.

The question is. Is the RVAC price gouging because they are offering it through Vet FEE Help.. No one else in Victoria YET can offer Vet FEE Help for the instructor rating.. Sure this will be short lived, i am aware of a number of schoolS that are working on their application as we speak..

They are also charging nearly $8000 more than you for the MECIR.

Added to these is the cost of the flight test and the requirement to become a member of the club which could be close to another $1000- ontop of the initial $24,000 plus the 20% fee making both the instructor rating and mecir both cost over $30,000 each.

I have been in contact with DEEWR and the VRQA and they are both looking into this situation.. The initial responce was that industry competition would allow people to choose. With ZERO competition at the moment, thats not happening.

Lets see how this goes..

TWT

[MakeItHappenCaptain]

No one else in Victoria YET can offer Vet FEE Help for the instructor rating.

BMSA? Or is that only for the CiR?

[glenb]

Instructor rating cost

Ok here is a very realistic breakdown of the cost of an instructor rating.

The charge to the customer was $16500

35 hours at the solo rate $238 dollars. $8330
15 hours at the solo rate $119 ( two trainees sharing 50 percent each)$1785
Casa applied test fee plus aircraft for 1 1/2 hours $1000
Theory component about $5385 per candidate to cover the Grade One.


The wages cost for a course of 11 weeks at $1500 per week for a quality grade one to run the course will be $16500.

Working on three candidates on a course that leaves a margin of 3 x students contributing a theory component of $5385each = $16,155. Pay the grade one $16,5000 and you have nothing left over.

Get 4 on the course and you might make about $5000. Still have to allow for that instructors annual leave, and trust me the expenses of running a flying school are horrendous.

You might argue that the school also picks up a double dip on the aircraft

After the aircraft, fuel, oil, landing fee, maintenance etc is left over there is about $50 per flight hour left over for the flying school. We still have to pay the other expenses that are not directly related to the flight. I.e. land lease, office staff, stationery, insurance, Internet, refurbishment, fees etc.

Unfortunately these days a well run instructor rating is expensive to deliver and ties up resources that could be directed elsewhere. Schools are steering away from the instructor rating and this will be a trend in times ahead.

[avi8r330]

I am also in the process of researching FIR costs.

I have noticed that Oxford (Oxfraud) has recently jacked up their FIR price from $18,800 to $23,850 without any notice.

Oxford blame this price hike on a new CAAP (5.14-2(0)), which according to them requires an additional 3 hours dual flight instruction, 36 hours flight mass brief instruction, and 2 hours of pre-flight and post-flight briefing.

Is this correct? I couldnt find anything about this on the CAAP.

This increase of hours will bring the ground theory hours to 183 hours.
Does this sound reasonable to anyone?

I am struggling to get any straight answers from Swinburne or CAE Oxford about the $5k price hike.

I also noted that their price increased on the same week the fee help limit increase was announced.... coincidence or not?

Thanks

[Time will tell]

Thanks Glenn

From what you have broken down would a more reasonable price in the vacinity of $19,000 to $20,000 be fair.

I dont knock a business from making profit.. I do wonder about not for profit flying club though.. Yet its a NOT FOR PROFIT flying club that is charging the $24,000, clearly by your breakdown making a PROFIT.

Anyone out there know much about tax law.. Being a not for profit CLUB, they are exempt from many taxes, yet unless the CP is taking a tidy profit himself, it seems the club is making profit. A call to the ATO tommorow may clear this up.

One of the Instructors told me the CP used to come in on his days off to run the PMI and charge a massive amount per student to the club.. Dont know if this is still happening.

I know from the Instructors that they are being paid award ONLY, not a cent more. One of the boys mentioned he wasnt being paid for the time in the office, was expected to be at work so he could pick up any walk ins etc.. But unless he flew he didnt get paid.. Im not sure if this is industry standard or not.. Must be hard being a casual flight instructor.

Glenn, is the cost of a grade 1 you mentioned at $1500 per week, award.. Im guessing that would be close by the time you take into account super and costs associated with staff ?

[Time will tell]

MakeithappenCaptain

Sorry i just saw your question.

Im not sure, it was the RVAC that told me they were the only Victorian flight school able to offer the Vet FEE Help..

TWT

[just a dumb pilot]

Time will tell!
I understand that "the Club" had its AGM just recently and it reported a substancial financial loss.

The not for profit is a two edged sword as these organisations don't pay tax on profits (surpluses) but are unable to pay dividends or distribute surpluses.
They do pay GST,payroll tax,rates,workcover etc.

They can't claim depreciation or any other deductions including repairs.

Most of these organisations are also required in the event of closure to pay all of thier funds into a similar type of not for profit organisation. The members get zip.

Being a not for profit organisation doesn't mean that everything is done at a loss because if it was the directors who are not paid for thier services would be liable.

The Club has the reporting liability of a public company which includes audited accounts and full reporting.

[Seabreeze]

When you pay for a plumber or builder you pay for their travel time, their tools, depreciation of plant, super, sick pay, salaries, workers comp, office costs, phones, heating, internet, rental of business premises, accountants, interest on capital loans, etc.

Consultant engineering or law firms typically charge salary x 3 ( or thereabouts) as a way of recouping such general admin oncosts, with real estimates of plant, equipment, ops, etc on top.

Does anyone think that such oncosts are not incurred by flying schools or clubs as well?

Simplistic calculations of costs such as those that appear above probably don't account for anywhere near the real cost.

Airlines return a poor profit on capital, and so do most flying schools. Why? they are run by economic simpletons with huge egos who think a +2% return on capital is fantastic if they can get it, but forget to add in all the other hidden costs. (Well I suppose a 2% return is better than a -2% return!).

Maybe you can ride QAN.AX up with Singo, Gregg, Dixon and co, but watch the bucking horse, it could throw you.

Meanwhile if you can get a reasonable instructor and aeroplane at a reasonable rate, don't quibble, grab both - probably someone else is subsidising your training!

cheers

Seabreeze

[training wheels]

When the cost of an instructor rating starts to reach the 25K mark, then you'll start to get only those who really do wish to become instructors doing the course. This is not a bad thing in IMO, as it would weed out those who only get an instructor rating to build hours.

There are lots of foreign guys in Asia with a new CPL/IR at the moment paying that kind of money for a jet or turbo-prop rating with line training included and I'm not talking P2F. They go through the usual process of applying for the airline, interview, psychometric testing, sim evaluation etc. When accepted, they are on the payroll, but fork out 25K for type rating and line training.

[peterc005]

My suggestion is to do the instructor Rating at the place you are most likely to get work. Even better, sign up for an Instructor Rating on the basis of getting work on completion.

[Jack Ranga]

Peter, is that really a good idea? What if the candidate is a dud? But you've promised them a gig on completion.