Regional Air Route Viability Still Very Much At Risk

Senator Rex Patrick.
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4 years ago
Regional Air Route Viability Still Very Much At Risk
Senator Rex Patrick
Centre Alliance Senator Rex Patrick is calling out the error in the claims the Coalition Government is making in support of 'leaked' news that $100 million will be provided to regional airports in Tuesday’s budget for upgrading runaways and attracting commercial flights into country areas.

"Whilst I am in favour of the Federal Government assisting councils upgrade their airports, it misses a fundamental issue that must be resolved if some regional air routes are going to survive, let alone thrive," said Rex.

Deputy Prime Minister Michael McCormack has said that the infrastructure upgrades, to be funded over four years, would allow more flights in and out of rural cities. “We want more people, especially families and small businesses, moving to and staying in the regions, and better connectivity through airports is a vital part of that plan,” Mr McCormack said.

"But his statement ignores the real consequences of an earlier regional airport security announcement', said Rex.

In May 2018, the Coalition Government announced a budget allocation of $50.1 million to upgrade security at regional airports through the installation of body scanners and advanced x-ray equipment. This coincided with a proposal to mandate the screening of regular public transport flights carrying 40 passengers or more. This will affect Qantas and Regional Express (REX) Airlines' flights out of regional airports such as Whyalla and Port Lincoln.

In offering to pay for the security equipment the Government has ignored the very significantly ongoing costs of operating the new security equipment, estimated in a Departmental submission to a Senate Inquiry on 'air route service delivery to rural, regional and remote communities' to be between $530,000 and $760,000 per annum. This cost will have to be borne by either increased regional council rates or increased ticket prices.

The ongoing Senate Inquiry into regional airfares has received strong evidence that increased passenger fares ultimately lead to a decrease in passenger numbers and have even been the cause of people deciding to leave regional areas.

Rex Airlines told the told the Senate Committee on 24 July last year:

I think the best thing I can say to that is that if all regional airports were required to provide security and the airport operator had to fund the operation of that airport security, check bags and passenger screening, probably half of our routes in the country would become unviable overnight, and then you've got to ask yourself the question: if then the overhead of the company has to be carried by half of the routes, then that starts to make those viable ones suddenly unviable because the overhead is going to be a heavier burden on them.

Qantas also told the Committee on 15 March this year:

Like all of the costs we've talked about, airport charges and others, on relatively marginal routes, there is always a tipping point. In the South Australian market, where we operate two Dash 8 Q300 50-seaters to Port Lincoln, Whyalla and Kangaroo Island, the impost of additional security charges to the level that you have described we think would be critical, in that it would move us beyond the tipping point of viability and put those services at risk.

"Regional air services are the lifeblood of regional, rural and remote communities. It is critical for the general community for access to medical care, educational services, small business and to encourage tourism," Rex said.

"Centre Alliance is calling on the Government to treat national security costs as exactly that - national. It should not be for regions to bear a disproportionate share of the cost of security from terrorism or other threats."

"This most recent announcement is a ruse when it comes to supporting better connectivity through regional airports," said Rex. "It's great that the Government intends to assist councils in airport upgrades, but they should not ignore the rather large flying elephant in the room; regional airport ongoing security operating costs".

"If they're aiming to improve regional air connectivity, they've missed the landing spot," said Rex.
Infrastructure Regional Development