Airline relief

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Airline relief

Rex Airlines has received a lifeline from the Federal Government, in the latest move to safeguard regional travel, including in the Limestone Coast.


Regional Express went into administration in July last year with estimated debts of $500m. 


The airline immediately cancelled its services between capital cities, however flights from to and from regional centres, including Mount Gambier, have continued.


The regional services were saved after the Federal Government announced it would guarantee regional flight bookings for Rex customers throughout the voluntary administration process.


While the process continues, the government has now taken steps to ensure Rex Airlines regional services will continue, supporting the administrators on next steps.


Late last week the government acquired $50m of debt from Rex’s largest creditor, PAGAC Regulus Holdings Limited (PAG), in a bid to prevent an adverse outcome for regional communities, such as liquidation, and ensure the continued connectivity of Australia’s regional and remote communities.


By acquiring the debt, the government has become the principal secured creditor and will seek to become a voting member of the Committee of Inspection.


Whilst the accelerated initial sale process undertaken by the administrators in mid-2024 did not find a suitable buyer for the airlines’ regional operations, the government has continued to work closely with the administrators through the extended convening period.


Federal Transport Minister Catherine King said the debt acquisition made clear the government’s ongoing commitment to maintaining access to aviation services for regional and remote communities, and recognised the critical role of the Rex network to local economies.


“This announcement builds on previous action, including the Albanese Government providing a commercial loan of up to $80m to the administrators to keep Rex’s vital regional routes operating, granting early access to former employees of Rex Airlines Ltd (the Boeing-737 business) to the Fair Entitlements Guarantee, and providing a guarantee in relation to regional ticket sales during the voluntary administration,” she said.


“To date, the Employment and Workplace Relations Department has received 306 claims and processed 302 claims from former Rex (RAL) employees, with over $7.1m already provided to Rex staff through FEG.


“These actions preserve important economic, medical and freight services, supporting regional liveability and regional economies.

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