In welcome news for Australia’s domestic and regional aviation providers, critical public support measures have been extended.
Both the Domestic Aviation Network Support (DANS) and Regional Airline Network Support (RANS) programs will be extended to 31 January 2021 and 28 March 2021, respectively.
The DANS program, which has helped the likes of Qantas and Virgin maintain some of their busiest Australian routes, was expected to end last Wednesday.
While the RANS program, which was set to end in December this year, has reportedly been handed to around a dozen regional operators, including Regional Express (Rex).
More than $150m has been invested by the federal government across these two programs, thus far, with their extensions coming as part of the 2020-21 Budget.
“Planes in the air mean jobs on the ground, and as part of our economic plan for a more secure and resilient Australia, we will continue to back our aviation sector,” Deputy Prime Minister Michael McCormack said.
McCormack also said he was hopeful the extension of government support would see regional airlines offer more flights to towns that are desperate for visitors.
“We know regional tourism will help drive Australia’s economic recovery, and today’s announcement of further sup- port for key routes will be a big boost to local economies,” he said.
One of the main recipients of the RANS program, Rex – which operates out of Mount Gambier Regional Airport – thanked the federal government for the program’s extension.
However, when asked by The SE Voice how further funding would affect or benefit its operations out of Mount Gambier Regional Airport, and to clarify how much funding it had received through the RANS program, Rex did not address the questions.
Instead, the regional carrier directed The SE Voice to a media release, which said the extension of the RANS pro- gram would “ensure that vital regional air corridors remain operating, albeit at reduced capacity”.
In its annual report for FY20, Rex said it had received at least $62m in grants from the Commonwealth in the 12 months to 30 June, $53.9m of which was given to the carrier in late April from the federal government’s $100m Regional Airlines Funding Assistance Program.
However, the carrier still posted a $19.4m statutory loss after tax for 2020.
“The COVID-19 pandemic has all but decimated regional aviation,” Rex deputy chairman John Sharp said in the media release.
“At the outset of the pandemic, region airlines were haemorrhaging money after the devastating downturn in passenger demand. Many regional airlines, including Rex, were left on the brink of insolvency amid the worst operating conditions the industry has seen.”
Mr Sharp said that although Rex has seen passenger numbers beginning to improve in some states and across Australia, the current market environment means that air services continue to be unprofitable.
“The extension of the RANS program means regional communities across Australia will continue to retain and benefit from access to their air services,” he said.
“More importantly, it allows Rex to increase ser vices in many cities whenever the services could cover their variable cost.
“This will greatly assist in the rebuilding and recovery of regional and rural economies hard hit by the prolonged drought, the summer’s unprecedented bushfires and the economic impact of lockdowns and border closures due to COVID-19.”
The total cost of the extension to the DANS and RANS aviation support pro- grams is believed to be dependent on several factors, including state border closures and coronavirus restrictions across Australia.
However, the government expects it will be in the hundreds of millions of dollars.
The announcement of ongoing sup- port for the aviation sector builds on more than $1.3b already committed to maintaining operations and supporting jobs in the industry.
