Federal government extends airline support measures

Shot of a young woman walking with her luggage through the departure lounge of an airport

In welcome news for Australia’s aviation industry, the federal government’s support programs 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 Qantas and Virgin maintain some of its busiest Australian routes, was expected to end on 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.

More than $150 million has been invested by the federal government across these two programs thus far, with the extension of the programs coming as part of the Commonwealth’s 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.

In an attempt to further pressure states to open up, McCormack called on state premiers and territory chief ministers to consider easing their border restrictions.

“Uncertainty affects the ability of airlines and airports to plan for recovery and undermines consumer confidence, which amounts to a significant cost to industry and ultimately the Australian economy,” he said.

“The federal government is doing our bit by underwriting these flights to maintain minimum connectivity. Now, we need the states and territories to do their bit too as we again encourage the continued easing of border restrictions.”

Australia’s Deputy PM 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 support for key routes will be a big boost to local economies,” McCormack said.

According to ABC News, the total cost of the extension to the aviation support programs is dependent on several factors, including state border closures and COVID-19 restrictions. However, the government expects it will be in the hundreds of millions of dollars.

However, the Transport Workers’ Union (TWU) has argued that any new funding for Qantas through the DANS program should be provided on the condition that the airline drop its plans to outsource 2,500 ground workers.

The TWU also argues that funds from the federal government should only be provided to Qantas once the airline has repaid its workers for public holidays, weekends, overtime work and allowances, after the Fair Work Commission agreed that Qantas’ management had been gaming the JobKeeper scheme.

Commenting on the announcement of an extension of federal support for domestic aviation, Airlines for Australia & New Zealand (A4ANZ) chairman Professor Graeme Samuel AC said: “We appreciate the government’s support for, and recognition of, the vital role that airlines play in supporting Australia.

“These programs allow for the continuation of flights that create critical connections for people in all parts of Australia,” he said.

A4ANZ chief executive Dr Alison Roberts said: “We thank the government for its commitment to Australia’s aviation industry and we welcome the Deputy Prime Minister’s comments today that these extensions form a key part of the government’s continued support for the industry as part of the 2020-21 Budget.

“Australia’s airlines, large and small, will struggle to shoulder the costs associated with fully restarting their network operations. The industry would be significantly assisted in recovery planning and preservation of capacity if the Budget were to bring certainty on other forms of support that will likely be needed until at least 30 June 2021.”

[Note: This article has been updated since publishing to include comments from the Transport Workers’ Union and Airlines for Australia & New Zealand]

Featured image source: iStock/pixdeluxe

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