The federal government has announced that $715 million in fees and industry levies for Australian airlines will be waived in a relief package aimed to help them through major hits to tourism from global COVID-19 travel bans.
Qantas has cut its international capacity by 90 per cent and Virgin Australia announced it would be grounding the entirety of its international fleet.
The federal government has also made strong calls not to travel overseas as containment measures are increased.
The support package, announced on Wednesday, will refund and waive aviation fuel excise, air service charges and domestic and regional aviation security charges.
Deputy Prime Minister Michael McCormack said the “major relief package” would be backdated to apply to charges from 1 February, returning almost $160 million to the industry.
“Our airlines run on tight budgets at the best of times and these past few weeks have been particularly tough. I’ve been speaking with Australian airline executives every day and will continue to work with them to make sure they receive the support they need,” he said.
“Providing this assistance not only helps our airlines, but the entire aviation industry, regional Australians in particular and other industries such as tourism and trade, which rely on aviation.”
There is not yet a date set for these support measures to end, with Deputy PM McCormack saying the government will continue to work with the aviation industry as it faces ongoing challenges from the coronavirus pandemic.
Calls for support had come from regional and international operating airlines as the challenges continue to mount, with regional airline Rex stating that small carriers may have only weeks of reserves left. Without government intervention, irreversible damage would occur to the across the industry.
In an open letter to the Deputy Prime Minister, Rex’s chief operating officer Neville Howell called for urgent action.
“Rex does not believe that Rex, and all other regional carriers, will be able to pull through this crisis without significant assistance if the health authorities’ projections prove accurate,” Howell wrote.
Howell argued Rex was “one of the few airlines in the world and the only Australian carrier that has continued to maintain uninterrupted profitability when faced with the series of severe global economic and environmental shocks of the past two decades, including war, fuel prices above US$120 a barrel, volcanic ash, GFC, the worst drought in 120 years, catastrophic bushfires [and] crippling pilot shortages”.
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