New Economy Lite fares will start from just $59 one-way between Sydney and Byron Bay, putting it on a par with low-cost rival Jetstar. It comes despite the closure last year of budget subsidiary Tigerair.

Chief executive Greg Foran said he was “relieved” and “grateful” at the decision, which means the airline will operate seven services from Queenstown to Auckland and Wellington.

PM Morrison said the initial flight of just 26 people included Australian citizens, Afghan nationals with Australian visas, and one foreign official, despite the C-130J's 128-person capacity.

The union said employees are still concerned about the difficulties in accessing a jab or losing pay as a result of taking time off.