The Hon Catherine King MP
Interview with Patricia Karvelas on Radio National
PATRICIA KARVELAS: For the second time this year, a regional Australian airline has been placed in voluntary administration. The move puts hundreds of jobs in jeopardy and this morning many customers are scrambling to rebook flights, with many capital city flights cancelled after the late-night announcement. Regional routes are still operating. Catherine King is the Minister for Infrastructure, Transport and Regional Development. In fact, it covers everything in relation to this. Minister, welcome.
CATHERINE KING: Thanks for having me on Patricia.
PATRICIA KARVELAS: Rex has been trying to challenge Qantas and Virgin on Australia’s busiest routes, but its primary focus was regional routes. Is today another blow to competition in the airline industry?
CATHERINE KING: Well, look, of course thoughts are with workers today. No one wants to wake up to hear this news that your company has gone into voluntary administration. There’s been a fair bit of work done yesterday, and they will continue today to ensure that workers are looked after. I know that Virgin has already said that it will support workers and take some on fairly quickly. We’ll talk to Qantas today and of course, the Department of Employment and Workplace Relations will talk to the administrator about that.
In terms of passengers, I think that’s the immediate short-term interest to make sure all passengers are looked after. It’s good to see that all of the regional routes are continuing. People should contact Rex in relation to that particularly if they’re travelling on the Saabs, but head to the airport as they normally would. Virgin has stepped in, which we’re very grateful, to make sure that other passengers can be re-accommodated and people should contact Virgin. I’ll give the number out. I’m sure you’ve been doing that this morning, on 136 789 to rebook their tickets within the next two weeks on those capital city routes. There is no doubt though, that aviation, it is an incredibly challenging industry. We see that overseas. We see it here, particularly in the smaller market that we have. It is challenging, but I think where we are with Rex right at the moment, I think it’s in everyone’s interest that this airline continues, and we’re determined to do what we can…
PATRICIA KARVELAS: …So talk to me about the options the Government is considering. You’re saying it’s in the best interests that this airline succeeds. Are you saying the Government will not let Rex fail?
CATHERINE KING: Well, my view very firmly, and I think you heard that from the Prime Minister yesterday. We understand how important Rex is, particularly to the regions. There are some areas where this is the only option in terms of transport. And of course, that transport is critically important for medical appointments, for connection to family and for the economies of some of those smaller communities. So we know it is incredibly important. We also can’t do it just at any cost. So we’ll be talking to the administrators. We’ve been talking to Rex, my department, all of yesterday. We know that there will be some seeking of support from government, and we will take some time to work our way through that with the administrators. We want to do that properly. We want to…
PATRICIA KARVELAS: …So they have said they will be seeking what, a cash bailout from the government?
CATHERINE KING: They haven’t asked for our specifics as yet. They asked– which we did do. They asked for some assistance to ensure that their operations continue– can continue into the airports. So I called all of the airports, the major airports yesterday. They wanted to also make sure they could still access fuel supply and ground handling and those sorts of things. So we helped facilitate some of that yesterday, and my department was working through that as well. They will come to us, we know, they will come to us with specific ask. We will need to look at those in detail. I think it is fair to say that we would be reluctant to just throw money at the problem. What we would want to do is ensure that there is a long term solution to the security of regional aviation, and we will take time to work our way through that.
PATRICIA KARVELAS: Well, let’s talk about some of the solutions. I mean Rex can’t get slots into Sydney that are at times people want to fly. And this is part of the problem, the control of these slots. Are you going to intervene to fix that?
CATHERINE KING: So we already have and this is the– so there has not been slot reform for I think almost over 27 years at Sydney Airport. We’ve announced reform of slots. In fact Rex was already in…
PATRICIA KARVELAS: …The Opposition has said that it’s working at a pace that’s just too slow and that this is having an impact on this airline.
CATHERINE KING: Yeah. Look, I’m not going to cop that frankly, from the Opposition. They basically did nothing for a decade, sat on a paper for two years, and I had to come in and basically fix it and try and resolve the issues. So that’s what we have done. I look forward, we’re working our way to introduce legislation into the Parliament, and the Opposition should, if they are actually going to be constructive, which they have failed to be so far, will help with speedy passage through the Parliament.
PATRICIA KARVELAS: So when is the legislation going to be ready, given the urgency around Rex?
CATHERINE KING: Well, again, can I just be really clear? The issue of slots has not been the issue that we have. This is not the issue. I think it’s the speculation that that’s why this has happened, I think is, unhelpful. And in fact not necessarily the case. In fact, I think Rex has had a number of slots in and able to get slots to actually fly into these capital cities.
PATRICIA KARVELAS: The complaint is that they can’t get them at times where people want them.
CATHERINE KING: And exactly. The announcements we’ve made, which Rex were supportive of in terms of slot reform there, we’ve got a paper. There’s some technical issues that have to be worked through in terms of the slot manager, and it’s a big, complex piece of legislation. We’re working our way through that. We’ll have a bit more to say about that. But again, what I would say really clearly, there has been no attempt to reform slots in over 27 years. The previous government basically did nothing about it. We are doing something about it and it will be an important reform. We’ve announced that we’re working our way through that as it’s a complex piece. But what I would say is that it is important right at the moment, we’re trying to look after passengers, look after workers, work our way through what this means for regional aviation, and make sure we’ve got a long-term solution to the security of regional aviation. That is the most critical part of what we’re doing today.
PATRICIA KARVELAS: If Rex survives, it still may reduce competition on some of the routes. Do you expect that we’ll see prices increase for those regional customers?
CATHERINE KING: Look, I think it’s too soon to speculate about the broader impacts about what might happen in– if X, Y and Z occurs. I think at this stage, as I said, our focus is on making sure passengers have the least amount of disruption as possible, looking after workers, looking for the long-term solution in terms of particularly regional aviation, given the nature of our country and the spread that we need to make sure we actually keep those regional airports connected.
PATRICIA KARVELAS: So they’ll be, even if the flights continue in some of those places, can you guarantee that the prices won’t increase, though?
CATHERINE KING: Well, again, I think that that’s sort of a speculation about what might happen in a particular place. Of course, one of the parts of work that we have been doing is a major piece on the aviation white paper. We’re just about to announce that, we’ll obviously have to look at the current context about that as well, about when we announce the aviation white paper, but regional aviation and the surety around regional aviation pricing are what actually goes into that, is part of that aviation white paper.
PATRICIA KARVELAS: Catherine King, thanks for joining us.
CATHERINE KING: Good to be with you, and as I said, it’s a sad, sad day for, certainly, the workers. And I know the union’s been in touch, and encourage workers if you’re concerned to have a chat to your union. But we will work our way through this, and I know Virgin and Qantas are ready step up, also, to try and help.