Press conference, Brisbane

CATHERINE KING: Thanks very much everybody. I just wanted to take the opportunity, while I was here in Brisbane, to provide an update on the situation with Rex Airlines. I know you are eager to hear from the Treasurer shortly. 

As you’ll know, obviously, overnight it announced that Rex and a number of its subsidiaries have entered voluntary administration. It has grounded its intercity 737 fleet, with passengers informed overnight that they are able to rebook on Virgin at no additional cost. This morning, I have also spoken with Vanessa Hudson, the CEO of Qantas. They are also offering passengers impacted by these events the ability to rebook on their services at no additional cost, where seats are available on those intercity routes. Affected Rex passengers can call Virgin on 13-67-89, or Jetstar on 13-15-38, and Qantas on 13-13-13, and they will do absolutely everything they can do to accommodate those passengers. 

In terms of Rex regional fleet, these flights are continuing to operate as scheduled, and that is a relief, I know, for many in regional communities, given the importance of those routes. And that is very much appreciated. To be– I will be clear, Rex’s continuation is in the best interests of regional Australians, the travelling public, its workers and the aviation sector more broadly. And the Government will work very closely with the administrators to ensure a strong regional aviation presence in the future. 

My department has already met with the administrators today and will continue to engage with those. The administrators are also briefing state and territory governments today, and my department will do the same through transport portfolio or transport departments as well. Of course, the administrators were only appointed last night, and they have a very big piece of work in front of them in terms of getting a handle on all of Rex’s operations, their balance sheet and a way forward. When Virgin entered administration, I’ll remind people it did take the Government a few weeks – in fact in that case, a few months to in fact look at a pathway forward for that. 

The Government will act expeditiously, but we will also be acting carefully in this space.  

It is a complex situation with multiple commercial arrangements in place, but we do stand ready to work very closely with the administrators, because that regional presence is absolutely vital.

I am pleased that the administrators have already spoken publicly this morning to confirm that they do have sufficient funding available to maintain the regional services throughout the period of administration. 

This is obviously a really distressing time for staff, and I do want to say– and thank you both again to Virgin and Qantas, who have said very clearly if they have available positions – and both of them do at the moment and through Jetstar as well – they are very happy to look at taking on Rex staff. But also if there are any staff, please contact your union at the earliest opportunity if you’ve got any concerns in terms of that as well. I understand the trade unions were briefed yesterday about that. And the other issue is obviously the Department of Employment and Workplace Relations has also already been engaged in order to– and are already engaging with the administrators. I’m really happy to take any questions. 

JOURNALIST: Minister, would you– would the Government be willing to bail out the private equity– international private equity fund?

CATHERINE KING: I think the first thing that we are interested in doing is hearing from the administrators about what is needed in order to make sure that the regional aviation that Rex is providing continues, and so that’s what we will work with the administrators to do. Our view very firmly is that we want regional aviation to continue. In some instances, it is the only service, only possibility that is available for people to get in and out to get to medical appointments. And there are some states that are already subsidising some of those routes. We will be working with the administrators in relation to that, but any other– anything else is speculation at this stage.

JOURNALIST: Is there a preliminary sort of figure that the Government might come up with?

CATHERINE KING: Not at this stage. Obviously, the administrators were only appointed overnight, and they’ll continue to work through that. There’ll be a range of asks that they have of us, short, medium and longer term, and we’ll work our way through that. But what I would say is that we’re not going to rule anything in and out at this stage, but we do very firmly believe that this– Rex is an important player in the aviation market, but particularly in our regions, and important that we continue to have those regional services. And we’ll work with the administrator to ensure that that’s the case. 

JOURNALIST: On that point, do you think that any government help might be contingent on the fact that those regional routes remain, and Rex focuses more on that, rather than its city to city flights?

CATHERINE KING: Well, obviously our concern, and we’ve said this very clearly, is to ensure that regional Australians continue to have the air services that they need to be able to not just access things like health appointments, but also being able to participate in the broad economic and social life of this country. And I know aviation and regional aviation plays a critical role in that. Aviation also employs lots of people in our regions, whether it’s in Wagga with our pilot school, the maintenance that Rex has there. In my own constituency, there’s people– there’s a small pilot school there as well. Those are all really important regional jobs and regional services, and that is certainly our focus.

JOURNALIST: What competition is your white paper hoping to solve if it’s evidence here or, you know, there’s an inability for three airlines to service the cities in Australia?

CATHERINE KING: Well, I think that what you’ll see with the white paper, which obviously we’re wanting to release as quickly as we possibly can, is that really what we’re trying to do here is to ensure that the future settings for aviation, not just in the immediate short term, but that we have strong aviation over the next 20 years. It is pretty evident that there hasn’t been a lot of reform in this sector for a while.

It’s why we announced in February the significant– the most significant slot reforms to Sydney Airport in over 27 years. It’s why we’ve been working our way through around what do you do in terms of getting better consumer guarantees, consumer rights in this place, how do you get better disability services and support in aviation, and what’s also happening in the future of aviation through sustainable aviation fuel, what do you do with that? 

So we’ve been working our way through all of those, but it is absolutely fair to say that aviation is a really difficult place. You know, it’s not only just difficult here in this country – difficult in others. You’ve seen airlines rise and fall over the course of the history of this industry. And so what we’re trying to do is make sure that we’ve got the settings right, the regulatory settings right, that we’re putting pressure on airlines to be able to make sure they are providing the best service they possibly can at the best price they possibly can. And that’s been our concentration through the aviation white paper.

JOURNALIST: What’s the appetite for airline or airport legislation before the next election?

CATHERINE KING: Well, certainly slot reform is a really complex piece, so we are working our way through that at the moment. And also working our way through the legislative process and a Parliamentary in terms of that as well, and I look forward to the Senate’s support when that legislation comes before the Parliament.

JOURNALIST: Are you aware of any other operators who might be able to scale up to take some of the load if it doesn’t work out for Rex?

CATHERINE KING: Look, again, early days to speculate. Look, I’m very pleased that obviously Rex and Virgin have been having some conversations over the course of the last few days, and again Virgin has stepped up very quickly. And we’re very grateful to that, and I’ve spoken to Jayne Hrdlicka directly to thank her for that, to make sure that we don’t have disruption for passengers. They’re pretty keen, I think, to take some of their staff. They’ve got–  it wouldn’t be a surprise to anyone there are pilot shortages, there are cabin crew shortages, there are maintenance and technical shortages all over the country. And so these are jobs that people are looking to get staff into, so they’ve stepped up pretty quickly. And then I spoke to Vanessa Hudson this morning to see what they could do, and they’ve also– in a similar position to try and get staff in, and I think it’s too early to say about what will happen next, really. That’s part of the administration over the course of the next few weeks. 

JOURNALIST: Rex had sliced out quite a trusted corner of the market, and I’m sure there’s a lot of consumers out there that are pretty disappointed now. What– are you concerned about the prospects of the airline market in Australia, given how well they seem to…?

CATHERINE KING: …Well, I think, as you know, Rex emerged after the collapse– so, you know, the– back in I think it’s 2001, I think, out of the collapse of Ansett, and sort of that regional route not having that. And they’ve really made a terrific name for themselves, frankly, in that regional space, and I think that’s been important. They are a regional airline, and that’s where they’ve been. And again, as I said, I think that’s been a really important part that the Government wants to– you know, we have to see that continue. It’s important that that be the case. And I think they have been a trusted and a long-term brand, and our hope– very much and some assurances from the administrators is that they emerge out of this, and they emerge out of this as a strong regional airline.