Transcript - Triple M Dubbo

CHRIS MATHISON [CO-HOST]: We're joined by Federal Member for the Federal Government, Catherine King, the Minister for Infrastructure, Transport, Regional Development and Local Government. Catherine, good morning.

CATHERINE KING [MINISTER]: Really good to be with you this morning.

CHRIS MATHISON: Do you get paid by how many things are in your title?

CATHERINE KING: [Laughs] It's a long title, but I've got two fabulous ministers underneath me who look after in Kristy McBain, local government and regional, and Jenny McAllister in the city. So I've got a long title, but I've got some people to help me out as well.

CHRIS MATHISON: You'd want someone at least.

JODI HOWARD [CO-HOST]: [Laughs] You need someone to help with that.

CHRIS MATHISON: [Indistinct] …

CATHERINE KING: Yeah, well, the transport portfolio is keeping me pretty occupied at the moment.

CHRIS MATHISON: I could imagine. We're talking about transport. We're talking about Rex. Can I ask what factors have led the Federal Government to decide to guarantee these Rex flight bookings?

CATHERINE KING: Well, the first thing we've wanted to do as Rex has entered into voluntary administration is keep those regional flights going and the administrators have done that. But we also need to make sure that it's a viable regional airline as they go through their next phase of recapitalisation to keep that airline going. I know, as a regional MP, just how important this airline is for regional Australians. In some cases, it's the only airline that flies in and out of an area. So, trying to access medical services, family, just being able to do your business is really important. Our first thing has been, really, how do we help make sure that this continues to be a viable business as it goes through its administration process?

So yesterday, we announced that the Federal Government will guarantee regional flight bookings for Rex customers throughout the voluntary administration process so that travellers should continue to book on Rex Airlines and have that certainty that they will either fly or get their money back because their flights are underpinned by a government guarantee. So that's the sort of first stage of really making sure we help as much as we can to keep planes in the air for regional communities while it goes through administration and it recapitalises.

JODI HOWARD: How does Rex's financial situation reflect on, you know, the broader challenges in the aviation industry in relation to, you know, other carriers may be using this as an advantage to bump up prices and that sort of stuff for the regional areas?

CATHERINE KING: Yeah. Look, it's hard to say because, you know, we haven't really understood or got to the bottom - we're not in the administration itself of what's actually happened in these circumstances. And aviation, it is really complex. Rex has had an advantage in the sense that it has owned its own planes. So leasing planes can be very challenging when you're an airline. So being able to make those monthly lease costs, particularly when there's big demand for aeroplanes at the moment, there's a lot of shortages around the world for those as well. So they are expensive. Your staffing costs are obviously expensive. You've got costs going in and out of airports and you've got fuel costs as well, and all of those can vary at different points in time. Regional aviation as well, just because it's smaller markets as well – that is the challenge that regional airlines will always have.

But Rex has been around for a long time. It's been really competitive in that regional space. It had plenty of slots at Sydney Airport. In fact, it had to give some of those back. It had plenty of slots in peak hours as well. So I think it was holding its own in that regional space. But I think the challenge obviously is it's just - like, it's a really expensive business to run, particularly when you've got - you're in that smaller market of the regions.

CHRIS MATHISON: Is there anyone - you probably can't tell us, but I'm going to ask, is there anyone interested in actually taking over Rex? 

CATHERINE KING: Well, that's really going to be a matter for the administrators, but I understand there is interest. Obviously, they are looking to sell the whole of the business, not the whole of the business is in administration. So they are working their way through that at the moment and we'll continue to work with them. We think that what it is sounding like is that there will be a market-based solution to keeping Rex in the air, and a new model of Rex in the air, and what government support might be needed for that will be a matter for the various bidders to work through with us.

CHRIS MATHISON: Well, we hope so because Rex is very much valued out here in Dubbo, and we hope that they can keep flying in the air. Catherine King, Minister for Infrastructure, Transport, Regional Development and Local Government, thank you so much for joining us today. We really appreciate your time. 

CATHERINE KING: You are most welcome. And my message to the audience is keep booking with confidence on Rex. They're going to keep flying. We're really determined to keep that service going, but this guarantee means you should book with confidence because we need to make sure we support this – our regional airline.