Federal government committed to funding regional airports

Minister for Infrastructure and Transport Darren Chester says the federal government is committed to help regional airports meet the financial challenges in the years ahead.

While the likes of privately-owned Brisbane West Wellcamp have been able to grow from nothing to having three domestic airlines and a once-weekly freighter service to Hong Kong in the space of two years, the story for other smaller airfields around the country is far less positive.

The state of the nation’s regional airports was highlighted in September, when the Australian Airports Association released its Regional Airport Infrastructure Study conducted by ACIL Allen Consulting.

The report found regional airports faced a significant funding shortfall in the years ahead to maintain existing facilities and upgrade their airfields to cope with the expected growth in the sector.

“On average regional airports had a six per cent funding gap in 2014/15 between the expenditure required to operate the airport and subsequent revenue collected from its operations,” the report said.

“The funding gap was 3.4 per cent for regular public transport (RPT) airports and 45.6 per cent for non-RPT airports.”

Chester acknowledged the difficulties faced by many regional airports, noting “not all regional and remote airports can be a Wellcamp or Canberra, no matter how entrepreneurial their managers”.

To that end, the Minister said the government’s Regional Aviation Access Programme, which provides funding for remote air services subsidies, remote airstrip upgrades and remote aerodrome inspections, has so far this year assisted upgrades at Merimbula, Moruya, Port Macquarie, Tamworth and Busselton-Margaret River airports.

And the latest round of the National Stronger Regions Fund has recently approved funding for works at Derby, Parkes and Dubbo airports.

“At the local level, it can be a challenge to adequately fund the ongoing maintenance and development of regional or remote airports,” Chester said in a speech to the Australian Airports Association annual awards dinner in Canberra on Wednesday night.

“Other levels of government are generally responsible for these airports within our federal system. However, we do provide funding for access and safety upgrades through the Regional Aviation Access Programme.

“I am committed to continue to fund our regional and remote aerodromes and will work with the AAA on how best our government can deliver the appropriate support to this vital infrastructure.”

The AAA report, published in September, estimated regional airports with fewer than 500,000 passengers movements a year spent $185 million in 2014/15 to maintain and improve operations.

However, expenditures for regional airports were expected to rise by 38 per cent over the next decade, putting even more pressure on already stretched budgets, with 61 per cent of the nation’s regional airports running budget deficits in 2014/15.

Further, some 40 per cent of regional airports expected to have “persistent budget deficits over the next 10 years”.

“Many regional airports in Australia are operating at a loss each year, and are heavily dependent upon cross-subsidisation by their local government owners who face multiple and competing demands on their limited financial resources,” the report said, adding that airport owners faced financial stress from the costs of maintaining and operating the airport.

“Regional airports also face great challenges in upgrading facilities to meet future aviation needs.

“Across Australia’s regional airport network, it is expected that the annual budget deficit will be $17 million per year, equating to a $170 million shortfall in essential infrastructure and maintenance funding at regional airports over the next 10 years.”

Chester noted that as a regional member of parliament – the Minister is the Member for Gippsland in Eastern Victoria – he was “acutely aware of the importance of aviation to regional, rural and remote communities”.

“I thank the AAA for its recent report on Regional Airport Infrastructure, highlighting the challenges that these essential transport hubs are facing,” he said.

“Providing vital access to health care and other professional services for many, aviation services have also been a key enabler of growth in mining, agriculture and tourism within many of our regions.”

 

Australian Aviation

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