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January 2018 Dr Jane Thomson Committee Secretary Senate Rural

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January 2018 Dr Jane Thomson Committee Secretary Senate Rural January 2018 Dr Jane Thomson Committee Secretary Senate Rural and Regional Affairs and Transport References Committee Parliament House CANBERRA ACT 2600 Re: The operation, regulation and funding of air route service delivery to rural, regional and remote communities. This submission is provided to the committee on behalf of the Callide Dawson Chamber of Commerce and Biloela Enterprise, both of whom are community organisations which represent the business and community interests of the Banana Shire area within Queensland. It is acknowledged that the Banana Shire Council has made an individual submission to the inquiry and the parties of this submission are supportive of the comments and recommendations made within that submission. Details on council subsidies can be found in the Council submission and therefore will not be addressed in this submission. The Shire of Banana is located in Central Queensland, with a population of approx. 15,209 people spread over 28,577 square kilometres. Banana Shire is located on the Brisbane and Melbourne freight route via the Burnett and Leichhardt Highways; is connected to the port city of Gladstone via the Dawson Highway and to Brisbane via the Burnett Highway and commercial air services out of the Thangool Aerodrome Response to the Terms of Reference Social and economic impacts of air route supply and airfare pricing; Airline competition within rural and regional routes The Banana Shire is currently serviced by Fly Corporate, a small airline operating regional passenger services in Queensland and New South Wales. The Shire was previously serviced by Qantas however Qantas withdrew their Thangool to Brisbane service in February 2017 due to low passenger numbers. Like many Regional Rural and Remote (RRR) areas the Banana Shire is within driving proximity (within 2hours) to two costal locations serviced by the major airlines of Qantas Callide Dawson Chamber of Commerce: [email protected] Biloela Enterprise: [email protected] and Virgin. This has a significant impact on the uptake of the local regional service with the ability of these major carries to offer flexible flight times and cheaper airfares in business viable locations accessible to many residents and corporations operating in RRR areas creates a difficult environment for the local regional services to operate in. The savings offered by the major airlines can be substantial enough to warrant the drive to these locations for many families and business. Furthermore, even when the savings do not cover the extra cost of travel to these locations, the flexibility of flight times or perception of savings is enough to entice passengers. Not only does this decrease the utilisation of the local service but adds to the economic impact of money going out of the local community, with many undertaking shopping or purchasing supplies whilst in these locations. It is important to note however that not all community members are able to travel to these locations and there is no public transport and limited commercial transport available. With RRR areas of Australia contributing to 40% of Australia’s GDP it is vital that our regional air services are able to operate in a manner that encourages their use over coastal centres. Subsidised fares and operating cost are only part of the solution, the ability to provide flights times where passengers can access return flights to capital cities within the same day for business or medical appointments is essential. Landing availability in capital city airports must take into account the need for RRR community access. Communities and businesses operating in RRR areas are acutely aware of the need to balance service delivery capability and capacity with business sustainability. As noted, local regional services often compete with the major airlines in costal centres due to proximity of location however they operate smaller aircraft, often 16 seats compared to a 30 plus capacity flights out of a costal centre. The ability to recover overhead costs by seat capacity is therefore substantially reduced for regional services. Innovative solutions are needed to assist in viable recovery options for regional carriers. Initiatives which recognise the reduced capability and capacity imposed on regional services because of RRR requirements such as passenger numbers, security measures and landing capacity of air strips are essential to the sustainability of this community need. Recommendations That the Federal Government work with regional carries to develop cost recovery models that recognise the reduced capability and capacity imposed on RRR services. That the Federal Government work with relevant parties on initiatives that acknowledge and consider RRR community access through landing availability in capital city airports. Callide Dawson Chamber of Commerce: [email protected] Biloela Enterprise: [email protected] That the Federal Government consider initiatives which support the viability and sustainability of regional carriers, including initiatives the promote industry use of local regional services. Different legal, regulatory, policy and pricing frameworks and practices across the Commonwealth, states and territories; Pricing determination, subsidisation and equity of airfares; Determination of regulated routes and distribution of residents’ fares across regulated routes; any related matters. Recommendations That the Committee consider any impact on the operation and air services to rural, regional and remote communities resulting from pilot shortages within Australia. That the Committee consult with the COAG Transport and Infrastructure Council on identified issues, outcomes and current work being undertaken in this area, including any State and Territory lead reviews of regional and remote air services. For example, the recent Queensland Government updated review of long-distance passenger services, which will encompass regulated, non-regulated and government-subsidised bus, coach, rail and air services in regional Queensland. That the Committee request an update from the COAG Transport and Infrastructure Council on the National Remote and Regional Transport Strategy, including the key action (5) to ‘Explore a nationally centralized remote aerodrome administrative, management and service delivery approach, including funding arrangements’. Kind Regards Callide Dawson Chamber of Commerce Biloela Enterprise Callide Dawson Chamber of Commerce: [email protected] Biloela Enterprise: [email protected] .
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