SHARP SUBMISSION TO THE RURAL AND REGIONAL AFFAIRS AND TRANSPORT REFERENCES COMMITTEE

The operation, regulation and funding of air route service delivery to rural, regional and remote communities.

Overview

Sharp Airlines welcomes the opportunity to makes this submission.

Sharp Airlines operates Regular Public Transport services to the two isolated Bass Strait communities of and King Island.

Flinders Island has a population of 800 people.

King Island has a population of 1600 people.

By necessity, both Island communities are solely reliant on air services for passenger transport.

The cost of transport impacts the costs of living and service levels to both Islands.

In our submission, King and Flinders Islands will be treated as the same because the issues that affect one Island, also affects the other.

In the submission of the Flinders Island Municipality, they note the following:

“Flinders Island is currently in a phase of stable air access with the Regular Passenger Transport Service (RPT) supplied by Sharp Airlines once to thrice daily from Launceston, and 2-7 times weekly from Essendon, , based on the seasonal demand. Refer to Annexure 1 (Sharp Airlines summer schedule 2017-18) Sharp Airlines operates Metro-liners, configured to carry 17 or 19 passengers.

There are two small charter companies that regularly service the islands for freight and passengers, one based on Flinders Island and the other based at Bridport. The Bridport based company also undertakes the mail run to both Flinders and Cape Barron Island.

Whitemark airport is owned and operated by the Flinders Council after being handed over to the Council by the Federal Government in the 1990s, and operates at a loss. It is capital hungry. The Flinders Council recognises that should it try and recoup all operating costs from the current small number of users the cost of landing would be inhibiting to the use of the facility.

It is recognised that affordable airfares, for a safe, regular and reliable service supports population growth in remote regions such as ours and that growing population in regional areas is advantageous in both relieving the stress on metropolitan centres and making services in remote regions sustainable. “

Sharp Airlines Services.

From Launceston we provide a minimum of two day return services from Launceston to Flinders Island and Launceston to King Island daily.

For many months over the year these services increase up to four services a day.

From Essendon to both Islands similar services are provided.

This year we will carry to Flinders Island a total of 21,000 passengers and approximately 350,000 kilograms of freight.

The passengers and freight volumes carried to King Island for this purpose are very similar.

This year we will generate in total a $1m in sales over the both Islands in holiday tourism packages.

All services are conducted as Regular Public Transport flights, operated by turbo propeller Metro- liner aircraft and flown by two pilots.

BITRE figures show that in 1997/8 ( 20 years ago ), that Flinders Island a total of 22000 + passengers flew to and from Flinders Island, 1000 passengers less than is currently carried

Similar relative numbers apply to King Island – less passengers

The same BITRE figures show a progressive reduction in aircraft movements over the past years.

As the Flinders Island Council submission correctly identified

“Charter airlines have less regulatory burden than RPT services and the additional regulatory compliance for RPTs adds substantial cost.

On Flinders Island this disparity causes pricing issues and the RPT is having difficulty competing. An increasing number of passengers are choosing to fly with the charter airlines to and from Bridport at a cheaper rate, rather than to Launceston with the RPT.

This is compounded by the fact that people can leave a car at the Bridport airport for free rather than paying the $600 per year car parking fee at the . Landing at private airstrips in Bridport and on Flinders Island could compromise the safety of passengers as these strips may not be well maintained”.

Sharp Airlines is constantly facing unfair competition by charter operators which are not required to meet the same regulatory or safety standards that apply to an RPT operator.

The Flinders Island and King Island Council own, operates and maintains their respective Airports.

Both Airports run at a loss with Whitemark airport at a losing approximately $200,000 per annum.

King Island loses approximately $300,000 per annum

This year Sharp Airlines contributed $220,000 to each ($ 440,000) airport, by way of landing charges

This represents $184 for every man, woman and child that lives on both Islands.

On the basis that the operation (on their own submission), loses $200,000 per annum, passenger numbers would have to double to 40,000 passengers per annum to break even.

This will never occur. The same applies to King Island.

Proposed increased national security measures at regional airports will have a disastrous flow on effect to regional and remote airports and communities.

Security threats or potential security risks have to be balanced against the likelihood of probability

It also has to be balanced against the long term viability and existence of communities.

The burden of unwanted, unnecessary, disruptive, ill considered, thought bubbles by bureaucrats has to be overcome by simple common sense, along with some glimmer of commercial and economic reality.

The 2017 WA Parliament Inquiry into Regional Airfares found that newly introduced security screening added an average of between $11 -$22 per passenger each way to the cost of flying.

Mildura airport lost an airline because of the price increases due to the burden of security charges.

Flinders Island and King Island has a history of RPT airlines going out of business and it is vital to the Island’s economy that our RPT airline thrives as well as encourages visitation and tourism.

As proposed increased security requirements are federally imposed, we look to the Federal Government for assistance to offset any impost in relation to increased operating expenses.

Assisting municipalities with one of Federal Government funding to meet some of the infrastructure requirements does not take into account the ongoing operational costs of running a modern day or indeed the support provided to remote communities.

Air services to remote regions are generally already in decline and any further cost burden on Companies, or the travelling public will only further hasten their collective demise.