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The Coalition Government will support at risk regional air routes with up to $30 million in loans from the Regional Infrastructure Fund for small passenger airlines, Regional Development Minister Shane Jones and Associate Transport Minister James Meager say.
“Reliable air services are critical for the economic and social wellbeing of regional New Zealand. They enable access to healthcare, education, business, and whānau, particularly in areas where other transport options are limited,” Jones says.
“Small regional carriers are under pressure from rising costs, limited access to capital, and ongoing post-COVID disruptions. Without this support, some communities risk losing vital air links and potential regional development,” Jones says.
Meager says the support is not a bailout, with funding coming in the form of concessionary loans.
“The aim is to stabilise the sector and support regional routes in the short to medium term. This is not intended to meet all the airlines’ capital needs but to provide targeted relief for such things as aircraft leasing, maintenance and debt refinancing.”
Cabinet has also approved funding for what could be a game-changing development for small regional carriers – digital upgrades that integrate regional transport bookings with the platforms of major carriers.
Known as ‘interlining’, the upgrades will enable passengers to book a single itinerary and flights on different airlines, including the major carriers.
“Streamlining bookings and baggage-handling between the smaller carriers and the bigger players in the aviation sector will makes it much easier for the travelling public to plan and book their preferred routes in one go,” Meager says.
“Without intervention, our regional airlines face further service cuts or a complete withdrawal from routes, as we’ve seen in some regions around the country. Once fleet capacity is lost, recovery is difficult and costly. We’re acting now because a combination of factors, including the ongoing after-effects of the pandemic on air services, are placing exceptional pressures on the sector at present,” Jones says.
“This Government is committed to ensuring that all regions, not just the main urban centres, remain connected and included in the national economy. This is a one-off, modest but meaningful intervention that will help prevent further service loss and protect regional connectivity.
The loans will be administered through Kānoa Regional Economic Development & Investment Unit. Applications will open shortly on the Grow Regions website at www.growregions.govt.nz
