The WA government is reviewing its aviation policy and the Transport Co-ordination Act to license intrastate airline operations, balancing competition and stability while discouraging 'cherry picking' of routes to ensure network coverage, particularly for vulnerable short-haul routes.

AnsweredQoN 824Legislative Assembly
Asked
21 March 2002
Member
Portfolio
Planning and Infrastructure

QuestionView source ↗

How is the State Government proposing to use its regulatory powers to license intrastate airline operations? Ms MacTIERNAN

AnswerView source ↗

This issue is obviously of considerable concern to the member for Eyre and his electorate, which is dependent upon the provision of stable, sustainable air services. The Government is in the process of undertaking a review of its aviation policy. That will include a review of the application of the relevant sections of the Transport Co-ordination Act, which provides the power to license intrastate air services. A number of applications proposing to compete with some existing air services are currently before the Government. We need to deal with those applications. We are seeking advice from regional development agencies and local authorities. No policy was developed in the past to deal with such applications. That was principally because there was a virtual monopoly in the State and there was little realistic scope for new players to take on the Ansett-Skywest conglomerate. Of course, we now have an entirely new landscape. A number of players are keen to enter the field. It is vital that we get a proper balance between competition and stability. The Government has indicated that it is determined to discourage cherry picking. We will ensure that the future licensing of intrastate routes is tied to network coverage, particularly on the vulnerable short-haul routes. In assessing the applications for new operations the Government must determine what level of service is reasonably sustainable. In order to make an informed decision on that, the Government needs to develop models of potential capacity. To develop those models we need to look at historical data, the experience in other States, opportunities for complementary services, and the capacity to grow the market. I know that Mr Speaker also is vitally interested in aviation services to regional Western Australia. There is a growing acceptance among commentators that the Government must take a long-term view. We have to resist the temptation to put short-term price-cutting before a sustainable, stable air service for the State. I can assure members that the Government’s policy will do that.
Ms MacTIERNAN replied: This issue is obviously of considerable concern to the member for Eyre and his electorate, which is dependent upon the provision of stable, sustainable air services. The Government is in the process of undertaking a review of its aviation policy. That will include a review of the application of the relevant sections of the Transport Co-ordination Act, which provides the power to license intrastate air services. A number of applications proposing to compete with some existing air services are currently before the Government. We need to deal with those applications. We are seeking advice from regional development agencies and local authorities. No policy was developed in the past to deal with such applications. That was principally because there was a virtual monopoly in the State and there was little realistic scope for new players to take on the Ansett-Skywest conglomerate. Of course, we now have an entirely new landscape. A number of players are keen to enter the field. It is vital that we get a proper balance between competition and stability. The Government has indicated that it is determined to discourage cherry picking. We will ensure that the future licensing of intrastate routes is tied to network coverage, particularly on the vulnerable short-haul routes. In assessing the applications for new operations the Government must determine what level of service is reasonably sustainable. In order to make an informed decision on that, the Government needs to develop models of potential capacity. To develop those models we need to look at historical data, the experience in other States, opportunities for complementary services, and the capacity to grow the market. I know that Mr Speaker also is vitally interested in aviation services to regional Western Australia. There is a growing acceptance among commentators that the Government must take a long-term view. We have to resist the temptation to put short-term price-cutting before a sustainable, stable air service for the State. I can assure members that the Government’s policy will do that.
This issue is obviously of considerable concern to the member for Eyre and his electorate, which is dependent upon the provision of stable, sustainable air services. The Government is in the process of undertaking a review of its aviation policy. That will include a review of the application of the relevant sections of the Transport Co-ordination Act, which provides the power to license intrastate air services. A number of applications proposing to compete with some existing air services are currently before the Government. We need to deal with those applications. We are seeking advice from regional development agencies and local authorities. No policy was developed in the past to deal with such applications. That was principally because there was a virtual monopoly in the State and there was little realistic scope for new players to take on the Ansett-Skywest conglomerate. Of course, we now have an entirely new landscape. A number of players are keen to enter the field. It is vital that we get a proper balance between competition and stability. The Government has indicated that it is determined to discourage cherry picking. We will ensure that the future licensing of intrastate routes is tied to network coverage, particularly on the vulnerable short-haul routes. In assessing the applications for new operations the Government must determine what level of service is reasonably sustainable. In order to make an informed decision on that, the Government needs to develop models of potential capacity. To develop those models we need to look at historical data, the experience in other States, opportunities for complementary services, and the capacity to grow the market. I know that Mr Speaker also is vitally interested in aviation services to regional Western Australia. There is a growing acceptance among commentators that the Government must take a long-term view. We have to resist the temptation to put short-term price-cutting before a sustainable, stable air service for the State. I can assure members that the Government’s policy will do that.
In assessing the applications for new operations the Government must determine what level of service is reasonably sustainable. In order to make an informed decision on that, the Government needs to develop models of potential capacity. To develop those models we need to look at historical data, the experience in other States, opportunities for complementary services, and the capacity to grow the market. I know that Mr Speaker also is vitally interested in aviation services to regional Western Australia. There is a growing acceptance among commentators that the Government must take a long-term view. We have to resist the temptation to put short-term price-cutting before a sustainable, stable air service for the State. I can assure members that the Government’s policy will do that.

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