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Australian PM mulling deregulation of regional air routes

Australian Prime Minister Malcolm Turnbull is looking at deregulating air routes to lower flight prices in regional Western Australia.

Turnbull visited the North West last week and said that he would look closely at the possibility of deregulating domestic air routes to allow more competition into the market.

The Australian PM’s comes at a time when the State Government is launching an inquiry into the cost of regional airfares, including that of Karratha, this month.

Western Australia Premier Mark McGowan admitted that opening up air routes to more competition could possibly lead to lower services.

“It has been talked about forever and I am generally in favour of having more competition”, he said. “However the problem has always been in the WA context, with very low volume routes and large distances, that a deregulated system may result in less services rather than more.”

“(The Federal Government) is a big purchaser of tickets, so anything they can do in terms of putting their purchasing power towards getting the airlines to do the right thing would be appreciated”, McGowan added.

McGowan also said that the competition that foreign airlines bring into the domestic market could hurt the viability of Australian carriers. There have also been some calls for the inquiry to inspect the merits of regulating flight prices, possibly through instigation of a government-protected monopoly.

Durack MHR Melissa Price said the Federal Government had no intention to regulate airfares.

“All we can do is continuously work with Qantas in particular because they’re the ones who seem a bit more dear”, she said. “At the end of the day they’ll say we have to make money, we’re a business.”

She said that the issue of high airfares had been “going around in circles” for quite some time.

”You’ll see sometimes all of a sudden there’ll be focus on the Pilbara and the airfares will get a little bit cheaper,” she said. ”I have to say when I’ve looked at this whole landscape in terms of the Pilbara, Newman’s probably the worst off out of anybody because they don’t have as many flights as you’ve got.

“If you’re a business owner, or the girl that works at the news agency and don’t work for BHP you’ve got no choice.  Even if you book 12 months in advance, you’ll be paying $800. Now, I think that’s wrong”, she quipped.



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