Struggling airline Rex will continue to provide flight services to regional Australian destinations after government intervention.
Rex went into voluntary administration in July and its management was handed to administrators EY Australia (formerly Ernst and Young).
Transport minister Catherine King and workplace minister Murray Watt today announced the government would provide up to $80 million in support and grant early access to entitlements for Rex’s former employees.
Rex’s administrators plan to apply to the federal court to extend the voluntary administration to June 30, 2025. If the application is granted the government will continue to guarantee ticket sales made throughout the administration period to that date.
The ministers said the guarantee has been effective so far, “and has yet to be used with flight bookings holding up well”.
More than 600 workers were made redundant when it was revealed Rex was struggling under the weight of $500 million of debt. In August, the government stepped in to guarantee bookings on regional flights, but resisted calls for a bailout.
The administration process for Rex was progressing, the government said as it noted the recent sale of its Pel Air Aviation business to Helicorp Pty Ltd, which is part of Toll Aviation. The sale proceeds will be used to repay secured creditors.
"This Federal Government financing facility will enable us to continue to support regional communities through an extension of the voluntary administration," EY spokesman Samuel Freeman said.
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