Rex Express walks away from its Clarence Valley airline route trying to blame others for its decision

“Rex will stand by all regional communities that have stood by Rex during this global and national crisis” [Rex Express Holdings Deputy Chairman and former Nationals MP for Hume, the Hon John Sharp AM, company media release, 29 April 2020]

Stirring words in that quote at the top of this post.

The facts on the ground are somewhat different.

It appears that Rex Express Holdings* directors Kim Hai Lim, John Sharp, Neville George Howell, Christopher Hine, Thian Soo Lee, Ronald Bartsch, James Davis and at least one senior company executive David Brooksby are so offended by having their company's begging letters actually answered with increased funding/concessions from Clarence Valley Council that they have decided to remove the Clarence Valley’s only commercial air link with the outside world.

Council’s financial assistance was in addition to Rex Express receiving nearly $24 million from the federal government’s $198 million Regional Airline Network Support Program (RANS) and $53.9 million from the $100 million COVID-19 Regional Airlines Funding Assistance Program.

According to Rex Express on 20 April 2020 the RANS program is to ensure “regional airline carriers will be provided assistance to maintain a minimal weekly schedule to regional and remote ports”. The COVID-19 Regional Airlines Funding Assistance Program is intended to assist airlines "to remain financially viable through the unprecedented downturn in aviationdue to the impact of the COVID-19 pandemic".

Under revised RANS guidelines, Rex was eligible to receive funding to operate 2-3 return services a week to all destinations on the Rex Express network for up to six months. Rex’s application for the ports it wishes to provide services to has been approved and was signed off on 23 April 2020.

So it seems that the airline had a government funding offer to fly the Clarence Valley route until at least late September 2020.

So why did Rex Express spit the dummy and pull its Clarence Valley route commencing 3 July?

Admittedly Rex Express as airlines go is only a sprat in the aviation ocean, however it did turn a $17.5 million profit after tax in the 2018-2019 financial year and the board recommended an 8 cents dividend to shareholders.

Perhaps dropping Grafton Airport was because having a leg in again at Ballina Airport since early May 2020, the company board finds that market is more attractive.

Or perhaps it has more to do with the changed financial landscape created by the COVID-19 pandemic and the likelihood that the profit & loss statement it will present shareholders at this November’s annual general meeting - given it stated an expectation of a $10 million a month loss due to reduced flights - will not be welcome.

Total passenger numbers and revenue had been falling in 2019 but the fall was quite marked in January-February 2020 – numbers fell by -4 % in January & -3% in February and revenue fell by -6% in January & -5% in February.

By 17 March 2020 it was reported that Rex Express was anticipating bankruptcy and on 26 March its ASX share price had dropped to 0.400. Share price has since recovered to 1.100 as of Friday 5 June.

The regional airline is also now facing increased competition on some routes from Qantas which is expecting competition from Regional Express in 2021. Rex wants to expand its own operations on competitive/commercially viable routes.

It is possible that Rex Express abandoning its flights into the Clarence Valley will not be the only route it is either jettisoning or downgrading and other low volume regional areas are in the firing line – they just don’t know it yet.

It may be that the fig leaf Rex is hiding behind – alleged hostility during one Clarence Valley Council debate of a motion – is meant to forestall panic in other regions this airline services.

Either way, I have lost count of the times Rex Express has threatened to withdraw or did withdraw its passenger services from airports in the NSW Northern Rivers region. In my personal opinion it is an airline that fails to impress.

Note

* Rex Express is reportedly 58% owned by shareholders in Singapore.

BACKGROUND

The Daily Examiner, 8 June 2020:

Seven-line email to council over ‘hostility’ the reason Grafton stunned by Rex king hit

The words used in a Clarence Valley Council meeting last week are the reason Regional Express airlines will cease flying into Grafton from July 3.

The airline made the announcement to cease flying via a letter to Clarence Valley Council general manager Ashley Lindsay on Thursday afternoon.

A spokeswoman for the airline confirmed to The Daily Examiner that the reason for the cancellation of the route was due to the comments made by councillors in a debate over whether they would provide a credit note for the airline.

When pushed on other reasons for the closure of the route, and whether Rex’s Lismore and Ballina routes would continue, the spokeswoman declined to comment, and said that further questions from The Daily Examiner had been forwarded for consideration.

The motion for providing Rex a credit note of $8908, which was to be used in January 2021, was passed by Clarence Valley Council 7-2 after a debate ensued on whether councillors questioned council supporting the airline.

However in the letter, the company has stated it has rejected the offer, despite asking for it in earlier correspondence.

Written by Rex airports manager David Brooksby, it opens by thanking Clarence Valley Council for offering Rex a rebate of $8908.

“Please note however that given the hostility of the councillors in relation to this matter, and following the call for Rex to ‘pull their finger out’, Rex will reject council’s offer. Full settlement has already been made last week,” the letter reads.

It concludes: “Please also be aware that Rex will cease all services to Grafton with effect from 3 July 2020.” Clarence Valley Council general manager Ashley Lindsay said the decision was “really surprising and disappointing”, and was seeking to talk to Mr Brooksby about the matter.

“Council received correspondence from Rex on March 19 and requested that council provide a 50 per cent reduction of the head tax from April 1 to December 31, 2020,” he said.

“Council in March resolved to give a reduction of 100 per cent unanimously. “We then received further correspondence on April 23 seeking a credit note over landing fees … that could used in January 2021 for their first lot of invoices.

“This was passed 7-2 … and it seems the ‘pull your finger out’ (comment from the debate), that’s what has offended them…..

NSW Labor MLA for Lismore Janelle Saffin speaks out about Nationals support of extensive coal seam gas exploration and mining in New South Wales

Janelle Saffin, Labor MLA for Lismore, media release, 4 June 2020:

Ben ‘Fracker' Franklin should pack up his Byron Bay digs and head back to Sydney: Saffin

STATE Member for Lismore Janelle Saffin today (Thursday 4 June 2020) slammed the NSW Nationals for voting against a Private Members Bill that would permanently protect the Northern Rivers from harmful Coal Seam Gas mining.

“Byron Bay-based Parliamentary Secretary for Energy and the Arts Ben Franklin and his fellow Nationals did a 360-degree turn last night hoping no one would notice and sought to turn the guns on others,” Ms Saffin said.

Ms Saffin said with the bill due to be debated in the Legislative Assembly today (June 4), she would be watching to see whether North Coast-based Nationals MPs Gurmesh Singh (Coffs Harbour), Chris Gulaptis (Clarence) and Geoff Provest (Tweed) would become turncoats as well.

“If these MPs are serious about protecting the Northern Rivers and North Coast they will vote for this bill,” Ms Saffin said.

“In 2015 at the Nationals’ State Conference, Ben Franklin seconded a motion put by Chris Gulaptis, calling for the need to recognise widespread opposition to CSG and to buy back CSG licences.

“Ben Franklin then warned that a solution was needed otherwise the Nationals could lose the seats on the Northern Rivers for a generation, and that ‘if we do not get this right the people of the Northern Rivers will not listen to us on anything else’

“You got that right Ben as you lost another seat, Lismore in 2019 and went backwards, and the people of the Northern Rivers will never listen to you or your Nationals mates again.

“You had the chance to protect the water, the farmers, the agricultural industry in the Northern Rivers and Narrabri, and you ran away from it.

“Ben ‘Fracker’ Franklin should pack up his Byron Bay digs and head back to Sydney, because he has sealed his fate by putting city interests ahead of country people.”

Ms Saffin accused the Nationals of not being serious about protecting our people, our water, our farmlands and our agricultural jobs in the Northern Rivers from the harmful effects of CSG.

“They are only serious about protecting their own jobs, whether it be the Deputy Premier spot or a seat they “claim” as theirs as of right,” Ms Saffin said.

“They only reacted to electoral loss for them -- losing the state seat of Ballina and nearly losing Lismore in 2015. It was not support and protection for us; it was ‘jobs’ protection for them.

“I stood up against Metgasco when I researched and discovered the harmful effects of CSG mining. I took it into the Federal Parliament and advocated hard to get whatever power the Federal Government had in this matter enacted to protect our water.

“I helped secure ‘water trigger’ legislation which was subsequently weakened by the Abbott Government and the Nationals.”

Ms Saffin said the Petroleum (Onshore) Amendment (Coal Seam Gas Moratorium) Bill 2019, has the following key elements:

* It imposes a moratorium on the prospecting for, or the mining of, coal seam gas across New South Wales.

* It applies no-go zones to particular areas deemed off limits, including the local government areas of the Northern Rivers region, drinking water catchments, national parks, residential areas and prime agricultural land.

The Northern Rivers is made up of Tweed Shire, Byron Shire, Ballina, Lismore City, Kyogle, Richmond Valley and Clarence Valley.

Ms Saffin said: “Farmers want the permanent protections of this bill, locals want this, anyone who cares about water wants this -- that is all of us -- the agricultural, fishing tourism sector want this.

“I have advocated for a statewide CSG moratorium to my NSW Labor colleagues and indicated that I would cross the floor of Parliament if I had to,” Ms Saffin said.

“The 2019 bill is similar to (NSW Shadow Minister for the North Coast and Shadow Minister for Climate Change) Adam Searle MLC’s 2015 bill so we (Labor) have a long history of standing up to protect the Northern Rivers.

“I also moved a motion at NSW Labor’s State Conference to create no-go zones here on the Northern Rivers.”

This Is Not Journalism or How A 165 Year Old Australian Masthead Finally Lost Its Good Name

The Age newspaper has been read in Melbourne since October 1854.

Over the years it grew in circulation until it was read across the state of Victoria and elsewhere in Australia.

It has survived the vagaries of the print newspaper business, until the Fairfax-Nine Entertainment merger when it became part of a media group whose chairman was a former Liberal MP and onetime Australian federal treasurer Peter Costello and its CEO began courting the Liberal Party by hosting a $10,000 dollar a head party fundraiser at its headquarters in 2019 raising at least $700,000 for the party.

It is no secret that the current Federal Liberal-Nationals Coalition Government dislikes the Victorian Labor Government and is out to criticize and undermine it at every opportunity.

So when this front page headline appeared in The Age on 5 June 2020, "Activists 'planning trouble' at protest: Exclusive", under the bylines of the newspaper's State Political Editor and a general news journalist, it came as no surprise.

The opening paragraphs ran thus:

Activists have threatened police with spitting, inflammatory chanting and other forms of physical abuse during tomorrow's "Black Lives Matter" protest in Melbourne in an attempt to provoke use-of-force responses from officers. 

A senior government source told The Age police were preparing for tactics from some protesters tomorrow designed to provoke physical confrontation and produce images of police brutality. [my yellow highlighting]

The newspaper amplified this message on social media:

The online copy of the original article in question has since been removed. With the current online article now having a different headline and and text much altered from the original.

The apology issued by The Age and published on 6 June on the second page of the print newspaper, contains a meas culpa for its lapse in "editorial standards and values". However, this creates another issue surrounding these values.

It completely omitted mention of the "senior government source". Instead the apology states "one unnamed source".

The Age, 6 June 2020, p.2:

Apology 

On June 5, The Age published a story headlined: "Activists 'planning trouble' at Protest". 

This story reported concerns within the Victorian government about the potential for physical confrontation during planned protests. 

The story fell short of The Age's editorial values and standards and caused understandable offence to many members of the community. 

The claim that activists had threatened police with spitting and abuse was not backed up beyond one unnamed source. 

The story put undue emphasis on these claims. The main organisers of the rally, the Warriors of the Aboriginal Resistance, clearly stated that they had no knowledge of any threats to police. The Age apologises. [my yellow highlighting]

It certainly differed from the "clarification" displayed under the current online article posted at 11:45pm the night before:

One has to wonder if, between the publication of that original inflammatory article and the final print apology, management began to hedge its bets because the "source" cited appeared highly suspect and may not have been a source in government or even close to government and that there was a possibility that The Age's journalists had been played.

Riddle me this.....

Q: What do Australia’s National Disability Insurance Scheme, the federal drought relief plan, bushfire recovery response funding and COVID-19 pandemic response have in common?

A: It seems the answer to this riddle is Morrison Government mismanagement, parsimony and, an almost pathalogical inability to keep policy promises.

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The National Disability Insurance Scheme (NDIS) commenced on 1 July 2013 and had an annual budget of $148.8 million. The initial 2013-14 budget was underspent by $18 million.

In the following financial years NDIS ran an operating surplus of $0.4 million in 2014-15, $15.8 million in 2015-16, $617 million in 2016-17, $146 million in 2017-18 and $ 694.4 million in 2018-19.

Despite growing concerns about the slow rollout of this scheme and allegations of poor services and needs not met, in 2018 est. $1.6 billion dollars was removed from NDIS and returned to federal government coffers to bolster that financial year's budget bottom line.

~~~~~~~~~~~~~~~~~~~~~~

On 1 September 2019 the $5 billion FutureDrought Fund was created by siphoning $3.96 billion from the Building Australia Fund. It consists of the Future Drought Fund Special Account and the investments of the Future Drought Fund. Fund earnings are to be reinvested until the balance reaches $5 billion (expected in 2028-29).

As of 31 March 2020 the Future Drought Fund was holding $3.99 billion, of which a total of $23 million is net earnings – an investment return of only 0.7 per cent. From 1 July 2020 there is a Morrison Government undertaking that the poorly performing fund will transfer $100 million each financial year to the Agriculture Future Drought Resilience Special Account despite the fact that it does not have the required balance of $5 billion.

~~~~~~~~~~~~~~~~~~~~~~

On 6 January 2020 Prime Minister & Liberal MP for Cook Scott Morrison announced the federal government would allocate $2 billion for the National Bushfire Recovery Fund (NBRF).

At the time of the announcement $1.6 billion was unallocated.

The 2019-20 bushfire season officially ended on 31 March 2020.

As of 15 May 2020 only a total of $1 billion of the $2 billion in NBRF funding has been spent.

Of the 26 programs being funded by NBRF: 6 do not commence until 1 July 2020; only 3 have fully spent allocated funding with another demand driven program running over budget (funding provided to farmers, fishers, and foresters located in declared bushfire affected areas); and, the remaining 16 programs have spent from 0% (mental health support for emergency services workers) to 89% (additional emergency relief delivered by charities, plus financial counselling) of their allocated funding.

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On 20 March 2020 the Minister for Aged Care and Senior Australians & Liberal Senator for Tasmania Richard Colbeck announced temporary funding to support Aged Care providers, residents, staff and families - including $234.9 million for a COVID-19 ‘retention bonus’ to ensure the continuity of the workforce for aged care workers in both residential and home care.
This retention bonus would have seen a total of $1,600 tax-free paid in two installments to direct care workers and $1,200 tax-free paid in two installments to those providing care in the home.

However, by 5 June 2020 and ahead of the first installment being delivered, the Morrison Government announced a change to the 'retention bonus'. The bonus will now be capped at $800 for direct care workers, $500 for those providing care in the home and will now be taxed at the individual's marginal tax rate with most aged care workers losing est. >30% of the bonus. 

This measure is expected to save the Morrison Government somewhere in the vicinity of $50 million.

~~~~~~~~~~~~~~~~~~~~~~

On 31 March 2020 Scott Morrison headed a joint media event with two of his ministers at which it was announced that the federal government was committing $50 million to fund 3.4 million meals for 41,000 older and/or vulnerable people for 6 weeks – the equivalent of two meals a day for which there is a cost to Meals-on-Wheels clients. In addition $9.3 million was set aside to buy 36,000 emergency food supplies boxes to assist this same group to stay safe at home.

The purchase cost to government of these food supply boxes averages out at ext. $258 per box. It does not appear to be value for money.

On 5 June 2020 The Guardian revealed that only 38 food supply boxes had been delivered to date. In all probability because the contents of these boxes were decided by individual grocery chains and came at a cost to vulnerable recipients of $80 per box from Coles and Woolworths.

An additional impediment was that the Morrison Government initially restricted food supply box eligibility to people over 70 years of age who were registered with the National Disability Insurance Scheme or My Aged Care. This locked out so many older Australians with health condtions which made potential exposure to COVID-19 infection high risk.

Now desperate to rid itself of the remaining 36,962 boxes the only eligibility requirement seems to be that you are a registered online customer of a supermarket chain.

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And the bad news concerning Abbott-Turnbull-Morrison Government rorting just keeps coming

The New Daily, 1 June 2020:

I was wrong. The Community Development Grants program isn’t the Coalition’s hot $1.126 billion political rort – it’s the Coalition’s hot $2.5 billion-plus political rort.

It’s not 11 times bigger than #sportsrorts, it’s 25 times bigger and counting.

The government has a number of corrupt slush funds, but none more blatantly designed to buy votes with taxpayers’ money than the CDG scheme purpose built in 2014.

As reported last week, analysis of the government’s GrantConnect website showed Coalition seats “luckily” scored 75.5 per cent of last year’s CDG money, while Labor seats managed just 19.9 per cent.

Of the 68 federal seats Labor now holds, 22 have never received a cent in CDGs while those that did score well tend to be of particular political interest or history.

And the Coalition has quietly arranged to keep this particularly rich pork barrel rolling for another six years.

As Michael West Media has posed, why buy one election when you can buy three?

Billions of dollars in corrupt pork barrelling can seem a little abstract, so using Vince O’Grady’s spreadsheet analysis, I’ve chosen an example of a frontline seat and those that adjoin it to demonstrate how much an Australian Electoral Commission boundary costs or benefits communities.

The Labor-held seat of Hunter in regional New South Wales abuts three National seats to its west and north.

It is a particularly rich green line that separates Hunter from the Nationals’ Calare, Lyne and New England.

Since the Coalition invented CDGs in 2014 through to and including the 2019 election year, only $108,000 in CDGs show up on the GrantConnect site for the good folk of Hunter.

Source: AEC map; TND graphic

…..CDGs are not supposed to be purely regional grants – some of the biggest winners are rich Liberal-held city seats – but it is the National Party that has done by far the best out of the way this barrel has rolled.

In 2019, the 68 Labor seats averaged $836,000 in CDGs, Liberal seats $2.086 million, LNP seats in Queensland $2.473 million – and the 10 National Party seats scored an average of $6.712 million.

That contrast is stark on the ground……

As previously reported, the CDG process was designed by the newly elected Abbott government to avoid any embarrassing involvement of public servants in divvying up the spoils, as subsequently happened with the McKenzie/Morrison #sportsrorts scandal, and the $100 million environment grants program that was also conveniently established before the 2019 election.

Read full article here.

Berejiklian Government determined to expand coal seam gas mining in New South Wales voted down bill to reintroduce the public interest as a ground for certain decisions relating to petroleum titles and impose a moratorium on CSG exploration & mining

The Sydney Morning Herald, 4 June 2020: 

The Berejiklian government has rushed to defeat a private member's bill to derail the controversial Narrabri gas project, as anti-coal seam gas groups were preparing to target National party seats. 

In a rare move, the Coalition suspended the day's parliamentary agenda on Thursday to debate a coal seam gas moratorium bill, in a bid to fast-track its demise in the Legislative Assembly. 

It comes after the bill, put forward by independent MP Justin Field, passed the NSW upper house on Wednesday night with the support of Labor and the Shooters, Fishers and Farmers Party. 
 

Santos's Narrabri project could supply up to half of NSW's gas needs.CREDIT:DEAN SEWELL

 
The bill, which the government voted down in the lower house, sought to impose an immediate moratorium on the prospecting or mining of coal seam gas in NSW, and classifies certain areas as permanent "no go zones". 

One of these zones is the Great Artesian Basin recharge zone, which covers part of the area for Santos' proposed $3 billion project to drill 850 gas wells in Narrabri, northern NSW, many of them within the Pilliga state forest. 

Deputy Premier John Barilaro attacked the Shooters party - the Nationals' key rivals in the bush - for their "unholy alliance" with Labor and the Greens in supporting the bill, which he said would "destroy" jobs..... 

Coal seam gas mining has long been a vexed issue for the National Party, amid fierce opposition from farmers and community groups. It was a key factor in the party losing the northern NSW seat of Ballina to the Greens at the 2015 election. 

Shooters MP Roy Butler, whose seat of Barwon includes the township of Narrabri, said the "vast majority" of his electorate opposed coal seam gas, predominantly out of concern for groundwater contamination. 

"The reality is if you don't have a good domestic supply of water in a town like Narrabri, Coonamble, any of those places, it doesn't matter how many jobs you've got, because you're not going to have anyone in the town," Mr Butler said..... 

BACKGROUND 

Petroleum (Onshore) Amendment (Coal Seam Gas Moratorium) Bill 2019 [NSW]Explanatory note

The first and second reading of this bill occurred on 22 August 2019.

In the vote of 5 June 2020 which defeated the bill both Nationals MP for Clarence Chris Gulaptis and Labor MP for Lismore Janelle Saffin were designated as "Pairs" and therefore deemed absent from the vote.

Coaltion Government MLAs who voted down the bill and their electorates:

Anderson, K. (Tamworth) Ayres, S. (Penrith) Barilaro, J. (Monaro) Berejiklian, G. (Willoughby) Clancy, J. (Albury) Conolly, K. (Riverstone) Constance, A. (Bega) Cooke, S. (Cootamundra) Coure, M. (Oatley) Crouch, A. (Terrigal) Davies, T. (Mulgoa) Dominello, V. (Ryde) Elliott, D. (Baulkham Hills) Evans, L. (Heathcoate) Gibbons, M. (Holsworthy) Griffin, J. (Manly) Henskens, A. (Ku-ring-gai) Johnsen, M. (Upper Hunter) Kean, M. (Hornsby) Lee, G. (Parramatta) Lindsay, W. (East Hills) Marshall, A. (Northern Tablelands) O'Dea, J. (Davidson) Pavey, M. (Oxley) Perrottet, D. (Epping) Petinos, E. (Miranda) Preston, R. (Hawkesbury) Roberts, A. (Lane Cove) Saunders, D. (Dubbo) Sidgreaves, P. (Camden) Sidoti, J. (Drummoyne) Smith, N. (Wollondilly) Speakman, M. (Cronulla) Taylor, M. (Seven Hills) Toole, P. (Bathurst) Tuckerman, W. (Goulburn) Upton, G. (Vaucluse) Ward, G. (Kiama).

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