Our Submission to the Senate Inquiry into Regional Aviation

October 2026. Rick Howell (Honos Group) and Neville Hodges (QC Aviation Group), Submission 66.

The Senate Rural and Regional Affairs and Transport References Committee is inquiring into the state of Australia’s aviation sector and its ability to deliver reliable and affordable services to rural, regional and remote communities. With Neville Hodges of QC Aviation Group, I lodged Submission 66 to the inquiry, and we gave evidence to the Committee in Canberra on 16 October 2026.

The submission makes six interconnected recommendations. Its central argument is that regional aviation is nation-building infrastructure, and deserves systematic, sustained support rather than episodic grants to carriers in difficulty.

The six recommendations

1. Rebalance infrastructure funding
Move Commonwealth support for regional airports from episodic, competitive grant rounds to guaranteed multi-year capital funding, so that councils can plan with certainty, with clear priorities for runway safety, terminals, navigation aids and emergency facilities.

2. A government-owned regional aircraft program
Establish a Commonwealth-owned fleet of modern regional aircraft, leased to regional airlines at concessional rates. Lease terms are structured to cover the aircraft’s depreciation, protecting the Commonwealth against residual-value risk and keeping the program capital-neutral over the life of the fleet. It is the model already used for government-owned trains and ferries.

3. National security cost equalisation
Fund the fixed cost of federally mandated security screening at smaller regional airports nationally, so that it no longer falls on the few passengers who use them.

4. Legislated public service obligations
Introduce a formal public service obligation framework that guarantees essential regional air services, with specified frequencies, fare caps and continuity requirements, starting with pilot routes and expanding over time. Service continuity would no longer depend on any one carrier's commercial survival.

5. Infrastructure and decarbonisation partnership
Invest in the infrastructure and partnerships needed for lower-emission regional flying: sustainable aviation fuel, hybrid-electric and hydrogen aircraft development, and demonstration programs on high-frequency routes. Replacing an ageing fleet with modern turboprops is itself the first step.

6. A National Regional Aviation Authority
Create a dedicated agency to run the program as a whole: aircraft procurement and leasing, route designation, carrier contracts, infrastructure grants and performance monitoring, reporting annually to the Senate.

Priorities

We asked the Committee to give priority to three of the six: the government-owned aircraft program (Recommendation 2), national security cost equalisation (Recommendation 3) and legislated public service obligations (Recommendation 4).

Read the submission

Submission 66 is published in full on the Parliament of Australia website (PDF, 108 pages).

We provided the Committee with updated information on 16 October 2026. It will be available here once the Committee has published it.

For the case for the aircraft program in brief, see my Australian Financial Review opinion piece, “Canberra already funds regional aircraft. It just funds the old ones”.