The Government is allocating another $170 million to support the aviation sector through to the end of October 2021 to keep freight flowing and maintain international passenger services.
It says more funding will be available after that date if needed.
The Airfreight Capacity (IAFC) scheme was announced in May last in response to the pandemic and to support economic recovery. From this, $372m has been allocated to support air freight connectivity.
This is being drawn from the $600m set aside for the aviation sector as part of the Government’s $12.1b COVID-19 support package.
The scheme has supported over 6000 flights carrying over 120,000 tonnes of airfreight worth $8b since its launch.
Transport minister Michael Wood says airfreight capacity is at 90% of pre-COVID levels thanks to the scheme.
This has allowed exporters to get their products to market and time critical goods like medicine have been able to come into New Zealand, he says.
It has also supported international travel with more than 60,000 people who have returned to New Zealand flights supported by the scheme – 60% of the total number of people to pass through MIQ facilities.
“It’s unlikely those journeys or the freight moved would have been possible without support from the IAFC scheme,” Wood says.
“The scheme has also maintained a critical lifeline for our Pacific partners – there would have been no flights to Tonga, Samoa, the Cook Islands and Nuie without it.
“The aviation market will likely start to rebuild later this year, so we’ve changed and restructured the scheme to focus on the recovery.
“Going forward, the support programme will be called the ‘Maintaining International Air Connectivity’ (MIAC) scheme and it allows for support levels to reduce as passenger numbers rise, giving good value for money,” he says.
“International air travel essentially shut down as the virus spread, so the threat of isolation from global partners was very real. Extending support gives a predictable and regular schedule of air services to safeguard New Zealand’s international connectivity.
“Officials are closely working with airlines and carriers, and are monitoring the international aviation market. We will consider extending support until the end of March 2022 if necessary,” Wood says.
New proposals from airlines and carriers for the MIAC scheme are now being sought by the Ministry of Transport. Existing support agreements with airlines and carriers under the IAFC scheme are due to expire at the end of April.
A win for exporters
The extension of the aviation relief package to the end of October gives certainty to under pressure exporters, ExportNZ executive director Catherine Beard says.
“ExportNZ has been advocating for this support to be extended as the COVID-19 fallout has continued into 2021.
“While freight costs remain well above pre-COVID levels, the extension shows the Government’s commitment to support exporters until costs come down and disruptions ease.
“The Government says it will consider extending support until the end of March 2022 if necessary, a commitment that will give greater confidence to airlines and exporters,” Beard says.
