IN direct response to what it calls “a serious breach of a commercial agreement” and “a blatant money grab” by Mildura Airport Corporation, Regional Express (REX) announced on Wednesday that it will cancel and/or reduce its services between Mildura and Adelaide, Sydney and Broken Hill.

In a written statement, REX said it had been forced to review the viability of existing air services to Mildura, after Mildura Airport (MAPL) significantly increased its airport charges.

REX claims the move is a serious breach of the partnership agreement in place between the two parties.

The statement went on to say that in May 2017, MAPL and REX extended the partnership for a further three years, an agreement which saw REX provide daily direct flights from Mildura to Adelaide, Sydney and Broken Hill, in addition to Melbourne.

The carrier says that less than 13 months later, on June 15 this year, MAPL provided notice to REX of a 22.5 percent increase to the Mildura Airport ‘head tax’, which was to take effect from July 1, and be applied across all routes.

The airline said that after discussions, this was revised by MAPL to a 13.7 percent increase, which will now be applied from October 1 this year, but only applicable to the Melbourne route.

Mildura Airport Chair, Peter O’Donnell, said Mildura Airport was surprised and disappointed at REX’s sudden announcement.

“As a major regional carrier, Rex is relied upon by a lot of people across our district, so to hear this news is a surprise,” he said. “REX has blamed its decision on increased airport charges, which it suggests breaches an existing agreement.

“The facts here are quite simple – the airport has to operate in the black, and like any other business, we have to occasionally increase our fees.”

Mr O’Donnell said that the increase was equivalent to about two dollars on a ticket to Melbourne.

“We believe that is a minimal amount – half a cup of coffee,” he said. “Furthermore, the agreement we have with REX does not cover this route (Mildura to Melbourne), and to say otherwise is simply not accurate.

“For the good of people across Sunraysia, the Board will contact REX to continue negotiations and try to find a sensible solution.”

For its part, Rex said it wished to apologise to the local community “whose socio-economic fabric will be greatly impacted by this loss of critical air services, and remains ready to re-engage with Mildura when there are more enlightened policies in place at the airport.”