NZ: Government allocates additional $170m in airline subsidies, indicates more could be on offer

The Government has set aside an additional $170m in airline subsidies to keep air cargo links open through to October, and will consider extending the relief to March if necessary, the transport minister says. As part of a $600m package to support the aviation industry through Covid-19 the Government spent $370m to keep air cargo moving by subsidising airlines via an International Airfreight Capacity scheme. New Zealand’s closed borders and record low passenger numbers resulted in air cargo capacity dropping, and sent the cost of freight skyrocketing. Transport Minister Michael Wood​ said the scheme was restructured in March, and replaced with the Maintaining International Air Connectivity scheme, allowing for airline support to reduce as passenger numbers increased. “Securing our recovery is a key focus for the Government and we are carefully watching the international aviation market,” Wood said. It would consider extending support beyond October to a final date of March if necessary, he said. Airfreight capacity was at 90% of pre-Covid levels thanks to the schemes, which helped keep trade channels open and maintain supply of time-critical goods like medicine into New Zealand, he said.<br/>