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The former Transport Minister credited for saving Rex during the pandemic has conceded the airline took advantage of its rescue package.
However, Michael McCormack also praised the regional carrier for its “bold” decision to launch capital city jet services against Qantas and Virgin.
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It comes days after Rex entered voluntary administration and effectively grounded all of its 737 operations, following days of speculation.
On Friday, McCormack told The Australian he still had “no qualms” about supporting the airline in 2020 and argued the then-Labor opposition was supportive.
“At the time, I was accused of being the Minister for Rex,” he said. “I wore that as a badge of honour because Rex saved lives during the Covid pandemic.
“They have decided to take on the big boys and now they’re in the situation they’re in, financial freefall. It’s not the only reason, but it has to be a factor.
“It was a bold move, a brave move. Ultimately with what’s happened this week it hasn’t been a successful move.
“I hope they have the ability with government help to get their way out of it. I hope regional Australia make Rex its airline of choice. I hope they recover from that and get back to where they were.”
Rex, along with other regional carriers, secured a number of deals from both regional and federal governments to supplement flights during COVID-19.
The most significant, though, was the Regional Airline Network Support (RANS) program, which offered hundreds of millions to support airlines and companies that supported the industry.
It followed Rex issuing a desperate ultimatum to the government in 2020, claiming it would shut down its services if it didn’t receive an immediate bailout.
Yet just months later, Rex signed off on a $150 million investment to launch flights between Sydney, Melbourne and Brisbane using a fleet of leased 737 aircraft.
Rex eventually named one of its 737s after McCormack, VH-MFM, and the former Minister was invited to attend the airline’s 20th anniversary.
McCormack’s surprise intervention comes a day after former ACCC chair Rod Sims condemned what he called a “failure of public policy” that led to Rex’s downfall.
Speaking on ABC Radio National on Thursday morning, Sims insisted that the Australian aviation market can sustain more competition but said this is being held back by poor policy settings around slot management at Sydney Airport.
The federal government this year decided against changing the “80/20 rule”, which allows airlines to keep a take-off slot indefinitely provided they operate it at least 80 per cent of the time – effectively punishing new entrants.
“We certainly can have more than two airlines on these capital cities routes, certainly on the Melbourne-Sydney route. But public policy is simply stopping that happening, and I don’t know why,” Sims said.
