It has been nearly a year since Rex Airlines cancelled its services in the South Australian city of Whyalla and the knock-on effects are being felt.

The latest Essential Services Commission of SA (ESCOSA) report has again labelled Whyalla City Council “unsustainable”.

According to the report the airport, which is owned and operated by the council, is the biggest contributor to the council’s debt.

“Airport operations show an accumulated operating deficit of $2.8 million over the last five years [from 2018-19 to 2022-23],” the report said.

“With airport operations excluded, the council registers a $1.3m surplus over this period.

“Between 2023-24 and 2032-33 the council is forecasting an accumulated loss of nearly $5m, primarily due to the Whyalla Airport.”

Rex Airlines ceased flying routes to and from Whyalla in July last year after Whyalla City Council attempted to pass on a $35-$40 per head passenger security fee, which was a split of an $80 per head fee with Qantas.

Whyalla Mayor Phill Stone says the council has repeatedly asked for federal assistance.(ABC News: Brant Cumming)

Calls for national levy

The City of Whyalla introduced the levy after federal funding to help support the initial implementation of security screening ceased.

Mayor Phill Stone said council had strenuously lobbied the federal government to introduce a national levy so smaller airports were not disadvantaged.

“Our council put submissions left, right and centre that if the government charged every single passenger at every airport 75 cents that would cover the entire cost of screening nationally,” he said.

“The response was, ‘Oh that’s a bit ambitious, that’s a bit too big. We can’t cope with that at the moment — you guys just go out and sort yourselves out.'”

Rex Patrick says the federal government needs to take responsibility.(ABC News: Lincoln Rothall)

Before he departed from parliament, former senator Rex Patrick held several inquiries in regional Australia.

He also advocated for a national levy for security screening to keep airfares down.

“That’s the approach they adopt in the United States and that’s the approach they ought to be adopting here in Australia,” Mr Patrick said.

“No-one is going to question security advice that says ‘You need to have security screening at airports.’

“[But] these are national security requirements and the government is saying it’s for the local regions to cover these national security costs — that simply doesn’t make sense.

“National security is a national problem.”

Whyalla Airport is being operated at a loss of about $800,000 a year, according to Cr Stone.(Supplied: Whyalla City Council)

Passenger numbers plummet 

Now that Rex Airlines no longer services Whyalla the council has passed on the $80 per head security screening fee to Qantas.

Cr Stone said that had partially contributed to the rise in airfares to and from Whyalla.

Prior to the pandemic and before security screening was introduced about 1,500 passengers travelled through Whyalla Airport per week.

That number now has dropped to roughly 900 a week.

Cr Stone said the airport’s operating costs had stayed more or less static but the drop in passengers had caused a severe loss in revenue.

“We’re losing about $800,000 per year operating the airport,” he said.

Rex Airlines ceased flights in and out of Whyalla in July 2023.(Wikimedia Commons: Bidgee)

Member for Grey Rowan Ramsey said he was incensed that the council had been left in a “no-win situation”.

“This is pretty much what I warned would happen,” he said.

“Now, if they want Whyalla to be the jewel of the north, the hydrogen hub of South Australia, well, they’re going to have to start digging into their own pockets.”

Cr Stone said he could not comment on whether the airport could be sold off or closed.

“Unfortunately that’s a hypothetical question I can’t answer at the moment,” he said.

Mr Stone said he was due to meet with representatives from Qantas to discuss airfare prices.

Infrastructure, Transport, Regional Development and Local Government Minister Catherine King was contacted for comment.