Govt to meet half Chatham air rise

Press, 16 August 1978, Page 10

Govt to meet half Chatham air rise

PA Wellington A Government subsidy on Safe Air Flights to the Chatham Islands might exceed $259,000 if passenger fares and freight rates did not rise, the Air Services Licensing Authority heard. Evidence was being given by the chief executive officer of the Local Government Division of the Internal Affairs Department (Mr T. O’Brien) who said that half the proposed fare and freight increases would be met by the Government under its subsidy. Mr O’Brien supported the application by Safe Air for passenger fare increases of $2O for adults and $lO for children in single trips, and a freight rate increase of 10 per cent. The increased fares will make a single adult journey to the Chathams from Wellington $B6, and from Christchurch $108; children’s fares will be $43 and $54, respectively. Mr O’Brien said the Government recognised that the service was essential to the Chathams. The Government also considered that to recover the full increased costs from fares and freight charges would have considerable im-

pact on all sections of the Chatham Islands community. But, he said, the Government subsidy on the service in the last financial year amounted to $184,000 and, if no increase was applied, the subsidy for the present financial year might have to exceed $259,000. The authority will sit in the Chathams today. While the annual subsidy would rise to about $200,000 in a full year if the rates applied for were approved, it was expected to be about $229,500 this year because the increases would be applying to only about six months of the financial year, said Mr O’Brien.

Objectors at Monday’s hearing in Wellington included the Chatham Islands County Council and the islands’ branch of Federated Farmers. The Chatham Islands service is run under contract between Safe Air, the Government and Air New Zealand; and Mr O’Brien said that this contract, which expired in January, was now being renegotiated. He told the authority that Safe Air had been told by the department to make the application.