Legislative Council, Thursday 29 October 2026
Ms FORREST question to MINISTER for INFRASTRUCTURE and TRANSPORT, Mr VINCENT
QUESTION:
- What is the total value of Tasmania Government funding provided to Sharp Airlines for King Island to mainland Tasmania and King Island to Melbourne services, broken down by financial year for 2024-25, 2025-26 and 2026-27; and what is the term and expiry date of the current agreement?
ANSWER:
Funding of $189,000 was provided for the 2025-26 summer season, covering 1 November 2025 to 30 April 2026.
The current Grant Deed provides up to $260,940 for services from 1 October 2026 to 30 April 2027, when the agreement expires.
No funding was provided in 2024-25.
QUESTION: - Is the funding a fixed payment, a per-service payment, an underwrite of seats, or another arrangement?
ANSWER:
The funding is a capped contribution of up to $260,940. Payments are made on a monthly basis to offset the gap between the airlines agreed operating costs and flight revenue on a per-flight basis.
QUESTION: - What minimum service delivery requirements are attached to the funding, including:
(a) the minimum number of weekly return services;
(b) minimum seat capacity;
(c) required days and times of operation, including seasonal variation; and
(d) reliability and on-time performance standards?
ANSWER:
The Grant Deed does not set a minimum number of services to be delivered as this is ultimately a commercial decision, based on market demand. The committed public funds assist with offsetting commercial risk.
The Grant Deed provides for up to four services per week in October increasing to up to six services a week for peak travel dates over January to March 2027 between Melbourne and King Island.
Flights are operated using a standard aircraft type – the Metroliner – which provides 19 passengers seats on each leg.
There are no on-time performance standards set in the Grant Deed. If a service does not operate, Sharp is not eligible for any funding for that cancelled flight.
QUESTION: - Does the agreement permit Sharp to cancel scheduled services for commercial reasons such as low passenger loads? If so, under what conditions, and what notice must be given to the Government and to passengers?
ANSWER:
Yes. The Grant Deed permits Sharp to cancel a scheduled flight where passenger demand is low. The Grant Deed requires Sharp to notify the Tasmanian Government within two business days of the cancellation or before the scheduled departure, whichever occurs first.
Notification of customers is managed by Sharp Airlines as part of normal business operations. The Grant Deed does not specify a minimum notice period for customers, as this is a commercial matter for Sharp Airlines.
QUESTION: - Does a cancellation for soft loads count against Sharp’s contracted service obligations, and are there abatement, penalty or claw-back provisions where contracted services are not delivered?
ANSWER:
The Tasmanian Government is making a funding contribution, through a grant deed, to support delivery of a commercial service schedule determined by Sharp.
There are, therefore, no abatement, penalty or claw-back provisions where services are not delivered. The Grant Deed provides that no funding is payable for the service which has been cancelled.
QUESTION: - How many cancellations have there been by Sharp Airlines, and the reasons for these cancellations, for the financial years 2024-2025, 2025-2026 and 2026-2027.
ANSWER:
The management of this operational data is a responsibility of Sharp Airlines.
QUESTION: - What performance reporting does Sharp provide to the Government, how often, and is it published?
ANSWER:
Sharp provides monthly operational, patronage and financial reports during the funding period, followed by a final acquittal report, covering services operated, aircraft capacity, bookings, load factors, operating costs, passenger and freight revenue, and subsidy claimed.
The information is not published because it contains commercially sensitive operational and financial data.
QUESTION:
- Was the Government, or any agency, consulted or notified before Sharp decided to cancel the November services and any later services? If so, when?
ANSWER:
Building Tasmania and Tourism Tasmania routinely discuss forward flight schedules with Sharp Airlines. Sharp advised Building Tasmania and Tourism Tasmania on 12 October 2026 that it was reviewing some services in November and later months. These were the subject of discussion between Sharp and Tasmanian Government officials, with particular focus on the November services.
Sharp sent an email to staff in Building Tasmania and Tourism Tasmania on 22 October 2026 advising that it had cancelled flights across November and December 2026 and January and April 2027
QUESTION: - How many services across what date range were proposed for cancellation?
ANSWER:
Sharp advised that three services on 12, 19 and 26 November 2026 would be cancelled, together with 11 later services comprising three in December 2026, four in January 2027 and four in April 2027, for a total of 14 services across November 2026 to April 2027.
QUESTION: - What is the “review and consultation process” for poorly loaded flights referred to in discussions with Sharp, who participates in it, and how are island communities consulted?
ANSWER:
The review consists of regular discussions between Sharp and officials from Building Tasmanian and Tourism Tasmania. Discussions focus on passenger demand, forward bookings and efficient use of the capped funding allocation. The objective is to maintain connectivity across the season and provide access for the community and visitors, taking into consideration both Sharp and REX schedules.
Sharp Airlines has been operating services to King Island for over 10 years and understands community needs based on both historical demand and forward bookings.
QUESTION: - On Thursday 22 October 2026, Sharp Airlines notified passengers by SMS, email and in a follow-up phone call, that King Island–Essendon services, including SH927 on 19 November 2026, had been cancelled “at the direction of the Tasmanian Government”. Your Ministerial Office has since advised that this was incorrect, and that the cancellations were an operational decision by Sharp Airlines due to soft loads. Has the Government sought a public correction from Sharp of its statement attributing the cancellations to the Government?
ANSWER:
Tasmanian Government officials contacted Sharp Airlines on the morning of 23 October 2026.
Sharp Airlines has written to me apologising for the communication, acknowledging that its statement that the cancellations occurred ‘at the direction of the Tasmanian Government’ was inappropriate.
Sharp Airlines will continue to engage with its customers directly, as is appropriate for a commercial airline. However, Sharp Airlines recognises the importance of consulting with the Tasmanian Government before significant scheduling changes are communicated to customers.
QUESTION: - Has Sharp given any assurance about management level approval of future customer communications in similar circumstances?
ANSWER:
As the air services between Melbourne and King Island are primarily a commercial operation, this is a matter for Sharp Airlines.
The Tasmanian Government understands that Sharp Airlines has assisted affected passengers with rebooking, or offered refunds where passengers prefer to travel with the alternative provider on this route.
QUESTION: - What requirements, if any, does the agreement place on Sharp to consider passengers travelling for medical treatment, including those supported under the Patient Travel Assistance Scheme, when cancelling or rescheduling services?
ANSWER:
Medical needs of passengers travelling are not specifically addressed in the Grant Deed. In providing funding to support these flights, the Tasmanian Government’s priority is to ensure the greatest overall connectivity and access to meet community needs and visitors, while ensuring efficient use of the capped funding allocation.
QUESTION: - What assistance is available to King Island residents whose medical appointments or treatment are disrupted by cancelled services, including help with rebooking, extra accommodation or travel costs?
Any rebooking of cancelled services including help with rebooking, extra accommodation or travel costs is an operational matter for Sharp Airlines.
QUESTION: - Has the Government assessed the impact of the cancellations and the incorrect messaging on King Island tourism operators, including lost bookings and damage to visitor confidence? What is Tourism Tasmania doing to support affected operators and reassure the market?
ANSWER:
Schedule management is a core commercial activity for airlines. The circumstances in which the proposed cancellations were communicated was regrettable.
The Tasmanian Government has not undertaken an assessment of the impact of the cancellations given the ability of passengers to re-book on alternate services and the small total number of passengers affected.