Regional councils and airport operators across the region are being urged to apply for federal grants to maintain and upgrade their airports, as a newly released report from Business NSW paints a stark picture of the financial strain facing regional aviation across New South Wales.
Round 5 of the Commonwealth’s Regional Airports Program is now open for applications, offering grants of between $20,000 and $5 million for eligible works at airports and aerodromes in regional areas. Grants cover up to 50 per cent of total project costs and can fund runway resurfacing, fencing, lighting, safety training, airside shelters and upgrades to support the transition to net zero aviation technology. Applications close Tuesday, 28 July.
The funding round comes as Business NSW’s newly released report, Keeping Regional NSW Connected: The Future of Our Airports, warns that more than half of regional airports in NSW are operating at a loss, with a median annual deficit of around $192,000. The report found that more than 20 airports had deferred essential capital works due to funding constraints, with annual investment across the sector representing just 3.3 per cent of replacement asset value.
The report also found that 62 per cent of regional and remote routes in NSW are serviced by only one airline, leaving communities with little protection against fare escalation or sudden service withdrawal. Tamworth and Port Macquarie were among regional NSW towns left without direct interstate connections following the collapse of Bonza in 2024.
Armidale Airport featured in the report as an example of the infrastructure challenge, having closed for the entire month of February 2025 to undergo urgent runway repairs.
Federal Member for Parkes Jamie Chaffey said the funding round was one of the few avenues available to councils struggling to maintain critical infrastructure.
“Airports are critical to keeping our communities connected. They play a huge role in freight, in health transport, in passenger transport and in many other areas of regional life.
“Many airports or aerodromes in regional areas come under the umbrella of regional councils who are already struggling with financial sustainability and can’t meet the costs of maintaining this infrastructure, let alone upgrading it. Cuts to local government funding by the Federal Labor Government have made this situation significantly worse.”
Chaffey said the scope of the program made it particularly valuable for councils with limited options.
“The Regional Airports Program is one of the few remaining ways councils can apply to access funding for works such as runway resurfacing, fencing, lighting installation, and upgrades or works to support air services transition to net zero aviation technology, along with safety training and airside ambulance and passenger shelters to support patient health in transit.
“I encourage organisations whose responsibilities include airports to apply for this funding for their critical projects.”
The Business NSW report called on the NSW and Commonwealth governments to develop a 10-year Regional Aviation Strategy, establish a dedicated Regional Aviation Infrastructure Fund, and guarantee regional access at Western Sydney International Airport from the time it opens for passenger operations in October.
Applications for Round 5 of the Regional Airports Program close 28 July and can be lodged at business.gov.au/grants-and-programs/regional-airports-program-round-5.
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