Federal MP prepared to send aviation contract issue to state’s corruption watchdog

Inconsistencies between Far North aviation approvals, and the absence of key information about a Queensland government contract, have generated calls for serious investigations into political conduct.

A Far North MP has called for an independent investigation into possible political corruption in response to new revelations about a Queensland Government aviation contract.

Leichhardt MP Warren Entsch said he was incensed when he learnt the state government had not written an exit clause into an emergency services contract awarded to Hinterland Aviation in June 2023 when the government was aware Hinterland’s competition, Skytrans, would be at a comparative disadvantage when operating the same routes.

On Friday Skytrans’ CEO Alan Milne told News Corp in mid-June 2023 he made the office of the state’s transport minister aware of Skytrans’ renewed compliance with aviation regulations and its impending restart of operations into outer Torres Strait Islands, only to then be told the government had subsidised Skytrans’ competition to operate the same routes.

Leichhardt MP Warren Entsch has called for a corruption probe into the state government’s handling of an emergency services contract awarded to a Far North airline. Picture: NCA NewsWire / Martin Ollman

Mr Entsch said the state government had the opportunity to author an exit clause into Hinterland’s ESC, which he said was standard practice for similar contracts, to ensure taxpayer funds were not being used to unfairly subsidise one airline over the other while both operating the same route with the same planes.

Mr Entsch stressed, however, he did not suspect any foul play from Hinterland Aviation.

News Corp is also not suggesting Hinterland Aviation engaged in wrongdoing.

Skytrans temporarily ceased operations to certain islands in October 2022 due to regulation changes; the Hinterland ESC was awarded eight months later, after the death of Far North speech pathologist Wendy Richardson near Mabuiag Island, who was travelling by boat in the absence of flights.

Skytrans’ services throughout the Torres Strait Islands have been reduced after the ESC was awarded to its competitor Hinterland Aviation, according to Skytrans’ CEO. Picture: Isaac McCarthy

“Why did it take the death of one of our own before the state government activated an ESC? Why did they wait until Skytrans were on the cusp of flying again? If it’s not corruption, there are a lot of questions that need answering,” Mr Entsch said.

“Referral to the CCC would be the next step.

“There was no termination clause in the contract, it wasn’t put out to tender and no-one can find out how much it is worth. It’s been subject to great secrecy.”

Hinterland Aviation’s CEO Andrew Clair said the conduct of his airline had been completely above board in winning the ESC.

Hinterland Aviation’s CEO Andrew Clair said his airline’s conduct had been completely above board. Picture: Stewart McLean

“I think CASA has done everything right. I think the state government has done everything right to fix a failure in the market,” Mr Clair said.

Mr Clair said he could not comment on the ESC’s particulars, including its value and the fact it did not contain an exit clause.

Bart Mellish, Queensland’s transport minister, said the department was best placed to answer questions about the Hinterland ESC.

“The Emergency Services Contract with Hinterland Aviation was signed more than six months prior to the current minister taking on the Transport and Main Roads portfolio,” Mr Mellish said.

A Department of Transport and Main Roads said claims made by Mr Entsch regarding the ESC were “factually incorrect”.

“The ESC was awarded before Skytrans resumed operations to the islands,” the spokesman said.

Skytrans’ CEO Alan Milne reiterated he informed the minister’s office of his airline’s readiness prior to news that Hinterland Aviation was awarded the ESC and said the route no longer needed a subsidy.

“We’re happy to operate the Mabuiag and Erub routes without a subsidy as we have for the past 20 years,” he said.

Originally published as Federal MP prepared to send aviation contract issue to state’s corruption watchdog