The operators of iconic trains The Ghan, the Indian Pacific and the Overland will be forced to slash services because of Abbott Government cuts to subsidies for travel by pensioners and war veterans.
Labor understands that Great Southern Rail expects patronage to decline by at least 20 per cent after Mr Abbott’s short-sighted cuts take effect from July, 2016.
The company will be forced to impose steep fare increases and halve the frequency of the Ghan and the Indian Pacific services from twice a week to once a week.
The cuts will seriously damage regional tourism in South Australia, the Northern Territory and Western Australia by reducing the number of tourists visiting regional centres and spending money in local economies.
While Tony Abbott spent part of this week in Adelaide seeking to lift his sagging political stocks, he should have explained why he is undermining regional tourism at the very time we need growth in the sector to help make up for the end of the mining boom.
He should have also told South Australians what he plans to do when his cuts inevitably cause job losses at Great Southern, which employs about 400 people, mainly in Adelaide.
Great Southern was formed in 1997 after a privatisation of the old government-owned Australian National. Pensioner subsidies of up to 55 per cent for pensioners and 88 per cent for war veterans were built into the privatisation arrangement to retain the viability of the services and support regional tourism.
The company operates the Overland, which travels between Adelaide and Melbourne; the Indian Pacific, which travels between Sydney, Adelaide and Perth; and the Ghan, which travels between Adelaide and Darwin.
All of these services make multiple stops in regional centres, pumping $100 million a year into regional Australia, thereby boosting local communities and creating jobs.
Labor understands the company has told some travel agents it proposes steep fare increases to make up for Mr Abbott’s withdrawal of support.
For example, the fare for a sleeper for war veterans on the Indian Pacific between Adelaide and Broken Hill is expected to climb from the current $83 to $969, while the equivalent fare for Adelaide to Kalgoorlie will rise from $243 to $1999.
A standard sit-up pensioner fare between Adelaide and Bordertown will increase from $45 to $87.
Since taking office Mr Abbott has done nothing to promote Australia’s lucrative tourism sector, failing even to have a designated minister for tourism.
In the case of the Ghan, the Indian Pacific and the Overland, he is now actively undermining the sector, risking jobs and denying economic activity to towns and cities that desperately need tourism dollars.
Mr Abbott must immediately restore funding for discounts for pensioners and war veterans on our great inland train routes or watch more people lose jobs, not just in Adelaide, but right across the affected regional economies.