Embattled airline Rex has welcomed the federal government’s announcement it will guarantee regional flight bookings while the company is in voluntary administration.

Transport Minister Catherine King made the announcement on Thursday, just over two weeks since Rex went into administration last month with debts of about $500 million.

“Travellers can continue to book regional flights on Rex during this process with certainty that they will either fly or get their money back,” King said.

The guarantee applies to all regional flight bookings made after Rex entered voluntary administration at 9.31pm on July 30.

“Rex’s continuation is in the best interests of Australia – and the government is working closely with the administrators to ensure a strong regional aviation presence now and into the future,” King said.

An announcement about Rex pic.twitter.com/cSZPSwgD8A

— Catherine King MP (@CatherineKingMP) August 15, 2024

In question time later, King said the government guarantee meant travellers could confidently book regional flights with Rex.

“This is not a Commonwealth injection of funds into Rex or the administrators. It is a guarantee for bookings made after the airline entered into voluntary administration,” she said.

“The guarantee will only be triggered if a service is cancelled and where no alternate service has been delivered, and no refund if the guarantee is triggered.

“It’s a message very clearly to regional Australia. We know how important reliable air services are to you. We are not going to allow your communities to be left behind.”

Cash-strapped Rex has launched an asset sale and buyer search since its collapse late last month, in a desperate effort to stay in the air.

Administrators from professional services firm EY Australia have previously urged wary travellers to keep flying with Rex, although the carrier’s long-term future remains unclear.

Voluntary administrator Sam Freeman said the government backing announced on Thursday was a positive step towards securing the future for Rex, its 1200-plus employees and Australians who relied on the airline to service their communities.

“We have experienced first hand the importance of Rex’s regional services to the communities the airline serves and would like to express our gratitude to the federal government for stepping in with this support,” he said.

“The guarantee will help Rex to keep flying while we undertake the recapitalisation of the airline and secure its future. We’re currently undertaking a process to find an investor committed to a sustainable commercial regional network.”

Rex services more than 60 destinations, including 41 routes to regional and remote communities. They include 21 serviced exclusively by the airline.

The airline has already axed nearly 600 jobs while hundreds more remain in limbo amid uncertainty about the future of the carrier.

The Transport Workers’ Union backed the government guarantee, but slammed the administrator for “delays and uncertainty” on the owed entitlements of 343 workers made redundant so far.

“This is a stop-gap measure which must be followed by further well-designed intervention to secure redundant workers’ entitlements as soon as possible, guarantee a long-term future for regional air travel, and provide a seat at the table for the public,” national secretary Michael Kaine said.

“Hundreds of workers who lost their jobs in the blink of an eye have now been waiting two weeks for any information on how or when they’ll be able to access their owed entitlements.”

Meanwhile, Kaine said, Rex chief executive Neville Howell could be in line for golden handshake after securing a 12-month termination period in his contract six days before the airline went into administration.

“Workers deserve answers and those answers need to be in their best interests,” he said.

Rex announced the change to Howell’s termination conditions to the stock exchange on July 25.

-with AAP