Wagga Wagga Airport will stay in public hands for the next generation. Photo: Michelle Kroll.
Wagga Wagga City Council will retain control of the city’s airport for the next 50 years, with the Federal Government now formally locking in an arrangement that had been under negotiation since plans to privatise the airport were abandoned.
The Albanese Government confirmed on Thursday (17 September) the council and the Department of Defence had reached agreement on a new 50-year lease for Wagga Wagga Airport.
The agreement ends more than two years of uncertainty over whether the Commonwealth would continue leasing the facility to the council or seek a private operator.
Assistant Minister for Defence Peter Khalil said the agreement “locks in the future” of the airport and gave the council certainty to continue investing in it.
The airport is owned by the Commonwealth and sits alongside RAAF Base Wagga, with the council responsible for operating and maintaining the civilian airport.
Defence will retain access to the airport to support operations at the base.
The dispute began in February 2024 when Defence indicated the airport would be put “to market” when the council’s existing 30-year lease expired, raising concerns that it could be privatised.
Defence officials rejected the description of the proposal as privatisation, arguing a commercial lease was different from selling the airport.
But the prospect of a private operator prompted a strong backlash from the council and some Riverina politicians.
The council argued a private operator could put commercial returns ahead of the needs of regional passengers, airlines and aviation businesses.
Riverina MP Michael McCormack backed the council’s campaign against privatisation.
Former councillor Paul Funnell took the opposite view, arguing the council had poured millions of dollars of ratepayer money into the airport and questioning why it should continue operating a facility he described as a drain on ratepayers.
He also pointed to Canberra Airport as an example of a regional airport that had successfully operated under private ownership.
The debate was complicated by the unusual financial arrangement surrounding Wagga Airport.
Unlike most NSW regional airports, which were transferred to local councils about 30 years ago, Wagga remained Commonwealth-owned because of its connection to the active RAAF base.
The council pays Defence about $200,000 a year to lease the airport while also being responsible for maintaining and upgrading the civilian facilities.
The council has also carried the cost of major infrastructure works, including a $5.3 million taxiway upgrade funded through a council loan.
The airport’s uncertain future raised questions about whether the council should continue committing ratepayer money to an asset it did not own and whether it would be compensated for improvements if the lease was not renewed.
Running a regional airport also comes with significant financial risks for councils.
When Rex Airlines entered voluntary administration in 2024, Wagga Council was owed $205,037.54 in passenger fees and rental invoices.
The council was an unsecured creditor and was not expected to receive a dividend from the airline’s administration.
The Federal Government later allocated the council $187,885 through the Regional and Remote Airport Support Program.
In December last year, the council said it had received a verbal agreement for a proposed 50-year lease with a 49-year option, but the final agreement had not been documented.
The Commonwealth has now confirmed the initial 50-year lease.
The new lease gives the council greater certainty to make long-term investments, but does not transfer ownership of the airport to the city.
