Qantas and Virgin are getting federal government support to operate critical domestic routes as the airlines grapple with the economic fallout of COVID-19.
The commonwealth will underwrite a range of flights, spending an initial $165 million to help sustain the Australian airlines.
The new arrangements will last for eight weeks with a government review set to determine if more support is needed.
Deputy Prime Minister Michael McCormack said the move was about ensuring secure and affordable access for passengers who need to travel - such as essential workers - and supporting the movement of crucial freight.
Deputy Prime Minister Michael McCormack. Source: AAP
"We know that a strong domestic aviation network is critical to Australia's success and today's announcement demonstrates our commitment, yet again, to maintaining connectivity during this pandemic," he said in a statement on Thursday night.
"This investment will also help Australians returning from overseas, who find themselves in a different city after 14 days of mandatory quarantine, complete their journey home safely."
The flights will service all state and territory capitals, along with Albury, Alice Springs, Coffs Harbour, Dubbo, Kalgoorlie, Mildura, Port Lincoln, Rockhampton, Tamworth, Townsville and Wagga Wagga.
The announcement is well short of the $1.4 billion government bailout Virgin is hunting to stay alive.
Treasurer Josh Frydenberg is instead putting pressure on the company's shareholders, saying they have "deep pockets".
"We want to see Virgin continue, we want to see two airlines in the domestic market, but we're not in the business of owning an airline," Mr Frydenberg told ABC radio on Thursday.
Mr Frydenberg said the government was continuing to talk to the company as well as Qantas, having already provided more than $1 billion in relief for the aviation industry.
Virgin on Thursday announced a further seven-day trading halt for its shares to continue talks on financial aid and restructuring alternatives to help it weather the crisis.
The airline didn't identify who the talks are with.
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